Faulty Medicaid system paid out $11 million to deceased residents in Rhode Island

Rhode Island paid about $11 million to more than 1,000 deceased residents during fiscal year 2018 as a result of faulty software within its statewide health insurance platform, the state auditor revealed Thursday. The audit also shows the state’s Executive Office of Health and Human Services is struggling to retrieve more than $60 million in double payments dispersed to nursing homes while the computer system could not process patient applications.

The mispayments were a result of several deficiencies found in the system, called RIBridges, or sometimes referred to by its project name, the state’s United Health Infrastructure Project, or UHIP. The audit shows that the platform’s eligibility controls — the service that determines which residents can receive Medicaid — did not meet state standards. A comparison of the state’s benefit-eligibility records and independent death records performed by auditor Dennis Hoyle found 10,881 dead people were still considered “eligible” for Medicaid.

“All RIBridges designed eligibility components were not fully functional in fiscal 2018 which compromised the effectiveness of the controls over the Medicaid eligibility determination process,” the audit states.

The state says it’s recouped $6.6 million of the $11 million paid out to deceased residents.

Medicaid is a public assistance program funded by both state and federal taxes, available to people of all ages meeting qualifications loosely based on the federal poverty level.

Nursing homes also received an additional $60.8 million in double payments as part of advances the state is required to disperse when there are delays in processing Medicaid eligibility.

Lawmakers appear unclear, however, on whether nursing homes are required to return the payments. “Don’t these nursing homes have any responsibility for paying us back?” asked state Rep. Patricia Serpa, the Providence Journal reported.

Rhode Island Medicaid Director Patrick Tigue told lawmakers, “There’s been not so much a dispute, but simply that there has not been a response [from the nursing homes].”

As the state attempts to track down the wayward funds, the audit shows that records of the payments were kept in an Excel spreadsheet and by placing journal entries into the state’s accounting system.

“The level of manual processes employed in the recording of these transactions is characteristic of these types of payments,” the audit states.

UHIP was launched in September 2016 and has now cost the state nearly $650 million, more than $150 million over its original budget. It was originally intended to facilitate the state’s health insurance exchange under new requirements put forth by Obamacare in 2010, and has since expanded to include additional social services such as food stamps.

The state initially contracted Deloitte to build the system, and Gov. Gina Raimondo renewed the contract in recent weeks, extending the agreement until June 2021.

The platform has seen improvement since the end of fiscal year 2018, according to Courtney Hawkins, director of the state’s human services department.

“System defects have dropped by 70 percent in the last year, 98 percent if Medicaid renewals are being generated without system problems,” Hawkins said on Thursday. “And as the auditor general mentioned we’ve achieved SNAP timeliness rates of about 90 percent for 10 straight months.”