Audit: County offices still making Medicaid mistakes

Posted January 12

— North Carolina's Department of Health and Human Services needs to do a better job of making sure counties follow the rules when they figure out if someone is or is not eligible for the Medicaid health insurance program, an audit released Thursday reports.

State Auditor Beth Wood said the issues identified by her office have been ongoing over the course of at least three gubernatorial administrations and have remained despite a number of changes to how North Carolina's Medicaid system operates.

In large part, Wood said, the problem has persisted because the state outsources the process of determining who is and is not eligible for coverage to county departments of social services. While the state set rules for how those offices should handle claims, she said, DHHS does little to ensure counties are following the rules.

"We sat back and let them do it however they chose to do it," Wood said.

The result, she argues, is an eligibility process that varies between the state's 100 different counties. Differences are so pronounced, she said, that it's impossible to provide a statistically accurate statewide picture of how the eligibility process is operating.

Her office's report examined data from 10 counties between July 1, 2015, and June 30, 2016. Among its findings were:

  • Guilford County made mistakes when determining who should or should not get Medicaid coverage with 18.8 percent of new applications.
  • Wake County processed 26 percent of new applications too slowly.
  • Mecklenburg County made mistakes 23.2 percent of the time when determining whether individuals currently receiving Medicaid should remain in the program.

​"While the Department believes that we have provided clear guidance and direction to county departments of social service, it is clear that these efforts have not resulted in the desired outcomes," reads a letter from DHHS Secretary Rick Brajer, who served under former Gov. Pat McCrory.

Contacted Thursday, DHHS Spokeswoman Kendra Gerlach said the department appreciated the findings.

"Although Medicaid eligibility processing is carried out through counties, DHHS recognizes that we are ultimately accountable," Gerlach said. "We've begun work to implement the recommendations of the auditor and are working closely with county leaders including directors of Social Services and the Association of County Commissioners to address these issues."

During the McCrory administration, North Carolina spent millions of dollars on a new computer system, NC FAST, to make faster and more accurate determinations across a variety of benefit programs, including Medicaid. The state also has undertaken a Medicaid reform effort that will change from paying doctors from each procedure performed to a program under which doctors profit by keeping patients healthy.

Other reports, including a recent examination by the state legislature, have found problems in curbing fraud and other abuses in the Medicaid program.

Taken as part of the larger picture, Thursday's audit report is unlikely to make Republican lawmakers in control of the General Assembly any more eager to compromise with Democratic Gov. Roy Cooper, who wants to expand Medicaid coverage to more people.

The report also points to a problem that will likely remain whether President-elect Donald Trump's administration brings big changes to the program or not. The eligibility system is a "front door" to the program, one that Wood argues hasn't worked properly for years.

"This is not going away, no matter what kind of Medicaid reform comes to North Carolina," Wood said. "The eligibility determination has got to happen correctly. DHHS is not holding (counties') feet to the fires and making them do it."

Possible solutions, she said, would include making counties responsible for reimbursing the federal government for costs associated with those who were granted Medicaid coverage but weren't eligible. That's a cost that currently comes out of the state's budget.


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  • Kim Anderson Jan 12, 2017
    user avatar

    I hope they do an audit of the foster care system in Wake County after they continue to look into Medicaid. Yes, Im glad too that Beth Woods got re-elected because she does take the auditing very seriously. Im hoping along with her, Cooper, and Trump they can figure out what is going on with NC DHHS and DSS Swinburnie office in Raleigh. They continue to take children and place them in foster care all at our expense. You have the social workers that work out of multiple offices Raleigh, Cary, and Fuquay to name a few VERY CORRUPT offices. They fabricate stories to the leading Judge in Abuse Neglect and Dependency courtroom 4C who then orders the removal of children from parents, grandparent, and family member all because the social workers are upset with them. They threaten these families with termination of parental rights. The Judge(SHE) knows that its all a lie! Fed sends them a check and the kids are placed on medicaid until they age out of a BROKEN SYSTEM. PLEASE AUDIT THAT

  • Stacie Hagwood Jan 12, 2017
    user avatar

    A. I am so glad she was re-elected. She has been such a great asset to our state. (At least there are two....Steve Troxler is another). I also appreciate that she pointed out that it has been an ongoing problem for over a decade; i.e.,: the state level has not been doing its job.
    B. I can't help but wonder whether and how complicated it might be to comply with state laws; whether there is sufficient manpower to handle the load; whether there is, indeed, a fraud issue from an employee standpoint in some counties. Broken system? Absolutely. But why?

  • Jerry Powell Jan 12, 2017
    user avatar

    I wonder if these applicants are using the same interpreters who already know the answers that they want to hear to get approved?

  • Amber Perry Jan 12, 2017
    user avatar

    And yet the Dems want to expand medicaid. Sounds like a great idea.

  • Jason Galarneau Jan 12, 2017
    user avatar

    So, how much did this cost us? %'s don't mean anything without being quantified. Guessing we got hosed