Objective

To assess the extent of implementation of the nine recommendations included in our initial audit report, Improper Medicaid Payments for Individuals Receiving Hospice Services Covered by Medicare (Report 2018-S-71).

About the Program

Hospice is a coordinated program of home and/or inpatient care that treats terminally ill individuals and their families. Hospice programs provide palliative care, including nursing, physician, and counseling services; home health aides; physical and occupational therapy; medical appliances and supplies; and drugs. When individuals are enrolled in both Medicaid and Medicare (referred to as dual-eligibles), Medicare is the primary payer for Medicare-covered hospice services, while Medicaid is the payer of last resort. In addition to delivering services, hospice providers are responsible for developing a comprehensive plan of care and coordinating care and services needed by patients. Many dual-eligibles in hospice are enrolled in Medicaid Managed Long-Term Care (MLTC) plans, which serve people who require nursing home or long-term home health care. When a Medicaid recipient is enrolled in a MLTC plan, the plan is required to coordinate care with other providers, including hospice providers, to avoid duplicative or excessive services and payments.

We issued our initial audit report on December 28, 2020. The audit objective was to determine whether Medicaid made improper payments to providers on behalf of dual-eligible individuals receiving hospice care covered by Medicare. The audit covered the period January 1, 2015 through July 31, 2019. We determined the Department of Health (Department) had not established sufficient controls to ensure Medicaid payments were appropriate for dual-eligibles receiving care under the Medicare-funded hospice benefit. As a result, the initial audit identified about $50 million in actual and potential Medicaid overpayments, cost-savings opportunities, and questionable payments for services provided to dual-eligibles enrolled in Medicare-covered hospice.

Key Findings

Department officials had made some progress in addressing the problems we identified in the initial audit report; however, additional actions are needed. In particular, the Office of the Medicaid Inspector General had yet to materially recover the overpayments identified in the initial audit. The Department should also complete its assessment of the appropriateness of requiring Medicaid managed care organizations to pay 95% (as opposed to the current 100%) of the nursing home room and board rate for dual-eligibles enrolled in hospice. Of the initial report’s nine audit recommendations, three were implemented, five were partially implemented, and one had not yet been implemented.

Key Recommendation

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