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Salem, OR—Today, an audit focusing on the information technology system used to enroll Oregon Medicaid patients was released by Secretary of State Dennis Richardson. The audit concluded that the state's automated systems appropriately processed Medicaid eligibility determinations and provided appropriate payments to Coordinated Care Organizations. However, auditors also reported that improvements are needed to increase the accuracy of inputs from Medicaid applications, and the Oregon Health Authority (OHA) should improve its review of overrides of eligibility to better comply with Medicaid eligibility requirements and increase overall accuracy of payments. The costs and consequences of inaccurate manual application input and inappropriate use of the override of eligibility capability will be specifically addressed in a subsequent audit, and a preliminary Auditor Alert on those topics was sent last week.

“Although the IT system examined in this audit appears to be performing well, an IT system is only as good as the data fed into it. OHA's negligence regarding inaccurate inputs and eligibility overrides is putting tens of millions of dollars at risk,” said Secretary of State Dennis Richardson. “Inappropriate payments and improper overrides need to end so that we can redirect savings to help the most vulnerable Oregonians.”

Today's audit report evaluated the new Oregon Eligibility System (ONE). This new system was implemented in December 2015 to determine eligibility of Medicaid clients under the requirements of the federal Patient Protection and Affordable Care Act. ONE passes Medicaid eligibility determinations to the Medicaid Management Information System (MMIS), which auto-enrolls clients in Coordinated Care Organizations as needed. MMIS then uses a combination of eligibility information, client demographics, and enrollment data to determine and process monthly capitated payments to the Coordinated Care Organizations.

Auditors examined records of over 425,000 individuals within ONE and found that automated validation of social security numbers and citizenship status worked correctly over 99.7% of the time. However, Medicaid applications are also entered into ONE through manual input and some information requires manual verification.

To evaluate the accuracy of manual input and verification, auditors conducted a detailed review of 30 individuals, comparing the information in ONE to their Medicaid applications. This review found seven cases with input errors. Three of the errors affected the eligibility determination, and one error resulted in inappropriate payments totaling $1,778 over four months. Although the other errors were minor, they were related to application information that had the potential to affect eligibility determination or the benefit start date.
Under specific circumstances, OHA caseworkers may override the eligibility determination made by ONE. Auditors found that OHA does not sufficiently monitor these overrides or ensure they are appropriately cleared. As a result, instances of over and underpayment to providers were found.

Auditors also examined over six million payment transactions made January - June 2016. They found that payment amounts were correct based on the information received from eligibility systems. Auditors also determined that MMIS properly enrolled individuals in Coordinated Care Organizations and had a reconciliation process in place to identify potential enrollment errors.

It is also a concern that 2011 audit recommendations to OHA and DHS regarding access to MMIS have not been fully implemented, which increases the security risks.

Read the complete Secretary of State audit

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