Full Audit Report 2022-S-421.1 MB

Objective

To determine if the Department of Health (DOH) improperly paid Medicaid managed care premiums on behalf of members who resided outside of New York. The audit covered the period from July 2017 through October 2024.

About the Program

DOH administers New York State’s Medicaid program. Medicaid members must be residents of New York to receive benefits. Individuals enroll in Medicaid through the NY State of Health (NYSOH, the State’s online health insurance marketplace) or through Local Departments of Social Services (Local Districts). Medicaid eligibility determination systems are required to routinely provide data to be sent through the federal Public Assistance Reporting Information System (PARIS). PARIS is a service that conducts matches on the enrollment data of public assistance programs—including Medicaid—across all 50 states, the District of Columbia, and Puerto Rico to determine if an individual is receiving duplicate benefits in more than one location. PARIS uses a beneficiary’s Social Security number (SSN) as the unique identifier for matches.

Most of the State’s Medicaid members are enrolled in managed care plans, which are responsible for ensuring members have access to a range of health care services and reimbursing providers for those services. In exchange, DOH pays the plans a monthly premium for each enrolled member. If a member who is enrolled in a managed care plan no longer resides in New York, they should be disenrolled from their plan and the plan must return premiums paid for periods when the member was not a resident.

Key Findings

We found various issues with the State’s identification of members who resided outside of New York, some of which DOH rectified during the audit. Among the issues, we identified additional data sources DOH could use to complement the PARIS match and certain review processes for PARIS matches that needed improvement. Together, these indicated Medicaid paid almost $1.2 billion in managed care premiums for Medicaid members who may have resided outside of New York. Additionally, most Medicaid members are enrolled through NYSOH, yet we found DOH did not start submitting NYSOH-enrolled member data for PARIS matching until May 2017 (nearly 3 years after NYSOH started). Then, DOH did not start reviews of the NYSOH PARIS match results until more than 2 years later in October 2019 and, as a result, $1.5 billion in premiums was paid from 2017 to 2019 on behalf of unreviewed members. Overall, Florida, New Jersey, and Pennsylvania represented the other state residencies for 35% of the premium payments in our total audit results. Following is a breakdown of the $1.2 billion in findings:

• $509 million represented premiums paid for 155,181 members who may have resided outside of New York according to data sources other than PARIS, such as the U.S. Postal Service’s National Change of Address (NCOA) information.
  • For example, a member appeared on a May 2020 NCOA report with a forwarding address in Florida. The member had no Medicaid services since February 7, 2020, but Medicaid made 45 monthly premium payments totaling $100,859 on behalf of the member from June 2020 through February 2024. The member was still active and enrolled in managed care as of the end of the audit fieldwork.
  • In response to the audit findings, DOH agreed to explore the use of other data sources, including NCOA, to identify out-of-state members. We further suggest DOH engage with the federal government about its willingness to incorporate other data that helps establish residency into the PARIS matching process at the federal level.
• $375 million represented premiums paid for NYSOH-enrolled members who were identified on a PARIS match but were not reviewed by DOH to confirm residency because of flaws in NYSOH’s processing of PARIS matches that caused the omissions. Also, 631,514 NYSOH-enrolled members were not submitted for a PARIS match because their SSNs were incorrectly logged in NYSOH as unverified. As a result of the audit, DOH identified the cause of the NYSOH error and officials stated a solution was implemented in March 2024.
• $299 million represented premiums paid for members whose eligibility was ended due to PARIS matches but the improper premiums were not recovered ($234 million), or the member’s eligibility was flagged to be closed but was not officially ended and premiums continued to be made ($65 million).
• While all states, the District of Columbia, and Puerto Rico participate in the PARIS match, not all of them participate every quarter, which can impact the effectiveness of the identification of out-of-state members.

Key Recommendations

• Verify the residency of members identified by a PARIS match who were not reviewed, as well as members identified as potentially residing outside of the State by data sources other than PARIS, and recover improper premium payments, as appropriate.
• Review the $299 million in premium payments for members whose eligibility was closed or not properly closed, and make recoveries, as appropriate.
• Enhance processes used to identify members living outside of the State and recover improper premium payments.