Lawmakers deliver five questions to CMS regarding Medicaid asset verification

House Energy and Commerce Committee Chairman Fred Upton (R-Mich) and Senate Finance Committee Chairman Orrin Hatch (R-Utah) noted their concerns with CMS’ apparent lack of oversight of states’ implementation of electronic asset verification systems for aged, blind, and disabled populations under Medicaid. In a letter to Andy Slavitt, Acting Administrator of CMS, the legislators pointed to the HHS Agency Financial Report, which detailed that in fiscal year 2015 Medicaid had an improper payment rate of 9.78 percent overall and 10.59 percent in fee-for-service Medicaid, as basis for their concerns (see Expanded health care access, opioid abuse control among HHS’ 2015 accomplishments, Health Law Daily, November 20, 2015).

According to the CMS’ Office of the Actuary, in 2013, there were over 15 million individuals enrolled in Medicaid on the basis of being disabled or age 65 or over. Medicaid expenditures for this population totaled nearly $260 billion in 2013, with the program spending on average over $17,000 per disabled enrollee and $15,000 per aged enrollee. This population constitutes only 26 percent of Medicaid enrollees but accounts for 64 percent of the program’s expenditures.

Asset verification

The legislators are pressing CMS to provide status updates for each state’s electronic asset verification systems’ implementation and seeking answers to questions about the extent to which the assets are verified for the systems already in place. In 2008, the Supplemental Appropriations Act (P.L. 110-252) required states to implement electronic asset verification systems to verify the assets of aged, blind, and disabled Medicaid applicants. The law specified that states implement these systems on a rolling basis.

Based on CMS guidance for implementing the law 25 states should have implemented their electronic asset verification systems by the end of fiscal year 2011. However, the Government Accountability Office (GAO) reported that no states had implemented such a program as of November 2011. A May 2014 GAO report indicated that only two of 12 states that had been interviewed reported having such a system in place, despite the fact that all states were supposed to have implemented one by the end of fiscal year 2013.

The lawmakers asked CMS to answer questions regarding:

  1. status of states’ implementation of electronic asset verification systems, specifically which states have implemented systems and date of implementation;
  2. for states that implemented electronic verification systems, what proportion of aged, blind, and disabled applicants’ assets are verified through these systems, and what, if any data is available have electronic asset checks led to the discovery of unreported assets;
  3. for states that have not implemented electronic asset verification systems, what is the status of these states’ corrective action plans;
  4. extent of CMS’ withholding of federal matching funds as a result of states’ noncompliance, specifically which states, time frames of withholding, and the amount withheld; and
  5. any action undertaken by CMS to assist states in coming into compliance with the electronic asset verification system requirements.