Sneak Preview: Wash. Agency To Improve Managed Care Monitoring

June 18, 2014 | By Jerry Ashworth | Post a Comment

xsass_bookshot(The following was excerpted from an article in the Single Audit Information Service.) The Washington State Health Care Authority plans to take steps to improve its ability to monitor the Medicaid managed care program and to help managed care organizations (MCOs) better determine allowable costs, in response to concerns raised in a recent Washington State Auditor’s Office audit.

In the state’s Medicaid managed care program, MCOs receive from the state monthly per-person payments to pay doctors and other providers. The per-person rate the state pays is based on how much the MCO’s reported in provider payments. Without adequate oversight and controls, MCOs may overpay providers, putting the state at risk of paying unnecessarily high premium rates in following years, SAO said.

After reviewing calendar year 2010 managed care program information, SAO found inadequate oversight and limited controls over expenditures. For example, although HCA requires MCOs to perform data checks to prevent improper payments, MCOs only had checks to analyze hospital claims and did not perform similar checks on professional claims by doctors and other specialists. “Performing additional checks and data analysis, particularly for high risk claims, could help the state and its MCOs identify and reduce overpayments,” SAO added. “Failure to resolve these issues will lead to higher Medicaid costs, especially as growth and enrollment in Medicaid managed care increase with federal health care reform.”

SAO found that two of the state’s largest MCOs had overpaid their providers $17.5 million in 2010, which may have resulted in additional costs to the state because those expenditures were used to calculate the premium rates paid by the state to MCOs in 2013.


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