Money problems at the Oregon agency that oversees Medicaid could be more than twice as large as already disclosed, a new report reveals.
Due to errors involving abortion, prison, undocumented immigrants and other factors, the state might have overpaid its contractors or owe other entities as much as $78 million, Oregon Health Authority director Patrick Allen disclosed in a letter to Gov. Kate Brown this month. That’s on top of $74 million in overpayments The Oregonian/OregonLive reported last month.
The agency may have problems taking in money as well as doling it out. Allen listed $34 million that he said is owed to the agency or went untapped, due to budget and accounting problems. The report was Allen’s first biweekly update to Gov. Kate Brown, who directed Allen to submit them in a Nov. 7 letter. Allen’s letter was first reported by the East Oregonian earlier this month.
The disclosures hint at the red meat the reports could serve up to the campaign to overturn $340 million in health taxes enacted to fund the state’s Medicaid program. State auditors are also expected to release their report on the state’s Medicaid system in the upcoming weeks. Voters will decide in a Jan. 23 special election whether to keep those taxes, which lawmakers narrowly approved earlier this year.
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In his letter to the governor, Allen laid out problems that ranged from the state paying Medicaid benefits for unauthorized immigrants to incorrectly using federal funds for abortions.
Allen was careful to say that in most cases staffers are still investigating the problems and the figures and other details will likely change as they learn more. He cited the following problems:
• Medicaid for unauthorized immigrants: Oregon incorrectly paid health-care organizations it contracted with to care for an undisclosed number of unauthorized immigrants, who were mistakenly listed in the state’s computer system as being eligible for more than emergency-room care. Allen did not identify the time frame in which the problem occurred, but it caused $25.7 million in “payment errors and over-claimed federal funds” which the health authority already repaid with state general fund in June.
• Health officials are still investigating another potential problem related to immigrants in the country illegally. Medicaid covers some emergency care for unauthorized immigrants plus prenatal and delivery care for pregnant women. As health staffers were preparing to implement a new abortion law earlier this year, they discovered the state might have been keeping these mothers on Medicaid after their babies were born, a time when the women were no longer eligible, Allen wrote. Benefits might have continued if the mother’s “provider does not notify us of the delivery date,” but the state is still investigating the issue, according to Allen.
• Paying for patients no longer eligible: Allen said that as of July, health-agency staffers estimated Oregon might have to repay $17.3 million in federal funds because the state continued paying health organizations to care for people the state had retroactively deemed ineligible for Medicaid. The problem dates back to January 2014. But new leaders at the agency have cast doubt on whether the $17 million is in the ballpark, saying they are still working to identify the scope of the problem.
• Residential mental-health facilities: States cannot claim federal Medicaid funds to care for patients at large residential mental-health treatment facilities, such as the state hospital. Oregon “overclaimed” $9.7 million in federal money for people in these facilities, which the state already repaid with general fund money this year, according to Allen’s letter.
• Bariatric surgery payments: Oregon paid more than it should have for these weight-loss surgeries from 2009 through 2015, and started trying to recoup the $1.5 million in overpayments a year ago. “As of October 2017, most of the overpayments have still not been repaid by providers, resulting in an accounts receivable balance of $1.1 million,” Allen wrote.
• Medicaid for dead and incarcerated people: “If a client is incarcerated or dies, (per-person) payments should be retroactively adjusted to recoup any payments made after the date of incarceration or death,” Allen wrote. “This is not occurring correctly in the system and … payments have not been fully recouped from the CCOs.” The agency currently seeks repayment only for the last year.
• Abortion coverage: The state estimates it used $1.8 million or so in federal funds for abortions, which it will have to repay. Federal law generally bans using federal funds to pay for abortions, although there are exceptions for cases of rape, incest and when the pregnant woman’s life is in danger, according to the American Civil Liberties Union.
• Money due to drug labelers: Oregon owes an estimated $22.3 million to drug labelers because the state has not passed along some of the money it was supposed to as part of the Medicaid drug rebate program.
Allen also cited problems at his agency and elsewhere with getting money to the right places. They included:
• State accounting problem: The health authority has received an estimated $20 million from the Division of Child Support to pay for children’s health care but has not properly accounted for that money. So state and federal programs were billed for the children’s health care.
• State budget problem: The health agency could gain $14.1 million for nursing facility and post-acute care that was incorrectly sent to the Department of Human Services over the past year.
The health authority might also be able to get federal money for services it has not sought reimbursement for in the past, or for which it claimed less federal funding than it could have, Allen wrote. Examples include services provided to tribal members at nontribal facilities, and certain preventive services.