An Extreme Uptick in NC Medicaid Overpayments for June 2013, But Not in Collections! Something Faulty With the System???

Have you ever heard the phrase:

“If it looks like a duck, swims like a duck, and quacks like a duck, then it probably is a duck?”

Similarly, if something looks odd, it generally is.  So when North Carolina overpayments go from $10 million to $80 million from one month to another, I think, “Something is fishy.”  Especially when the A/R, or accounts receivable does not increase.

Now digressing….Humans are, generally, creatures of habit.

In my life, during my week days, I wake up early in the morning, go for a run with my dog, take a shower, go to work, at some point in the day, blog, go home and eat a family dinner, wind-down in front of the TV with my husband, and then go to bed. Repeat…Monday, Tuesday, Wednesday, Thursday, and Friday.

In order for me to change my routine (during the week days), it would take a substantial catalyst.  For example, if, tomorrow, I won $1 million from a lottery, I would guess that my work day would differ, in that I would, most likely, work less. (Although, in my case, that may not be true, since I enjoy my work so much…but you get the point).  Or if my husband were injured or to become sick…my work day would change because I would need to be by his side.

But, generally, my work day schedules are habitually identical.

Generally speaking, the same is for a corporation or a “corporate life.”  As in, corporations are run by management (people, who are creatures of habit) so a corporate entity, generally, conducts its business daily in a like-manner…until some substantial catalyst occurs.

For example, a pharmaceutical company would run normally day-to-day, but when a new drug is approved by the FDA and inserted in the market, the company business may change to adapt to the new product.

Recently, I found a graph of activity with overpayments in Medicaid in North Carolina. The graph was created by Program Integrity (PI), part of the Division of Medical Assistance (DMA).

Apparently, in June 2013, the amount of overpayments identified by the State or third-party contractors significantly rose from the months prior.   See the below graph:

Uptick photo

I understand that the picture quality may not be great.  But the title of this graph is, “Original notice of overpayment versus account receivable setup amount for same case.”

This is a graph taken off the Division of Medical Assistance (DMA), Program Integrity (PI) website.  The whole report can be found here.

The blue-ish-purple line denotes the original amount of overpayment that was sent to the provider by the auditing entity (whether the audit is conducted by Public Consulting Group (PCG), HMS, DMA or another entity)…or the original amount the provider is told they are expected to pay to the State for Medicaid document noncompliance.

Notice that from July 2012 through May 2013, generally, the blue-ish-purple line is consistent. There is a small spike in January 2013, but for the most part, the blue-ish-purple lines are under $20 million in overpayments identified.

Then we get to June 2013. Holy crap, right??? The blue-ish-purple line went from under $10 million in overpayments found in May 2013 to almost $80 million.

A jump of over $70 million!!! (What kind of catalyst caused that activity?)

A jump of more than the 5 preceding months added together!

What I also find very interesting in this graph is the green line.

The green line demonstrates the amount of money actually owed to the State once the appeals are exhausted and someone, whether it be a judge or a DHHS hearing officer, decides is ACTUALLY owed…or ACTUALLY received.

In June 2013, while $80 million in overpayments were found, less than $5 million was actually recouped by the state.  In other words, for whatever reason, over $75 million  in overpayments was found to NOT be owed to the State, despite the original contention that the money was owed to the State.

Is the method used by the State (or whatever 3rd-party contractor) to determine the Medicaid overpayments SO FLAWED and SO INACCURATE that almost all the recoupments are wrong?

I get it. No method is perfect. But I would expect to see a method of recoupment that 10-15% of the overpayments were overturned. BUT ALMOST ALL RECOUPMENTS ARE OVERTURNED? (Or found to not be owed to the State).

I would seriously begin to question the method used to determine these faulty overpayments. Or, if not the method, the implementation.

But, be it the method or the implementation…something is seriously wrong here!!!

It may look like a duck, swim like a duck, and quack like a duck…but it, most definitely, is NOT a duck!

About kemanuel

Medicare and Medicaid Regulatory Compliance Litigator

Posted on August 1, 2013, in DHHS, Extrapolations, Health Care Providers and Services, HMS, Medicaid, Medicaid Audits, Medicaid Recoupment, North Carolina, PCG, Post-Payment Reviews, Public Consulting Group, RAC, RAC Audits, Regulatory Audits, Tentative Notices of Overpayment and tagged , , , , , , , , , , . Bookmark the permalink. 2 Comments.

  1. appears to have been a typo. Check the graph again on the DHHS site. Looks like they changed it.

  2. I would like what type of overpayment was founded.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: