Federal pressure on Medicaid trickles down

Friday, March 22, 2013

WASHINGTON – With state Medicaid programs collectively owing more than $225.6 million in overpayments to CMS, HME providers can expect to see those programs look their way.

In a February report, the Office of Inspector General (OIG) recommended that CMS increase efforts to collect Medicaid overpayments and educate states about their responsibility to report overpayments.

“We have seen some serious effort on behalf of Medicaid to get involved with benefit program integrity and targeting funds for recoupment,” said Andrea Stark, a reimbursement consultant with MiraVista. “(Medicaid programs) are recognizing that their systems, policies and procedures aren’t as sophisticated as Medicare’s, and they are funding (efforts to improve their systems).”

There’s a reason Medicaid is ramping up overpayment recoupments. With state budgets shrinking—and federal matching funds right along with them—states are motivated to collect every last dollar that they are owed, say stakeholders.

“States are not just going to hand over that money without fully recouping it from providers,” said Ryan Ball, director of state policy for VGM & Associates. “With states across the country looking for ways to make up revenue and costs associated with their Medicaid programs, this is likely to significantly increase in the months ahead.” 

Some states are already seeing upticks in Medicaid recoupment activity. In Florida, for example, providers in December received letters seeking five years of overpayments that resulted from a systems glitch.

“In this industry right now, this is the final nail in the coffin—they are just hit from every angle,” said Kelly Wolfe, CEO of Regency Billing and Consulting. “It’s scary if it starts happening in a lot of different areas.”