GAO: CMS Doesn't Know if It's Receiving Accurate Medicaid Data

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The agency needs to better guide states to ensure the nationwide data is reliable, the congressional watchdog said.

The Centers for Medicare and Medicaid haven’t given states enough information on how to check the accuracy of the data they collect on Medicaid recipients, according to a congressional watchdog.

Without that guidance in place, the government has no way to know whether the nationwide data it receives on the Medicaid program is reliable, the Government Accountability Office said in a report published Monday.

The report highlighted a number of issues that could lead to unreliable Medicaid data. Information often flows through multiple entities before it reaches the state government, so it could get corrupted or modified at different steps in the process. State officials also told GAO legacy IT systems could incorrectly format or autofill data fields, leading to inaccuracies.

Because “encounter data” is used partly to reimburse medical groups for their services, inaccurate information could result in misspent taxpayer dollars.

To reduce those risks, states are required to independently audit the so-called “encounter data” they collect on Medicaid recipients before submitting it to the federal government. However, CMS hasn’t yet told states what that audit should entail, according to the report.

While each of the eight states auditors examined had some system in place to check the validity of their data, the practices weren’t consistent across the board. As such, CMS can’t definitively know whether the data it receives is reliable or what parts could be inaccurate, according to GAO.

Furthermore, states are required to report on their efforts to ensure data reliability every year, but CMS hasn’t said what information those assessments should include, auditors found. The agency hasn’t even told states when the first report is due, they added.

“Until CMS disseminates information on how states should implement this assessment ... the agency will continue to lack the knowledge it needs to monitor how states validate their encounter data and address data weaknesses,” they said.

Additionally, the agency has the right to defer or cut off federal funds to states that don’t meet basic standards for data quality, though it’s unclear whether that threshold is clearly defined. Auditors found CMS “has not determined or informed states” under what circumstances it would withhold funds.

“Until CMS provides this information to states, the effectiveness of this as a potential enforcement tool is diminished,” they said, “thus potentially hampering its efforts to address concerns about the reliability of Medicaid encounter data.”