|Financial Audit Division Report 14-22||Released November 12, 2014|
In fiscal year 2014, the state spent approximately $9.6 billion ($4.4 billion of state money and $5.2 billion of federal money) to pay for benefits provided under the state’s public health care programs. The programs—Medical Assistance (Minnesota’s Medicaid program); MinnesotaCare; and the Children’s Health Insurance Program—are available to residents with low incomes.1
The Department of Human Services (DHS) is responsible for ensuring that people who receive benefits through the state’s public health care programs meet federal and state eligibility requirements. For more than 10 years, the Office of the Legislative Auditor (OLA) has raised concerns about DHS’s ability to ensure that its eligibility decisions are correct.
Minnesota created a state-based health insurance exchange (MNsure) under the federal health care law, to help the state better manage its public health programs in two ways: (1) provide people with a convenient way to apply for benefits online, and (2) allow DHS to electronically determine who was eligible for coverage. MNsure began processing new applications for public health insurance programs on October 1, 2013. Through June 2014, the state paid $376 million of benefits for people MNsure enrolled in the state’s public health care programs.
The objective of this audit was to determine the effectiveness of DHS’s oversight of MNsure’s eligibility determinations to ensure people were eligible for the benefits they received and in compliance with federal and state legal requirements.
The Department of Human Services did not ensure that Medical Assistance, MinnesotaCare, and Children’s Health Insurance Program recipients who enrolled through MNsure were eligible for the benefits they received.
The department did not ensure that data accurately and securely transferred from MNsure into the state’s medical payment system.
The department had many instances where it did not comply with the federal and state legal requirements related to recipients’ eligibility for Medical Assistance, MinnesotaCare, and the Children’s Health Insurance Program. It also charged incorrect MinnesotaCare premium rates.
1 Medical Assistance (Minnesota’s Medicaid Program) and the Children’s Health Insurance Program provide low cost or free health coverage to low income residents. MinnesotaCare is available to low income Minnesotans who earn too much to qualify for Medical Assistance.
2 DHS’s medical payment system, the Medicaid Management Information System (MMIS), is a mechanized claims processing and information retrieval system required by the federal government.