Medicaid fraud audits cost more than is recovered, CMS admits

A recent Government Accountability Office (GAO) report indicates the auditing fees since 2008 totaled $102 million, while only $20 million in Medicaid overpayments were recovered. In a Bloomberg article, Peter Budetti, CMS director of program integrity, stated, “The results were extremely disappointing, way below what the expectations had been.”

Since 2008, 1,550 Medicaid audits (more than two-thirds) did not discover overpayments. According to the GAO, only 4 percent of the audits identified possible overpayments of $7.4 million, while the remaining audits are ongoing.

GAO considers MSIS data to be ineffective because it misses information that is key to indentifying potential fraud, such as provider names.

The CMS Medical Integrity Group is in the process of redesigning the National Medicaid Audit Program.