Department of Health

Managed Care Rate Setting and Payment Practices (Follow-Up Review)

In our prior audit report 95-S-135, we examined the procedures used by the Department of Health to set the rates paid to managed care providers in New York's Medicaid program. We found that 96 percent of the rates were put into effect an average of nine months after their effective dates, and incorrect information was used in setting some rates. In addition, certain automated controls generally used in processing claims from Medicaid providers were not always used to process claims from managed care providers. We estimated that, if these controls were used for all managed care providers, at least $5 million a year in overpayments could be prevented. We recommended a number of improvements in the procedures used to set rates for Medicaid managed care providers. In our follow-up review, we found that good progress has been made in implementing the recommendations contained in our prior audit report.

For a complete copy of Report 98-F-1 click here.