ST. PAUL, Minn. (AP/WCCO) — A federal audit estimates that Minnesota made $3.7 million in unallowed payments to managed care organizations from 2014 to 2016 for dead people who had been enrolled in Medicaid.

The inspector general at the U.S. Department of Health and Human Services said in a report Wednesday that the unallowed payments happened because the state didn’t always properly update its records to show that beneficiaries had died. The report recommended that the state refund the $3.2 million to the federal government and work recover improper payments.

The Minnesota Department of Human Services blamed the switchover to a new computer system. Commissioner Jodi Harpstead says her department began fixing the problems and recovering the overpayments long before the audit. She says her department will refund any additional overpayments that can be verified.

“Ensuring our records are up-to-date so we do not pay for individuals who are no longer receiving care is a continual challenge. We gather death information from many different sources, which do not always report in a timely manner. Because these payments are made to health plans in advance we will always have to reconcile accounts. We are using continuous process improvement, including periodic data match, to get payment accuracy rates as close to 100 percent as possible to be trustworthy to taxpayers,” Harpstead said.

State Representative Joe Schomacker, R-Luverne, Republican Lead of the Minnesota House Health and Human Services Finance Division, issued a statement.

“This is just another example of the problems that have taken place within the Department of Human Services. While this issue is now behind us, it highlights the need for us to continue to investigate what is happening within the agency. That’s why House Republicans have been pushing Democrats to address the failures of DHS during this week’s mini session,” Schomacker said.

(© Copyright 2019 CBS Broadcasting Inc. All Rights Reserved. The Associated Press contributed to this report.)

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