National review of Medicaid opioid prescribing not yet feasible

The Office of Inspector General (OIG) has determined that limitations of the national Medicaid claims database, the Transformed Medicaid Statistical Information System (T-MSIS), makes a national review of opioid prescribing in Medicaid unfeasible. The system cannot yet identify all at-risk beneficiaries and providers, the OIG reported (OIG Report, No. OEI-05-18-00480, August 2019).

The OIG assessed the completeness of variables necessary to identify beneficiaries at risk of opioid misuse or overdose and the National Provider Identifiers (NPIs) of providers that ordered and dispensed opioids. According to the report, states were missing data necessary for a national review. Some states did not require NPI to be collected. Others included NPI in their data but incorrectly submitted the data or were unable to transmit the data to T-MSIS because of outdated systems. Without a provider NPI, it is not possible to identify all providers who may be overprescribing opioids and take appropriate action, or to identify providers for investigations of fraud, waste, or abuse, the OIG found.

Identification of beneficiaries can be impeded because a Medicaid beneficiary can have multiple IDs within a state or across states. If a beneficiary does have multiple IDs, prescriptions dispensed to the IDs would appear to be for multiple persons rather than one person. The OIG noted in the report that without a unique beneficiary ID, it is not possible to identify all at-risk beneficiaries in need of opioid-related treatment and conduct proper monitoring of services to protect beneficiaries from inadequate coordinated care.

States also have failed to report diagnoses codes for all services despite being required to do so. Without a diagnosis code, it is not possible to exclude all patients with cancer diagnoses for whom higher doses of opioids may be appropriate or to identify patients’ medical conditions to determine medical necessity for services.

The OIG noted in the report that in August 2018, CMS that all states were submitting T-MSIS data and that CMS was prioritizing T-MSIS data quality. According to the OIG, CMS indicated it would have research files available in 2019. CMS currently has been working with states to improve the quality of data submissions.

Recommendations

The OIG recommended that CMS strive to ensure that individual beneficiaries can be identified at a national level using T-MSIS. CMS should address instances in which a single beneficiary has more than one Medicaid ID within a state. CMS also should prioritize state reporting of prescriber NPIs and issue guidance to clarify the requirements for diagnosis codes.

Medicaid third-party liability changes a challenge for states

The U.S. Government Accountability Office (GAO) conducted a study to see the progress states have made in implementing the changes in third-party liability requirements since the Bipartisan Budget Act of 2018 was passed. The GAO found that the states are unclear on how to collect the required information, update their data systems, and implement the new policies. Adding to the difficulties in understanding and implementing the changes, CMS has issued inconsistent guidance and offers only outdated policy manuals that offer no assistance in implementing the changes (GAO Report, GAO-19-601, August 9, 2019).

Bipartisan Budget Act of 2018

Federal law requires states ensure that Medicaid is the payer of last resort by taking steps to identify Medicaid beneficiaries’ other potential sources of health coverage and their legal liability. The Bipartisan Budget Act of 2018 modified the required processes states must follow when paying claims with probable third-party liability for three types of services. Under the amended statute, states must apply cost avoidance procedures to claims for prenatal care services and pregnancy-related services when it is apparent that a third party is or may be liable at the time the claim is filed. Additionally, states are no longer required to pay claims for pediatric preventative services immediately and may instead require the provider to submit the claim to the third party and wait 90 days (wait-and-see period) for payment before seeking Medicaid payment. Finally, states must make payment for a child support enforcement (CSE) beneficiary’s claim if the third party has not paid the provider’s claim within a 100-day wait-and-see period.

State concerns

According to state officials, several changes to administrative tasks and the Medicaid Management Information System (MMIS) needed to be undertaken to implement the new third-party liability changes and some required research and discussion about the best methods to make these changes. Officials noted that they would need to identify the correct codes in their data systems, establish some sort of indicators in their system to identify which claims were for CSE beneficiaries or had been billed to a third party and when. Some of this additional information would require a data sharing agreement with the state entity maintaining the CSE information while other information would require providers to track down insurance information from a non-custodial parent. Some officials expressed concern that the system changes may require new hardware and system modifications and may make it difficult or impossible to implement the changes, while others discussed waiting for the new MMIS that they were already working to roll out in the future. There were also concerns that the technology changes and the increased administrative work may make the changes not cost-effective to implement.

Stakeholder concerns

Stakeholders were concerned that obtaining accurate information on third-party liability sources for Medicaid beneficiaries and resubmitting claims that result from incorrect or outdated information can be resource intensive and time consuming. Medicaid beneficiaries may be unaware or may not disclose other insurance policies, especially when there are multiple policies by custodial and non-custodial parents or transitions in insurance following birth. Some stakeholders were concerned that rural-based providers may not have the resources to deal with the increased administrative work and delays in payment for services that could result from the payment changes. This may lead some providers to be less willing to serve Medicaid beneficiaries, which would potentially reduce access to care or delay time-sensitive services for children and pregnant women. Some providers may also seek to identify sources of third-party liability before providing services to beneficiaries, which would also delay access to care.

Recommendations

Many states expressed the need for further guidance from CMS on how to implement some of these changes, however, the GAO noted that CMS has issued guidance that is inconsistent with the federal laws and some CMS guidance documents are out of date and not a reliable source of information for states to use in implementing the new requirements. Therefore, the GAO recommended that CMS ensure the agency’s Medicaid third-party liability guidance is consistent with federal law.

The GAO found that CMS has not taken steps to determine the extent to which state Medicaid agencies are meeting the new requirements and indicated that they expect states to comply and will not verify unless the agency is made aware of non-compliance. The GAO recommended that CMS determine the extent to which state programs are meeting federal third-party liability requirements and take actions to ensure compliance where appropriate.

Annual report to HHS for improving Medicare, Medicaid, and related services

HHS should undertake steps to (1) guard against fraud, waste, and abuse, (2) help beneficiaries and providers, and (3) implement better payment policies, according to the Office of Inspector General’s (OIG) annual report on the top unimplemented recommendations from the previous year. While the report ranged far and wide in its recommendations, including a suggestion to the FDA to improve food safety inspections, the bulk of the report was dedicated to addressing fraud, waste, and abuse in Medicare and Medicaid (OIG Report, July 22, 2019).

Background

Each year, the OIG creates a report that focuses on what it contends are the top recommendations for improvement in HHS programs that were not implemented over the past year. This report offers suggestions to both HHS and the FDA on where they should direct their reform efforts for maximum benefit.

The OIG made the following recommendation pertaining to fraud, waste, and abuse.

Inpatient rehab facilities 

In 2013, Medicare paid $5.7 billion to inpatient rehabilitation facilities (IRF) for care to beneficiaries that was not reasonable and necessary. The errors, the OIG said, were due in part to the fact that the payments to the IRFs were not properly aligned with the costs. The current system gives the IRFs a financial incentive to admit patients inappropriately. CMS is apparently evaluating the payment system, which includes a recently issued final year 2019 IRF prospective payment system final rule to update policies and payment rates for fiscal year 2019.

‘Least costly alternative’ Part B drugs

If the least costly alternative requirement had not been rescinded for Part B drugs, Medicare would have saved $33.3 million in one year ($264.6 to $231.3 million). Once the requirement was removed, utilization patterns shifted dramatically in favor of costlier products.

Part D drug oversight

Medicare Part D spending on compounded topical drugs soared from $13.2 million in 2010 to $232.5 million in 2016. Questionable billing practices seem to be concentrated in a few metropolitan areas. OIG has identified prescribers with troubling order patterns. States are hamstrung in their ability to prevent drug overpayments. State agencies need to know the 340B ceiling prices and which Medicaid claims are associated with 340B drugs to ensure that the claims are paid correctly.

Managed care organization improvements

OIG believes that a significant amount of underreporting of fraud and abuse is occurring in Medicaid involving managed care organizations. For example, even where a managed care organization discovers fraud or abuse, OIG says that it will handle the situation by itself (terminating the contract) rather than report it to CMS. CMS must do more to ensure that the organizations identify and refer fraud and abuse to the state.

Help beneficiaries and providers

In addition, the OIG recommended that CMS analyze the impact of counting time as an outpatient toward the 3-night requirement for skilled nursing facility services (SNF). Beneficiaries with similar post-hospital care needs have different access to SNF services depending upon whether they were outpatients or inpatients because of the requirement that the beneficiary spend at least three nights as an inpatient to obtain post-hospital SNF Medicare coverage. Furthermore, CMS paid an estimated $84.2 million in improper payments between 2013 and 2015 because SNFs incorrectly determined whether the 3-night requirement was met. CMS should consider changes to make the system fairer, which could include counting time as an outpatient.

FDA

The OIG had a single recommendation for the FDA, noting that deficiencies exist in the FDA’s electronic recall data system. The FDA relies too much on voluntary corrections by facilities. Just over half the facilities that were inspected and should have received warning letters actually received warning letters. The FDA also frequently fails to conduct timely follow-up inspections to ensure compliance. The OIG suggested that the FDA act to address these shortcomings.

Kusserow on Compliance: Many states are not in compliance with mandates to conduct provider criminal background checks

CMS required all states to conduct criminal background checks on high-risk providers before allowing them to receive Medicaid payments by July 2018. CMS could consider as overpayments any payments made to high-risk providers in those states that have not undergone a criminal background check. Those providers must return to CMS the federal share of those overpayment. The OIG found that 18 states failed to comply with the requirement by a CMS deadline of July 2018 and 13 still had not complied as of January 1, 2019. States cited three reasons for not complying:

  1. A lack of authority:Three states said their Medicaid agencies did not have proper oversight power for these background checks, requiring legislative or executive action to do this.
  2. A lack of resources:One state reported it did not have the necessary staff to do the background checks.
  3. A lack of criteria to determine “high-risk providers”: One state said it was actively revising its criteria based on concerns from the provider community, delaying compliance.

The OIG recommended CMS to (1) ensure all States fully implement fingerprint based criminal background checks for high-risk Medicaid providers; (2) amend its guidance so that states cannot forgo conducting criminal background checks on high risk providers applying for Medicaid, unless Medicare has conducted the checks; (c) compare high risk Medicaid providers’ self-reported ownership information to Medicare’s provider ownership information to help states identify discrepancies. CMS concurred with the first recommendation.

 

Richard P. Kusserow served as DHHS Inspector General for 11 years. He currently is CEO of Strategic Management Services, LLC (SM), a firm that has assisted more than 3,000 organizations and entities with compliance related matters. The SM sister company, CRC, provides a wide range of compliance tools including sanction-screening.

Connect with Richard Kusserow on LinkedIn.

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Copyright © 2019 Strategic Management Services, LLC. Published with permission.