Scrutiny falls on Maine DHHS as ineligible residents receive Medicaid

AUGUSTA — State officials said it will take at least a month to determine the fiscal impact of a computer glitch that allowed 19,000 ineligible Mainers to receive Medicaid benefits that may be reclaimed by the federal government.

In the interim, partisan interests are angling to assign blame to a problem that may have played a role in creating the recently-filled budget gap at the Department of Health Human Services. 

Democrats said that the LePage administration's decision to withhold information about the inappropriate payments means lawmakers effectively removed health care services for 14,000 Mainers with a recently-enacted budget built on inaccurate data. Republicans, meanwhile, pointed at an inefficient and error-prone payment system that last year was wrongfully denying Medicaid benefits and is now apparently wrongfully doling out benefits to ineligible Mainers. 

The source of the problem may be more complicated than the rhetoric. 

Nonetheless, the scrutiny has fallen squarely on DHHS Commissioner Mary Mayhew. Mayhew's staff had been aware of the problem, but did not inform lawmakers until this week.

Mayhew, said the payment issue was first brought to her attention in late January.

At the time the supplemental DHHS budget was still being parsed in the Legislature's Appropriations Committee. That Mayhew or staff didn't notify lawmakers in January rankled Democrats, who say they've lost confidence in the agency to produce reliable data on which to build a budget.

Mayhew said Wednesday that the breadth of the problem was not made complete until recently. 

"It came to me at the end of January, but we did not have a full understanding of the problem," she said. "At that time, I believed it was imperative that a full analysis occur to determine the exact number of cases we were dealing with."

That analysis was brought to the attention Gov. Paul LePage this week. The governor on Tuesday then informed legislative leaders.

Since then Democrats have questioned why Mayhew didn't make lawmakers aware of the problem sooner.

Rep. Peggy Rotundo, D-Lewiston, a member of the Legislature's budget-writing committee stopped short of blaming Mayhew. However, she said, identifying the problem may have allowed lawmakers to make better decisions during the budget process. She added that she was struck by the "incompetency" at DHHS and that the issue had "shaken our confidence in the ability of DHHS to be able to produce any figures for us."

"There were people in DHHS that knew that there were problems that could be creating the shortfall and they never communicated that to Appropriations," Rotundo said.

Mayhew acknowledged Wednesday that DHHS program directors had been aware of a glitch in which the state's Medicaid eligibility system wasn't communicating with its payment system. However, she said, the directors had raised "more questions than answers."

The extent to which DHHS staff knew about the problem is unclear. However, issues with payments going to ineligible Medicaid recipients had been identified by state auditors beginning last summer.

State Auditor Neria Douglass said Wednesday that the Medicaid system undergoes an audit every year. Currently the audit is reviewing system billings and payments from July 1, 2010, to June 31, 2011. 

Douglass said the full audit isn't due until the end of the month, at which time the commissioner, Mayhew, receives a full report. However, she said, as auditors encounter errors — such as benefits to ineligible recipients — members of her team inform the appropriate program directors at DHHS. 

Douglass said that she first began hearing from her staff about potential wrongful Medicaid payments last summer. 

According to Mayhew, the program managers who would have been notified of the problem were the director of MaineCare Services, the MaineCare finance director and the director for the Office of Family Independence.

The directors are political appointments by the governor. Gov. Paul LePage, in an effort to implement his new policy initiatives, last year jettisoned a host of program directors from DHHS, including all three directors from the aforementioned offices. 

Two of the replacement directors were new to the agency. A third was promoted from within DHHS.

Mayhew expressed frustration Wednesday that she was not made aware of the problem sooner. She promised that there would be accountability within the department, but she took sole responsibility for the mishap.

Mayhew also stressed that the computer system that created the problem was antiquated and notoriously unreliable. 

The state in 2010 upgraded its eligibility system. It was recently certified by the federal government. However, its payment system is more than 10 years old. Mayhew said that eligibility system was not communicating with the payment system. 

The result, she said, was that 19,000 of the state's Medicaid, or MaineCare, recipients continued to receive benefits even though the new system had determined they were ineligible. 

In each case, Mayhew said, ineligible recipients received a letter informing them that they could no longer access health benefits. But at the same time, the payment system was loading their MaineCare cards with benefits that could be used at hospitals. 

Over the next four weeks DHHS will try to determine how many ineligible individuals continued to access taxpayer-funded health care coverage. If most heeded the eligibility letters and tossed their MaineCare cards, the fiscal impact could be small. If they ignored the notices and received benefits, the impact could be much more significant. 

Lawmakers recently approved a $120 million emergency budget bill for Medicaid for the current fiscal year. The Legislature was supposed to begin addressing another funding gap for fiscal year 2013. However, work on that budget will likely get delayed until Mayhew presents her fiscal analysis of the ineligible Medicaid recipients. 

Removing the 19,000 ineligible recipients is likely to reduce the 2013 funding gap. 

The Legislature is scheduled to adjourn in early April. 

House Speaker Rep. Robert Nutting, R-Oakland, said that it was his intention to meet the adjournment date regardless of the DHHS problem. He said that if the issue wasn't addressed before the end of session, the governor could call the Legislature back in later this spring. 

Nutting also dismissed claims from Democrats that the administration was to blame for the faulty data that was used to construct the recent DHHS budget. He described as "bogus, political" Rotundo's assertion about Democrats had attempted to get accurate information from DHHS but were spurned by the administration. 

"The suggestion that the Democrats may have been suspicious of the numbers because this was happening is wrong," Nutting said. "They didn’t know this was happening. They could not have known what they did not know."

He added, "If the numbers are bad now they were bad when the previous governor (Baldacci) was here and did nothing about it."

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The fact of the matter is

The fact of the matter is that the legislature was asked to cover a budget shortfall with incomplete information that was known to Ms. Mayhew. They were asked to take away from eligible people because DHHS didn't have the money to pay for the services. Now many people are going to be without health coverage because Ms. Mayhew didn't open her mouth and reveal all the facts prior to a vote by the legislature. How is what she did any different then what has come to light in other departments? She is accountable and should be removed from the position. And since she knew at the end of January, why does she need even more time to figure out exactly how much this cost the state. That should already be a known amount. And if auditors started uncovering it last summer then shame, shame on Ms. Mayhew and the Governor as he should be supervising his commissioner since he wants to have his hand in everything and be in control of all agencies. What a disappointment that we all should have expected from this administration.

Mike Lachance's picture

What we have is an

What we have is an administration that is doing what it promised to do. Reel in spending. No other Administration in the last 2 decades has even attempted to seriously tackle this problem. Its a bumpy road but its the raod we must stay on. LePage is doing what he was elected to do. He doesnt want to control everything, he simply wants every department to act responsibly and fix their budget shortfalls. Mahieu stalled.

Tina, as with Claire, i totally agree with your post right up until the venomous anti-LePage stuff is thrown in for measure.



The people who knew and said nothing should be fired and we should start with the governor and Ms. Maheu who were in such a fury to throw people off the MaineCare rolls that they were full of accusations when legislators pointed out to them that their figures were bogus last year. In fact I remember that this issue was brought to light when Baldacci was still governor that much of the money owed was actually due to computer problems and that Maine was being billed for money it did not owe. DHHS was trying to sort it out then but a new administration came in with an all fired agenda to pay the hospitals what they were owed and they fired anyone who knew what was going on or contradicted any of their pre-conceived notions. In spite of Ms Maheu's assertions,this should not have come as a surprise.

Mike Lachance's picture

Suuuure... Baldacci is not

Suuuure... Baldacci is not culpable for knowing... but LePage IS because he actually got the ball rolling and began the process of fixing DHHS???

Ya... fire LePage. Claire, I agree with your post with the exception of the blood-thirsty anti-LePage stuff. This was no "computer error" and Mahieu admits that numerous people in DHHS knew completely that this was going on for years; but somehow SHE didnt know? All those folks within DHHS should be let go and Mahieu may be one of them.

But if Mahieu didnt know then we can only assume Baldacci didnt know and LePage didnt know... or maybe Baldacci DID know and LePage DID know, but LePage is the one who actually is DOING something about it?

Shoot the messenger, huh?

 's picture

What fix

What action by LePage or his administration brought this problem to light. NONE. The problem came to light in a routine audit done more than a year ago. This was not going on for years. A new computer system was brought in in 2010 and it was not correctly integrated with the old system so it did not remove newly ineligible people.
Instead of doing something about the known problem, LePage simple used the incorrect numbers to force more needy people off of Medicare.


Computer problems

I recall that during the last year of the Baldacci administration there was mention that a large amount of debt in the DHHS budget was actually computer error and that they were withholding payment to the hospitals until they could figure out exactly what the state really owed. I recall the article saying that MaineCare was being billed for things they didn't cover. I also recall that in the last round of budget talks it was mentioned that a part of the debt was carried over from 2010. I'm not sure if the current computer glitch is the same computer glitch as the one mentioned before but I thought it strange that there would be two instances of this in so short a time and I recall being surprised that the hospitals were paid at the beginning of the Lepage administration with no mention of the overbilling issue.

FRANK EARLEY's picture

Just a clarification

Parity is what is needed for two computers to communicate with each other

 's picture


That doesn't begin to discuss the issues of inter-application communication.

FRANK EARLEY's picture

who cares

Does that make any difference, evidently it didn't.

FRANK EARLEY's picture

Oh what a problem

Oh what a problem we have with clarity
When we use old computers with no paraty

 's picture


But your comment doesn't add anything. Parity was an issue 40 years ago and even then in a limited context.

MICHAEL FOX's picture

Fire them

Those ones that knew and didn't say anything should be held accountable. They have no need to serve the State if they will overlook even a simple glitch. There are others in the unemployment line that will do just as well of a job, if not better.

JOHN PAINTER's picture

This type of problem within

This type of problem within MaineCare is not new, and not caused by any one Party, rather it is a systems problem caused by regular changes in leadership and people with institutional knowledge of how to manage large systems.

Unfortunately this is coming to broad public light at a very inopportune time. Maine is currently under tight deadline from the Center for Medicare and Medicaid Services (CMS) 90 days starting 12/23/11, of providing to them an approved plan of correction for it's PNMI bundled rates. The correction must entail provider agencies documenting and maintaining on site certain staff credentials, specific hours of work, etc to assure services are being provided by properly credentialed staff. Which to date it has not. No agency I have heard of has been informed of changes in its budget development, staffing patterns, personnel records, etc which would be required to establish compliance with an approved plan.

The letter from December 23 of last year

by Richard McGreal regional chief for CMS, gave the state 90 days to get it's rules amended or rewritten - and approved by CMS for how the Department will address it's PNMI (and other services) bundled rate issue, or face a "formal compliance process".

A formal compliance process would indicate a very specific plan of correction and likely suspension of all federal payments.

I do not believe this is a time to point fingers, rather it is a serious juncture for the states MaineCare program and as many who can help Maine overcome this challenge should for the sake of keeping the most vulnerable in our society safe.


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