NCPA - National Center for Policy Analysis

Mismatched Data Hamper U.S. Accounting of Medicaid Costs

December 4, 2012

Auditors report that the full extent of U.S. spending on Medicaid is unclear because there are mismatches between government databases, says BusinessWeek.

  • Medicaid is a $459 billion state-federal health insurance program.
  • The Obama administration's new health care law expands Medicaid in 2014 to cover all Americans earning wages near the poverty line.
  • However, there was a $43 billion gap in 2009 when data was compared from the states, which run Medicaid, and the U.S. Centers for Medicare and Medicaid Services, which pays for more than half the program.

A part of this is because the U.S. Department of Health and Human Services had not audited about $4 billion in payments to doctors and hospitals for the purpose of installing electronic record systems. Creating electronic health records was a priority of the Obama administration -- $27 billion was allocated in the 2009 economic stimulus for medical providers who install them.

The delay in reporting the data can be an impediment to creating consistency between the two databases. States are supposed to report one set of Medicaid spending to the federal government within 45 days, however it can be as many as three years late. Hospitals are also under scrutiny for using the computer systems to increase the amount of their billings to Medicare.

Because there are obstacles to overseeing the electronic health records incentive program, there is a risk that professionals and hospitals that do not meet the meaningful use requirement end up getting paid.

The acting administrator of the Medicare agency says that a prepayment audit should not be necessary for the medical records initiatives because it could significantly delay reimbursement to hospitals and doctors.

Source: "Mismatched Data Hamper U.S. Accounting of Medicaid Costs," BusinessWeek, November 29, 2012.


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