Medicaid

The results of an audit conducted by the state of Michigan were released on Tuesday, June 17, 2014. The audit found that the state Medicaid program improperly spent $160 million over a three-year period – from October 2010 through August 2013 – on home care services under the Medicaid Home Help Program.

Home care services provide assistance to those residents with disabilities or cognitive impairments who wish to remain in their own homes instead of a care facility. Some services provided include assistance with eating, bathing, and dressing. The overpayments were the result of state administrators of the Medicaid Home Help program failing to obtain invoices and other required documents from service providers. Home care services differ from home health services in that home health services provide continuous medical treatment that a beneficiary would normally receive in an outpatient or inpatient setting, in the home, over extended periods of time. In order to be reimbursed for home health services, home health providers must also meet numerous requirements that home care providers are not subject to (e.g., the face-to-face requirements under the Affordable Care Act).

The Medicaid Home Help Program serves about 67,000 people per year and expenditures from the program account for about 18 percent of all joint federal-state Medicare spending in the state of Michigan. What is particularly important that providers should take note of – and keep a watchful eye out for – is that the state of Michigan may be required to pay back nearly $100 million to the Federal government under regulations governing the matching of state Medicaid expenditures with Federal dollars. If such a repayment is required, the state will likely seek to recoup part, if not all, of the funds from providers who were improperly paid. In fact, the director of the Department of Human Services (DHS) – one of the state agencies responsible for administering the program – says it has already begun the process of recouping payments from some providers. However, DHS notes that it does question the estimated amount of improper payments, challenging it on the basis that it was extrapolated from a small sample size.

In the past year, thousands of health care providers across the country have been excluded without cause from their insurance plan’s provider networks. The proliferation of narrow networks – defined as health insurance plans that limit the doctors and hospitals available to their subscribers – has caused a backlash amongst providers, who claim the insurers’ terminations will squeeze beneficiaries on access to care, and disrupt longstanding patient-physician relationship, emergency department care, and referral networks.

Although the Affordable Care Act did not create narrow networks, the reform law accelerated the trend by limiting insurer’s ability to continually lower benefits and exclude unhealthy individuals. Without other ways to compete, controlling providers and limiting choice is the insurers’ best way to lower premiums and thus compete on the exchanges. Insurers claim that narrow networks control costs and allow for higher quality, better coordinated care.

In most cases, however, patients choose insurance plans based on the plan’s access to a specific provider network. Patients subscribe and re-subscribe to one-year commitments with the primary intent to access their long-term primary care physicians or other regularly seen providers. Patients often build relationships with these providers over several years, even decades. Now, without notice or the ability to switch their plan, the patients’ physician is suddenly out-of-network and cost-prohibitive.

Articles Posted in Medicaid

Michigan Medicaid Audit Reveals $160 Million in Overpayments for Home Care Services – Should Providers be Worried?

Physicians Nationwide Face Terminations as Insurance Plans Move to Narrow Networks