Legislative auditor takes another swing at Medicaid vetting

The Louisiana legislative auditor has again rapped the Department of Health for not doing enough to keep ineligible people off the Medicaid rolls.
The auditor says the department has so far failed to incorporate federal tax information in its new automated eligibility-verification system known as LaMEDS, after setting a goal to do so by early this summer.
The Louisiana Department of Health still is considering using automated federal tax data. But IRS privacy rules may make the change cost-prohibitive, LDH says in its response to the auditor’s report.
LDH says it would have to establish a team dedicated to submitting and reviewing background checks for all 2,600 LaMEDS users, which includes department employees and private-sector partners.
The department also would have to upgrade the various offices where LaMEDS is used, LDH says.
For example, the IRS requires anyone with access to federal tax information be housed in a windowless office behind a locked door, but most employees currently are in open office settings with cubicles.
However, the department says “great strides have been made” in using federal tax data in post-eligibility case reviews. LDH plans to have approved staff manually review federal information that is sent to a secure environment outside of LaMEDS.
If utilizing automated federal tax data is cost-prohibitive, LDH should explore using state tax data in LaMEDS instead, the auditor recommends. The department says it would work with the Louisiana Department of Revenue to see if that would be “practical and permissible,” though reports indicate previous attempts have not been productive.
“According to LDH, the manner in which the information was shared by LDR limited its usefulness in making eligibility determinations,” the auditor said.
“Instead of receiving a full data set of tax information, LDR only allowed LDH to make specific requests about particular individuals.”
The auditor’s office says the legislature may wish to consider moving all or part of the Medicaid eligibility function to the Department of Revenue, since LDR already has an IRS-approved secure environment and is experienced in the security and use of federal tax information.
The new report is only the latest of several by the legislative auditor critical of how LDH manages the state’s Medicaid program, which provides health insurance to low-income residents and is primarily funded by federal tax dollars.
Just last week, the auditor criticized LDH for not ensuring the managed care organizations that handle provider payments don’t pay more than is called for in the department’s fee schedule.
LDH said the auditor’s criticisms are “inconsistent with the managed care model of health care.”
“Beyond minimum standards, states allow MCOs to pay their providers higher than [the minimum rate],” said LDH Undersecretary Cindy Rives.
“With provider reimbursement being among the most critical factors contributing to provider participation in MCOs, this flexibility enables MCOs to maintain an adequate network, particularly in rural areas and for provider types in short supply.”
LDH reports to Gov. John Bel Edwards, a Democrat who is running for re-election this year. The legislative auditor answers to the Louisiana Legislature, which is majority Republican.