Maine Ping
Posted on 05/05/2005 10:11:19 AM PDT by Fido969
State: 'No providers will get paid'
By Victoria Wallack Statehouse Reporter
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AUGUSTA (May 4): The Department of Health and Human Services may have overpaid some Medicaid providers by as much as $51 million because its new computerized billing system still isn’t working –- an error that could mean the state will run out of money before the start of the new fiscal year.
The overpayment, which is just an estimate, is more bad news for the department already being criticized for not paying providers enough because of its computer meltdown.
“No providers will get paid by the end of the fiscal year unless recovery is done,” said Rebecca Wyke, the governor’s commissioner of financial services, about the need to get some of the money back in order to pay those still owed.
Wyke and a team of officials from the DHHS and the governor’s office of Administrative and Financial Services told the Appropriations Committee about the overpayment problem last week.
“We are budgeting extremely tight,” she said, meaning every dollar needs to go to the right place. Unless the money that has been overpaid is recovered, Wyke said, “we definitely will miss the last few [billing] cycles and no one will get paid.” The new fiscal year starts July 1.
The problem started in January when the DHHS threw the switch on a new billing system designed to help the state comply with federal privacy rules and changes in eligible expenses under Medicaid. The system –- paid for with 90 percent federal funds –- started rejecting vendor bills from the 7,000 providers that treat Medicaid patients in the state.
Because virtually no vendors were getting paid, the state started sending out interim payments based on what was paid in November and December of last year. In some cases, however, those payments have turned out to be too high –- with as much as $51 million in potential overpayments out there, according to State Controller Ed Karass.
The problem was compounded because interim payments have continued for so long as the DHHS tries to get its billing system to work properly. The interim payments were intended to be a short-term fix, but have been being sent out since January.
Karass came up with the estimate by looking at what vendors in the state’s Medicaid program –- known as MaineCare –- were paid this fiscal year, through the end of March, as compared to the same time frame in the last fiscal year. If they’ve been paid a lot more this year than last, they could be getting excessive interim payments, Karass said.
To complicate matters, some vendors have said they still aren’t getting paid enough to cover the bills they’ve submitted; a doctor from Belfast estimates he is owed $100,000.
Chris Gianopoulos, acting director of the MaineCare program, said that doctor is “an example of the reverse problem.” The state based his interim payments on the sample billing period from last year, and he told Gianopoulos Monday, “my practice has exploded since the beginning of the year,” meaning the interim payments were far too low.
Gianopoulos said she doesn’t believe the overpayment problem is as bad as $51 million.
“There are not a lot of providers getting paid a lot more than they need,” she said. “I do not think there’s a big problem with thousands of providers getting overpaid.”
But being off just a little could make a huge difference in a system that pays out, on average, $30 million a week to providers. Karass said the only way the department knows what is still owed is “basically through anecdotal questions raised from providers. The department does not have a quantifiable document that reflects what is underpayment.”
He admitted that calculating overpayments is an imperfect science, but it’s all the state can do until it sits down with each of its vendors and figures out the books. That’s no easy task given there are currently 311,000 “suspended” bills that were rejected by the computer system.
The plan is to contact those vendors who appeared to be overpaid, come to some agreement and then stop paying them, with the goal of making up the deficit before July 1.
“We need to have a better understanding of what the overpayments are, make recoveries and recycle that money back out the door to providers that may have been underpaid or are just owed money,” Karass said.
The state will also start meeting with each of its vendors, using the accounting firm of Deloitte and Touche as third-party arbiters, to clean up its ledger and get the system back on track.
The auditing process has to be finished by the end of September because that’s the end of the federal fiscal year. The federal government requires a reconciliation of the books as a condition of providing Medicaid matching funds.
Committee reacts Rep. Darlene Curley (R, Scarborough), a member of the Appropriations Committee, said the overpayment problem is “one more indication of the continual incompetence” in the department –- a problem she said ultimately is the governor’s responsibility.
The DHHS has been beset with accounting problems, many that date back to the previous administration, including more than $50 million in “accounting errors” and a bogus rate increase used to trigger more federal matching funds –- a scheme that led to an investigation by the federal Office of the Inspector General.
Curley said DHHS Commissioner Jack Nicholas was hired to fix the problems with the system, but they apparently continue. “My main concern is with the families that might not be receiving all the services they need because the state isn’t paying the bills,” she said.
Committee member Rep. Arthur Lerman (D, Augusta), who operates an agency that serves Medicaid clients, said he was concerned about the state’s latest plan to recover money. Lerman blew the whistle on the department’s billing problems in January when it came to light vendors weren’t being paid.
“You’re going to be comparing numbers that are not accurate,” Lerman said of Karass’ plan to use last year’s billing records to determine this year’s payments. “There may have been significant changes in terms of the volume of service they provide.”
Karass didn’t disagree but said “there’s only so much date available” to his office. “All we can see right now are the dollars flowing out the door.”
Based in Augusta, Victoria Wallack can be reached by e-mail at news@villagesoup.com.
Get government out of healthcare
Get government out of nearly everything...as Charley Reese writes today...one basic rule on which to base your thinking is government is inherently incompetent, and no matter what task it is assigned, it will do it in the most expensive and inefficient way possible...even a benign one is like a clumsy, retarded giant and therefore you have to be careful to limit what tasks you assign it
Strange that a story of the bankrupt health services in Maine doesn't mention the Ethiopians who have "adopted" the state and its generous welfare payments.
Yup, and I predict we'll see more and more of these stories.
I responded,
"What kind of people would abandon the health care of their elderly to the government?"
He fumed away silently.
I wondered why no mention of the new immigrants from Somalia.
No, they can fix this. They just need more money and more government I'm sure.
WHo wants to guess there IT contractor doesn't have any penalty clauses in the contract? This is worse than Christie Todd Whitman's Dept. of Motor Vehicles contract scam in NJ.
On the upside, the medical professionals in the state will probably take a nice hard look at Republican candidates next election.
I think you might be on to something.
This is just a minor oversight that a $10/pack cigarette tax increase will cure.
/N.E. liberal
In the private sector this incompetence would be gone in a heartbeat......
Strange that a story of the bankrupt health services in Maine doesn't mention the Ethiopians who have "adopted" the state and its generous welfare payments.
Probably because they are Somolians.
ping
D - Another item for the meltdown list.... B
5-14-05 - "As two legislative committees heard testimony Thursday on the potential effects of a cigarette tax increase, Baldacci health policy chief Trish Riley told The Associated Press that "the administration is not ready to embrace a cigarette tax.""
It's a good thing! Maine smoker's are already paying billions into the state. Maybe "they" are beginning to realize that Mainers are finding this out. One can only hope.
Maine Ping
That's the same process used in Communist Soviet Union.
1. They don't pay their bills (as well as some Americans).
2. Health care providers have to charge legitimate patients more to absorb the costs.
3. So, insurance companies raise their premiums.
4. Government subsidizes public hospitals with increasingly higher taxes, yet they are still insolvent.
Also there are other factors... The insurance agents (as well as medical malpractice lawyers, pharmaceutical reps, and doctors) need a new Mercedes every year, so they don't cover dental either (which is essential to good health, not to mention part of the human anatomy).
So? They'll run a supplementary budget item through the Legislature. Spending more is never a problem in Maine.
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