Oregon overpaid nearly $75 million for Medicaid

(Update: Adding secretary of state’s statement)

PORTLAND, Ore. (AP) – The Oregon Health Authority says the state wrongly paid Oregon health care organizations nearly $75 million in federal Medicaid money from 2014 to 2016.
 
Officials tell The Oregonian/OregonLive the state might have to repay all of it. New chief financial officer Laura Robison says the overpayments occurred because the health agency paid health care organizations it contracted with to serve certain senior Medicaid patients inaccurate, excessively high rates.
 
The revelation comes about three months after Gov. Kate Brown fired Lynne Saxton as director of the agency.
 
The newspaper reports Saxton and other top officials knew about the overpayments, but withheld the information.
 
Brown spokesman Chris Pair says the governor wasn’t told of the problem until Oct. 17, and she finds that unacceptable.

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Gov. Kate Brown news release issued Tuesday:

New OHA Leadership Takes Action to Resolve Overpayments Made in Wake of Cover Oregon Failure

(Salem, OR) — Governor Kate Brown today recognized the work of Patrick Allen, the newly appointed director of Oregon Health Authority (OHA), and his team for acting quickly to bring stability and transparency to OHA’s work on behalf of Oregonians. After just two months leading OHA, Allen has directed staff to resolve yet another consequence of the Cover Oregon technology failure. Governor Brown appreciates that Allen is making the resolution of these issues the top priority and looks forward to monthly updates on his team’s progress in resolving them.

“Affordable and accessible health care is a right that every Oregonian deserves, but without stability in our health care system, our state cannot ensure that every citizen is able to exercise that right,” Governor Brown said. “I thank Director Allen and his team for responding quickly. It’s vital that we have a transparent, efficient, and accountable healthcare system because the lives of so many Oregonians depend on it.”

Director Allen’s team learned that erroneous capitation payments (payments made on a per person basis) were made to Coordinated Care Organizations from 2014 through mid-2016 for those who were eligible for both Medicare and Medicaid. This dual eligible population was not correctly categorized due to the limitations of the incomplete Cover Oregon technology and the manual processes put in place to mitigate these limitations. The incorrect categorization also led to OHA receiving too much federal funding for these members.

OHA leadership was made aware of another possible issue that may require repayment to the federal government and the team is analyzing the issue to identify the scope and additional actions.

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Statement from Secretary of State Dennis Richardson:

“I have stated in the past that, from my conversations with citizens across the state, one thing is clear: Oregonians want increased accountability for how their tax dollars are spent. That’s why, on May 17, 2017, my office released our first Audit Alert, notifying the Oregon Health Authority of immediate concerns uncovered during our ongoing audit.

“The Audit Alert flagged millions of dollars of improper payments made for ineligible recipients. During the months that followed, OHA removed more than 54,000 ineligible recipients from their system.

“It has now come to light, thanks to recent reporting by The Oregonian, that OHA additionally misspent more than $74 million of federal Medicaid funds on improper payments. Some of these improper payments must be repaid to the federal government, thereby endangering Oregon’s already precarious budget situation.

“I appreciate the new OHA director’s public disclosure of longstanding mismanagement of taxpayer funds. It’s the first of many necessary steps current leadership should take to improve transparency, efficiency, and accountability to Oregon taxpayers.

“The Secretary of State’s Improper Medicaid Payments Audit report is scheduled to be released in the coming weeks. The thorough findings will reveal the mismanagement and waste of substantial amounts of taxpayer money. Stay tuned for that report.”