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GAO Recommends Provider-Level Medicaid Reporting, Payment Evaluation

The Centers for Medicare & Medicaid Services (CMS) lacks adequate data to conduct provider-level oversight of Medicaid payments, according to a study released May 11 by the U.S. Government Accountability Office (GAO). The study found that provider-level data on supplemental Medicaid payments were not adequate to determine whether Medicaid payments are being used for Medicaid-eligible patients in an economical and efficient manner.

GAO’s analysis of Illinois and New York Medicaid payments found inconclusive trends and a large range in estimates of average daily payments for both public and private hospitals. Across both states, GAO found that 10 of the 16 hospitals evaluated received Medicaid payments exceeding Medicaid inpatient costs. In response to these findings, GAO recommended CMS adapt its evaluation processes to determine whether individual providers are receiving appropriate payments. To accomplish this, GAO recommended that CMS take steps to ensure states report provider-level payment data and establish criteria for assessing payment appropriateness.

GAO acknowledged in the report that trends found are not generalizable to other states and hospitals. GAO used general Medicaid and upper payment limit (UPL) supplemental payments to conduct its analysis but did not include disproportionate share hospital (DSH) payments. DSH payments were not included because providers are not required to differentiate between whether the payments are used for Medicaid or uninsured patients. Additionally, claims data for hospital outpatient costs could not be used to accurately determine payments per visit, as outpatient claims for bundled payments did not include the number of patient visits per claim.

Contact Beth Feldpush, DrPH, senior vice president of policy and advocacy, at bfeldpush@essentialhospitals.org or 202.585.0111 with questions.

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About the Author

Matt Buechner is the policy and advocacy associate for America's Essential Hospitals.

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