OIG: Providers banned from Medicaid still received $7.4M in payments

Almost 300 providers terminated from Medicaid programs for fraud, misuse, or abuse in 2011 continued to participate in other states' programs, receiving millions of dollars in reimbursements, according to a recent report from the HHS Office of the Inspector General.

Beginning in 2011, the Affordable Care Act required all states ban providers from their Medicaid programs if they were already banned in another state for cause.

The OIG compared 2011 state-submitted rosters of providers terminated for cause to 2014 rosters and reimbursement data. After examining records of 2,539 providers, the OIG found 12 percent, or 295 providers, terminated for cause in 2011 were still participating in other Medicaid programs in 2012. More than half of those terminated — 175 providers — continued participating in other states' Medicaid programs for more than two years, until January 2014, according to the report.

Of the 295 providers who continued to participate in Medicaid despite termination, 94 received payments that totaled $7.4 million.

The OIG identified the following challenges states face in ensuring banned providers do not continue participating in other Medicaid programs.

  • No comprehensive data of all terminations exists.
  • In the available data, it is difficult to distinguish terminations for cause from other administrative terminations.
  • States cannot terminate providers in Medicaid managed care who are not enrolled in the state Medicaid program.
  • The active status of a provider's professional license in each state caused misunderstandings that the licensing board decision might trump the Medicaid termination. Termination is not contingent on the status of a provider's license, according to the report.


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