30 Jun MEDICAID’S IMPROPER PAYMENTS AND INCREASED SPENDING
According to federal agency data from PaymentAccuracy.gov and the Office of Management and Budget, the federal government spent an estimated $247 billion in improper payments in 2022. The data also uncovered that the Department of Health and Human Services’ Medicaid program represented the majority of these payments at $80.6 billion. Medicaid has become the largest single budget item on states’ budgets, and in order for the program to continue being solvent, states must resolve Medicaid’s improper payment problem.
Recently, states have started Medicaid eligibility redeterminations because of the end of the Coronavirus Public Health Emergency continuous enrollment provision. Since June 29th, at least 1,536,000 enrollees have been disenrolled. Some states are expecting the eligibility redeterminations to lower program costs; however, KFF is predicting that it’s possible that state Medicaid spending will increase as the enhanced FMAP expires. Medicaid can not afford increased program spending while losing billions in improper payments.
A frequent misunderstanding is that improper payments stem from fraud and abuse when in reality, the vast majority stem from prosaic, mundane issues such as eligibility errors and antiquated data systems. One way plan administrators could reduce improper payments and improve program efficiency immediately is to adopt technology solutions that help identify primary commercial payers in order to avoid making claims payments in error.
Quality Data Reduces Improper Payments
Health plans have trouble identifying primary coverage on pharmacy and medical claims because the data they access is not current, available, complete, or accurate. For this reason, plans have no choice but to pay claims in error and chase reimbursement once other health insurance (OHI) is found. Regrettably, for Medicaid plans, the actual monies recovered remain around twenty cents on the dollar.
Syrtis Solutions understood that Medicaid plans needed a means to identify active OHI coverage to adjudicate claims properly. ProTPL, introduced in 2010, is a real-time point-of-sale cost avoidance service for government-funded healthcare programs that delivers powerful, accurate, and actionable eligibility data. The solution gives health plans the ability to cost avoid Rx and medical claims and the associated costs of recovery.
Medicaid’s improper payments are costing billions of dollars every year, and program expenditures are rising. Consequently, states are likely to begin considering trimming benefits. To stay solvent and continue delivering care to the most vulnerable populations, Medicaid must strengthen its fiscal oversight of program expenditures and ensure that program resources are spent correctly. At the moment, the best place to start saving resources and reducing improper payments is to provide Medicaid payers access to clean and actionable eligibility data that they can rely on.