Auditor reviewing January Medicaid audit

State Auditor Beth Wood says her office has "a number of concerns" following questions raised during a recent DHHS oversight hearing regarding an audit of the Medicaid system released in January.

Posted 8:34 p.m. Oct 9, 2013 — Updated 5:06 p.m. Oct 10, 2013

Mark Binker

RALEIGH, N.C. — State Auditor Beth Wood said Wednesday that she is reviewing details related to a report that her office issued in January following questions raised during a legislative oversight hearing Tuesday.

That January audit alleged inefficient management and lax oversight had led to higher-than-usual administrative costs in the state Medicaid program.

But a report published on the nonprofit news site North Carolina Health News earlier this week suggested Department of Health an Human Services officials deliberately failed to defend their agency against the report's allegations. Specifically, early drafts of a response to the audit would have shown North Carolina's administrative costs were some of the lowest in the country, taking a bite out of the audit's most severe criticism. That information was edited out of the final draft.

Health policy experts pointed out that discrepancy at the time, but Gov. Pat McCrory, a Republican who took office in January, and other officials in his administration have repeatedly leaned on the audit to show they have inherited "a broken system" from Gov. Bev Perdue, a Democrat. McCrory has been pushing for a broad reform of the system, which may include allowing private managed care companies to handle the state's Medicaid caseload.

During Tuesday's oversight hearing, Health and Human Services Secretary Aldona Wos said she had not seen the new report but said she stood by what her agency had to say at the time.

Asked why the agency revised its initial response, drafted by bureaucrats that worked for the Perdue administration, Wos said there was nothing unusual about that.

"The responses to the audit were based on a fresh pair of eyes," she said in response to a question. "We wrote our response and stand by it."

But in an email statement Wednesday, Wood said enough information was called into question at Tuesday's hearing to warrant a second look.

"Our office has a number of concerns about information provided yesterday to the Joint Legislative Oversight Committee for Health and Human Services and about recent news reports relating to our January Medicaid audit. We are currently reviewing information from each of these sources and will soon provide a detailed response to questions about our work," she said.

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