Objective

To assess the extent of implementation of the six recommendations included in our initial audit report, Payments by CVS Health for Pharmacy Services for Ineligible Members (Report 2020-S-17).

About the Program

The New York State Health Insurance Program (NYSHIP), administered by the Department of Civil Service (Civil Service), covers over 1.2 million active and retired State, local government, and school district employees, and their dependents. Civil Service contracts with CVS Health (CVS) to administer the Empire Plan’s pharmacy benefits.

Civil Service maintains the New York Benefits Eligibility and Accounting System (NYBEAS), the system of record for member enrollment and eligibility information. Civil Service provides CVS with a daily update file of NYBEAS changes, and CVS has access to NYBEAS to confirm eligibility information. Timely and accurate member eligibility information is crucial to ensure members are disenrolled promptly and to prevent payment of ineligible claims on their behalf.

Our initial audit report, issued on September 29, 2021, determined if CVS paid pharmacy claims for Empire Plan members who were not eligible. Our audit covered the period from January 1, 2014 through December 31, 2019. We determined overpayments of $30,695,221 were paid for ineligible members due to data transfer issues and retroactive disenrollments of members.

Key Finding

Civil Service and CVS have made progress addressing the issues identified in the initial audit. While none of the $30,695,221 in improper payments has been recovered, Civil Service and CVS are working to develop a procedure for the recovery of these and future improper payments. In addition, continued reconciliation of eligibility data files between the Civil Service and CVS eligibility systems helps to ensure claims are paid only for eligible members. Civil Service continues to provide training programs to remind health benefits administrators (HBAs) of their responsibilities. Of the report’s six recommendations, two were implemented, three were partially implemented, and one was no longer applicable.

Key Recommendation

Officials are given 30 days after the issuance of the follow-up report to provide information on any actions that are planned to address the unresolved issues discussed in the follow-up report.