Question & Answer

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Friday, January 31, 2003

Medicaid: A foe ‘without feeling’
AMARILLO, Texas - When defending your company against a Medicaid audit, facts are facts. The bottomline: If a provider can show delivery, Medicaid will listen. But if the facts are not there, it doesn’t matter how honest a provider paints himself, if he can’t document that he made the deliveries in question, he’s got problems, said Jeff Baird, a healthcare attorney with Brown & Fortunato in Amarillo, Texas. In light of the problems Bob Nutting’s having with Maine Medicaid, HME News queried Baird on what to expect when undergoing such an audit.

HME News: Sounds like a Medicaid audit is fairly black and white. You either have the evidence to refute the charges or you don’t.

Jeff Baird: If we have good information to refute the findings that is great, and hopefully we can reduce the number of claims that are questioned. If we don’t have good evidence, than we have a problem. We’re pretty much stuck with what the state has come up with.

HME: How willing is Medicaid to negotiate down the amount they want recouped?

Baird: It depends on the financial wherewithal of the company. If the company is stout, Medicaid will look at between actual charges and double that amount. If the company is moderately solid and without a lot of cash, you are looking at actuals. If the company is really teetering, than you are looking at less than actuals, and that has to be supported by financial statements. The government is without feeling or passion. Often from Medicaid’s standpoint, what is negotiable is double and triple (charges). If you get less than actuals, you are securing a victory.

HME: How do you typically defend a Medicaid audit?

Baird: If we can convince (Medicaid) that we are not a risk going forward, we can often engage them in an “ability to pay” reduction. You say, “I’ll pay everything I can possibly pay. We’ll sell the Lexus and buy a Cavalier. Here are the supporting financials.” The Medicaid program will often be interested in entering into this type of settlement.

HME: What are the chances that a company can fight Medicaid and not have to pay anything?

Baird: With very few exceptions, the Medicaid program is going to win, just like the DMERC is going to win, just like the Department of Justice is going to win. You can probably count on one hand the number of companies that are going to litigate, whether it’s on the federal or state side, and win. There have been a number of issues over the years I would have loved to have taken to the court system, but no one has the money to win that fight. And if you lose, you go down in flames.

HME: When it comes to negotiating a settlement, how does Medicaid get providers to play ball?

Baird: Medicaid has three bricks it can hold over a company’s head. One, they can shut off your provider number and offset your receivables. Two, they can sue you for the money they think you owe. Three, they can say, “We think this might be intentional or criminal in nature and are contemplating turning this over to the Department of Justice.” Those are three huge bricks. HME
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