For the Medicaid  program, this system is the Medicaid Management Information System  (MMIS). Provider enrollment and pre- and post-payment claims data review  activities, and the MMIS subsystems that support them, were designed  primarily to address program integrity goals of states’ delivery of fee-for- service health care to Medicaid beneficiaries. Ten Selected States Rely on a Variety of Systems to Support Program Integrity

All 10 of the states in our study had implemented MMIS subsystems to  support their program integrity efforts. Three states reported that they  were operating MMISs that were implemented more than 20 years ago,  while 7 states had upgraded their subsystems in the past 13 years, and 2  of those reported having done so in the past 2 years. Further, 7 states  had, in the past 10 years, implemented other new and more advanced  systems, in addition to their MMISs, to meet specific needs related to  enrolling providers and processing claims data. CMS Provides Data, Technical Guidance, and Funds to Help States Enhance Medicaid Program Integrity, but Most of the Selected States Do Not Measure Systems’ Effectiveness

In accordance with federal laws and agency program integrity plans, CMS  takes steps to support states’ efforts to implement information systems  that help prevent and detect improper payments in the Medicaid program. According to CMS officials with Medicaid Integrity Institute, the agency  determines state Medicaid administrators’ needs for continuing education  based on information collected by surveys administered during training  sessions. States can request and receive funds to cover up to 90 percent of these  costs, depending upon the extent to which their plans for implementing  the systems meet certain technical specifications and requirements  defined by CMS, including those defined for the implementation of system  functionality to support efforts to prevent and detect improper payments. that support Medicaid administration.federal matching funds these states received. For its part, CMS has not required the states to identify and report on the  outcomes and effectiveness of systems used for program integrity  purposes. Without identifying and measuring the  financial benefits (i.e., money saved or recovered) that result from using  their MMISs and other systems, CMS and state Medicaid administrators  cannot be assured of the systems’ effectiveness in helping to prevent and  detect improper payments. Moreover, without having required states to  institute consistent and repeatable approaches for measuring and  reporting such outcomes, CMS Medicaid officials lack an essential  mechanism for ensuring that the federal financial assistance that states  receive to help fund the operations and maintenance of these systems is  an effective use of resources to support Medicaid program integrity  efforts. Selected States and CMS Have Taken Steps to Overcome Challenges with Using Systems to Analyze Managed Care Data

Even as the selected states rely on their systems to help prevent and  detect improper Medicaid payments, five of the seven states in our study  that administered Medicaid as both fee-for-service and managed care— North Carolina, Texas, Virginia, California, and Maryland—faced  challenges that were specific to the use of their systems for ensuring the   These challenges introduced  integrity of their managed care programs.limitations in the states’ ability to use their systems to analyze managed  care encounter data because of the (1) content of the data reported, (2)  quality of the data submitted, or (3) inconsistencies between the ways  managed care and fee-for-service data values are defined. However, the effectiveness of the systems for program  integrity purposes is unknown. Recommendation for Executive Action

To ensure that the federal government’s and states’ investments in  information systems result in outcomes that are effective in supporting  efforts to save funds through the prevention and detection of improper  payments in the Medicaid program, we recommend that the Secretary of  HHS direct the Administrator of CMS to  require states to measure quantifiable benefits, such as cost  reductions or avoidance, achieved as a result of operating information  systems to help prevent and detect improper payments. Appendix I: Objectives, Scope, and Methodology

The objectives of our review were to determine (1) the types and  implementation status of the information systems used by states and  territories to support Medicaid administrators’ efforts to prevent and detect  improper payments to providers; (2) the extent to which the Centers for  Medicare & Medicaid Services (CMS) is making available funds, data  sources, and other technical resources to support Medicaid programs’  efforts to implement systems that help prevent and detect improper  payments to providers, and the effectiveness of the states’ systems; and  (3) key challenges, if any, that Medicaid programs have faced in using IT  to enhance program integrity initiatives, and CMS’s actions to support  efforts to overcome these challenges.
Why GAO Did This Study

Medicaid is a joint federal-state program that provides health care coverage to certain low-income individuals. The program is overseen by CMS, while the states that administer Medicaid are tasked with taking actions to ensure its integrity. Such actions include implementing IT systems that provide program integrity analysts with capabilities to assess claims, provider, beneficiary, and other data relevant to Medicaid; and supporting efforts to prevent and detect improper payments to providers.
GAO was asked to review states' implementation of IT systems that support Medicaid. GAO determined (1) the types and implementation status of the systems used by states to support program integrity initiatives; (2) the extent to which CMS is making available data, technical resources, and funds to support Medicaid programs' efforts to implement systems, and the effectiveness of the states' systems; and (3) key challenges that Medicaid programs have faced in using IT to enhance program integrity initiatives, and CMS's actions to support efforts to overcome them. To do this, GAO analyzed information from 10 selected states covering a range of expenditures on such systems, reviewed program management documentation, and interviewed CMS officials.

What GAO Found

In the 10 selected states reviewed, GAO found the use of varying types of information technology (IT) systems to support efforts to prevent and detect improper payments. All 10 states had implemented a Medicaid Management Information System (MMIS) to process claims and support their program integrity efforts, and 7 had implemented additional types of systems to meet specific needs. Three states were operating MMISs that were implemented more than 20 years ago, but 7 states had upgraded their MMISs, and 2 of those had done so in the past 2 years. In addition, 7 states had implemented other systems, such as data analytics and decision support systems that enabled complex reviews of multiple claims and identification of providers' billing patterns that could be fraudulent. While the MMISs and other systems implemented by the 10 states were designed primarily for administering Medicaid as a fee-for-service program, in which providers file claims for reimbursement for each service delivered to patients, officials with 7 of the 10 states also administered managed care plans–plans for which provider organizations are reimbursed based on a fixed amount each month–and 1 state administered Medicaid exclusively as managed care. Officials with the 9 states who administered fee-for-service plans said they used their systems to help conduct pre- and post-payment reviews of claims.
All 10 states received technical and financial support from the Centers for Medicare & Medicaid Services (CMS) for implementing the systems. For example, they accessed the agency's databases to collect information that helped determine providers' eligibility to enroll in Medicaid. In addition, all 10 states had participated in training, technical workgroups, and collaborative sessions facilitated by CMS. With the agency's approval, the 10 states received up to 90 percent in federal matching funds to help implement systems. All 10 states reported that agency support, particularly training, helped them to implement systems needed to prevent and detect improper payments.
However, the effectiveness of the states' use of the systems for program integrity purposes is not known. CMS does not require states to measure or report quantifiable benefits achieved as a result of using the systems; accordingly, only 3 of the 10 selected states measured benefits. Without identifying and measuring such benefits (i.e., money saved or recovered) that result from using MMISs and other systems, CMS and the states cannot be assured of the systems' effectiveness in helping to prevent and detect improper payments. Moreover, without requiring states to institute approaches for measuring and reporting such outcomes, CMS officials lack an essential mechanism for ensuring that the federal financial assistance that states receive to help fund these systems effectively supports Medicaid program integrity efforts.
Five of the 10 states faced challenges with using systems for managed care program integrity–introduced by the content, quality, and definitions of data on services provided. However, 1 state had taken steps to overcome such challenges and had integrated data and implemented functionality needed to review managed care data both prior to and after payment. For its part, CMS had conducted training related specifically to collecting and analyzing these data to help prevent and detect improper payments in the Medicaid program.

What GAO Recommends

GAO recommends that CMS require states to measure and report quantifiable benefits of program integrity systems when requesting federal funds, and to reflect their approach for doing so. The agency agreed with the recommendation.