‘Not acceptable, whatsoever’: Medicaid mismanagement draws lawmaker scrutiny

Up to $483 million in erroneous 2019 payments due to unaddressed issues at Colorado health care policy department

Two-month-old Karina receives drops of children's Tylenol after getting a vaccination at Rocky Mountain Youth Clinics in 2009 in Aurora. Many of the clinic's patients are on Medicaid. (John Moore/Getty Images)

Colorado state lawmakers grilled leaders of the Department of Health Care Policy and Financing on Friday regarding a slew of serious noncompliance issues related to Medicaid, the state’s low-income health insurance plan.

As of June 2020, HCPF had 17 noncompliance issues — 14 of which are deemed high priority — the highest number of any state agency, according to an annual report released by the Office of the State Auditor in December. State auditors presented the overdue issues relating to Medicaid coverage and eligibility, provider certification and general oversight to lawmakers on Jan. 22 during the department’s annual SMART Act hearing.

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“There’s one high recommendation that has gone unanswered for eight years since 2013,” said state Rep. David Ortiz, a Littleton Democrat and U.S. Army veteran, during the committee meeting. “Let me tell you how that would fly in the military: not acceptable. Not acceptable, whatsoever.” 

“There’s one high recommendation that has gone unanswered for eight years since 2013. Let me tell you how that would fly in the military: not acceptable. Not acceptable, whatsoever.”state Rep. David Ortiz, a Littleton Democrat and U.S. Army veteran 

The majority of the issues were related to medicaid eligibility and were first identified in a 2017 audit report. Auditors estimated that between 2% and 10% of the total number of people who received Medicaid benefits over the fiscal year were ineligible for the program. Meaning, the department distributed between $80 million and $483 million in erroneous payments. 

“We recommended that the department improve its controls over eligibility of Medicaid beneficiaries by training and monitoring counties and medical assistance aides, and resolving system issues to ensure payments are only made on behalf of eligible people in compliance with federal and state regulations,” said Pooja Tulsian, a legislative audit manager with the auditor’s office, during the Jan. 22 meeting. 

Tulsian explained to lawmakers during questioning that if the issues are not addressed, the state’s federal funding for the program could be jeopardized.

Agency blames overdue audit recommendations on lack of funding, too many audits going at once 

Kim Bimestefer, executive director for the Colorado Department of Health Care Policy and Financing. (colorado.gov)

Kim Bimestefer, executive director of HCPF since 2018, said the department has made “tremendous” progress in the last six months to resolve the issues. Since the state auditor’s report was drafted in June, she said her department has implemented five out of the 17 recommendations. She said the rest will be implemented by July 2021 or July 2022. 

Originally, the majority of the issues were supposed to be resolved by 2018 or 2019. The remaining ones had deadlines for 2017 and 2013. The longest outstanding recommendation, which got the most attention during the meeting and has been pending since 2013, is related to personnel costs for federal programs. Bimestefer said the delay is due to the need for an entirely new system and collaboration with other state agencies.

“We take all the state auditor’s comments very seriously and we’re committed to addressing them,” Bimestefer said. “We’re balancing a lot of things, and they are very important. We have accomplished many of them and I apologize for the delays with some of them and you have my commitment to address them.”

State Sen. Barbara Kirkmeyer, a Weld Republican and former county commissioner, expressed concern during the meeting that HCPF’s presentation to lawmakers was focused too much on their successful performance measures and not enough on the serious noncompliance issues. 

Nearly 100 recommendations from Colorado’s audit office have yet to be implemented

Rep. Richard Holtorf, an Akron Republican, expressed similar concerns. “Director Bimestefer, I hate to be the skunk at the picnic, but I think you’re missing something here,” he said.

When pushed, Bimestefer blamed the delays on the fact that the agency has had to balance dozens of state and federal audits happening simultaneously. “At any one time, our department has 20 to 25 audits going at the same time. Our state audit is just one of them,” she said. 

She also pointed to lack of funding as a barrier to resolving the issues.

“We specifically asked at the last round of budget requests that we need more compliance individuals,” Bimestefer added. “We originally got a few and then they were taken away when the budget requests were adjusted. So, yes, we do need resources for this, we need compliance resources.”

Auditor’s office lacks authority to force agencies into compliance

During the meeting, Ortiz asked Tulsian, the state auditor, if there will be any individual consequences for leaders within HCPF regarding the issues highlighted in the audit report.

“That would be a good question for the department,” Tulsian said. “The purpose of this hearing is to give the legislators a chance to question the department. So, I would definitely ask the department why there has been a delay in implementing these recommendations, especially the one that has been out there for almost eight years now.”

The Colorado State Capitol Building on Oct. 15, 2020. (Moe Clark/Colorado Newsline)

State Rep. Iman Jodeh, a newly elected Aurora Democrat, echoed Ortiz’s concerns, asking the state auditor what her office has done to hold HCPF accountable for their unimplemented recommendations.

“So, again, this would be a question I would definitely ask the department,” Tulsian reiterated, “… how they are planning to implement and by when they are really, realistically planning to implement this recommendation that has been out there for so long.”

Ortiz, who is also a first-time state lawmaker, said on Monday that he’d like to see more accountability.

“I might be new but if the same conversations keep happening over and over again that’s not something that I’m going to be very patient with,” he said. “We need to be putting together real solutions and if that means that we as legislators need to own more of that discussion and put more onus on us, well, I feel like that’s what we were elected to do.”

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