The Centers for Medicare and Medicaid Services has been inconsistent in reviewing states’ Medicaid managed care rates, according to the U.S. Government Accountability Office.
The Children’s Health Insurance Program Reauthorization Act of 2009 (CHIPRA) requires the GAO to examine the extent to which states’ Medicaid managed care rates are actuarially sound.
State rates must comply with Medicaid managed care “actuarial soundness requirements” issued by CMS in 2002. CMS requires Medicaid rates to be developed in accordance with actuarial principles, appropriate for the population and services, and certified by actuaries.
A state must submit its rate-setting methodology, including a description of the data used to come up with rates, to CMS for approval.
The GAO found gaps in CMS Medicaid rate oversight in several states, including Tennessee and Nebraska.
A GAO team looked at 28 CMS files documenting rate-setting reviews completed as of Oct. 31, 2009.
CMS went without reviewing Tennessee’s Medicaid rate setting for several years, and Tennessee received about $5 billion a year in federal funds for rates that GAO determined had not been certified by an actuary, officials say.