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Colorado Paid Millions in Medicaid Benefits for Deceased People

In a recent audit, it was revealed that the State of Colorado has paid millions of dollars in Medicaid benefits for individuals who were no longer alive. This startling discovery has raised concerns about the efficiency and oversight of Medicaid payments in the state.


The Audit Findings According to the Office of Inspector General (OIG), Colorado paid insurers at least $7.3 million for services provided to deceased Medicaid recipients (1).


This amount includes approximately $3.8 million in federal funds (2). The payments were made as capitation payments, which are fixed amounts paid per enrolled individual over a set period, regardless of whether the individual uses the healthcare services.

How Did This Happen? The audit found that in many cases, data from the Social Security Administration's Death Master File showed that a Medicaid enrollee had died, but Colorado's system did not reflect this information (3). In some instances, the state was aware of the deaths but still processed the payments. The lack of an automated system to check for deaths contributed to these erroneous payments.


The Colorado Department of Health Care Policy and Financing (HCPF) has disputed some of the findings, arguing that the OIG's approach was inadequate. They claim that the OIG used state and federal records without verifying the information directly with the enrollees (1). The HCPF also stated that they have been using an automated payment system since 2019 and have attempted to recoup the payments made in error (3).


This issue highlights the need for better oversight and more robust systems to prevent such errors in the future. The state has agreed to some of the terms proposed by the OIG to address these issues (3).


However, the HCPF has indicated that they will spend time disputing the estimates with the Centers for Medicare & Medicaid Services rather than attempting to recover the unallowable payments (3).


Conclusion The revelation that Colorado paid millions in Medicaid benefits for deceased individuals underscores the importance of accurate data management and oversight in public health programs. As the state works to address these issues, it is crucial to ensure that taxpayer money is used efficiently and effectively.

 
 
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