Audit of Medicaid Capitation Payments for Deceased Beneficiaries in Florida

Florida's Agency for Health Care Administration (State agency) did not always stop making capitation payments after a beneficiary's death, despite its efforts to identify and recover any overpayments. Of the 124 capitation payments in our random sample selected from payments to beneficiaries whose dates of death (DODs) preceded the payment date, the State agency recovered 10 payments prior to the start of our audit and 1 was not recoverable. For the remaining 113 capitation payments, the State agency made overpayments totaling $192,000 ($112,000 Federal share). During the course of our audit, the State agency adjusted 34 of the 113 payments totaling $64,948. On the basis of our sample results, we estimated that the State agency made overpayments to managed care organizations (MCOs) totaling $26.2 million ($15.4 million Federal share) during our audit period. These overpayments amount to approximately 2 percent of the $1.3 billion that the State agency paid to MCOs from July 1, 2009, through November 5, 2014, on behalf of deceased Medicaid beneficiaries.

These overpayments occurred because the State agency did not (1) timely update the DODs in the Florida Medicaid Management Information System (FMMIS), and the beneficiaries' enrollments were not updated once they were identified as deceased and (2) collaborate with other State and Federal agencies to determine the inconsistency between the sources of DODs or use additional sources or alternative procedures to determine the reason its data sources were inconsistent.

We recommended that the State agency (1) identify and recover overpayments totaling $26.2 million from MCOs and refund $15.4 million (Federal share) to the Federal Government; (2) perform monthly reviews of FMMIS records to ensure that beneficiaries with DODs are removed from the Florida Statewide Medicaid Managed Care Program; (3) implement policies and procedures for identifying and correcting inaccurate death information received through its sources of death data, specifically ensuring that differences in the DODs between the FMMIS and incoming death records are quickly resolved; and (4) improve its collaborative efforts with the Social Security Administration, the Department of Children and Families, and Florida's Bureau of Vital Statistics to identify and resolve inconsistencies in recipient information such as DODs and social security numbers.

The State agency did not indicate whether it agreed or did not agree with our recommendations; nevertheless, it stated that it recovered almost $24 million of the $26 million in overpayments that we identified and described steps that it has taken or planned to take to implement our four recommendations.