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California Improperly Claimed at Least $23 Million of $260 Million in Total Medicaid Reimbursement for Opioid Treatment Program Services

Why OIG Did This Audit

The United States currently faces a nationwide public health emergency due to the opioid crisis. Opioid treatment programs (OTPs) provide medication coupled with counseling services (referred to in this report as "OTP services") for people diagnosed with an opioid use disorder. This audit is part of OIG's oversight of the integrity and proper stewardship of Federal funds used to combat the opioid crisis. Based on our prior audit of a selected OTP in California, we identified that there was a risk of improper Medicaid reimbursement for OTP services. Therefore, we performed this statewide audit of OTP services in California for calendar years 2018 and 2019.

Our objective was to determine whether California claimed Medicaid reimbursement for OTP services that met Federal and State requirements.

How OIG Did This Audit

Our audit covered Medicaid claims for OTP services provided from January 2018 through December 2019 (audit period), with Medicaid reimbursement totaling $371.6 million ($259.8 million Federal share).

We reviewed a stratified random sample of 130 beneficiary-months to determine compliance with Federal and State requirements. A beneficiary-month (which we refer to as a "sample item") included all claims for OTP services provided to a beneficiary in a month.

What OIG Found

California claimed Medicaid reimbursement for some OTP services that did not meet Federal and State requirements. Of the 130 sample items, 88 had services that were all allowable, but 42 had services that were unallowable.

On the basis of our sample results, we estimated that California claimed at least $23.1 million in unallowable Federal Medicaid reimbursement for OTP services during our audit period. In addition, we identified deficiencies in three areas that that did not result in unallowable services but could impact the quality of care provided to beneficiaries receiving OTP services.

What OIG Recommends and California Comments

We recommend that California refund $23.1 million to the Federal Government and take specific actions to address the deficiencies that we identified. In addition, we recommend that California take actions to ensure that OTPs comply with Federal and State requirements for providing and claiming reimbursement for OTP services. (The full text of our recommendations is shown in the report.)

California agreed with all of our recommendations and provided information on actions that it had taken or planned to take to address our recommendations, including reviewing and monitoring corrective action plans and conducting additional postservice postpayment reviews of OTPs.

Filed under: Centers for Medicare and Medicaid Services