House panel hears testimony on site-neutral payments, potential for Medicaid cuts to providers

Two Congressional subcommittees focused on oversight are banding together to look at reducing fraud and waste in the Medicaid system.

The Centers for Medicare & Medicaid reports 10% of all 2017 payments were improper because of incorrect reimbursement rates or unneeded or non-covered care. The Government Accountability Office has also called Medicaid a “high-risk” program since 2003, noting its susceptibility to fraud, abuse and mismanagement.

Medicaid is far and away the No. 1 payer of skilled nursing care in the United States.

Lawmakers have traditionally seen cutting improper payments as a way to offset rising costs. Earlier this month, the Council for Medicare Integrity asked Health and Human Services Secretary Alex Azar to expand audit capabilities.

The Trump administration has broadly backed Medicaid reform ranging from instituting block grants to states to beneficiary work requirements, cutting funding and considering lifetime limits.

But San Francisco healthcare attorney Judith Waltz told Bloomberg Law that it’s become harder to  target waste such as improper payments in the age of Medicaid managed care.

“You now not only have the 51 state systems (including Washington, D.C.) processing claims but you have multiple Medicaid managed care plans and their subcontractors processing Medicaid claims,” agreed attorney Ellyn Sternfield. “What’s considered an improper claim in Kentucky may not be considered an improper claim in Washington.”

Waltz said that in response, the federal government has increased its Medicaid anti-fraud enforcement much more than in the past, when enforcement was largely left to the states.

A joint meeting of the House Oversight Committee’s Subcommittee on Government Operations & the Subcommittee on Intergovernmental Affairs was scheduled to examine such issues Wednesday morning, but the meeting was postponed. No new date was immediately announced.

Among those scheduled to testify was Louisiana’s Legislative Auditor Daryl Purpera, who was expected to highlight deficiencies in audit requirements and a lack of access to federal data for state auditors. Purpera is an outspoken advocate of increased Medicaid auditing.