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State's Medicaid billing computer system still having glitches

State House Bureau

June 18. 2014 7:59PM

CONCORD — Problems with the state’s computer system to administer the Medicaid program has one Manchester hospital seeking nearly $3 million in claims that are more than 90 days old.

The system has cost more than $117 million since the first contract was approved in 2005 for about $60 million, with the most recent amendment approved Wednesday by the Executive Council adding $6.8 million to the price tag.

District 4 Executive Councilor Chris Pappas, D-Manchester, said there continues to be operational issues with the system when 20 to 30 percent of one hospital’s claims are denied. He said Elliot Hospital has $2.7 million in claims that are more than 90 days old.

Health and Human Services Commissioner Nick Toumpas said his agency and the contractor Xerox State Healthcare LLC, continue to work through the issues, but noted significant progress has been made on one area affecting many health care providers — suspended claims.

Changes are required to an already complicated system he said, because of the state’s new Health Protection Program which is expected to add about 50,000 adults to the program and federal mandates, which are the basis for the latest contract amendment.

Toumpas told the council his team and Xerox continue to work on the priority issues, noting the company is “on the hook” for a lot of the costs.

He said there have been a number of issues with the system that he takes responsibility for, but some providers and not billing properly.

Elliot has been contacted and understands there are some things it can do now to mitigate the problem.

A significant number of suspended claims have been addressed Toumpas said, but “the issue now is we have to go claim by claim and determine ‘Is there a billing error? Is it a system issue? Or is it something that needs to be denied?’”

Pappas noted the problem has come on the last few months, and added Elliot would like to have it resolved before the end of the fiscal year June 30.

The project experienced a number of delays and costs overruns before finally going on line April 1, 2013.

The Medicaid Management Information System is designed to process the $1.4 billion in Medicaid claims each year for medical services to 140,000 recipients. About 10,000 medical providers participate in the program.

Electronic Data Systems, now owned by Hewlett-Packard, had managed the system for two decades prior to 2005, when the state put an upgrade out to bid.

Affiliated Computer Services, now owned by Xerox, won the bid coming in $10 million below EDS for the five-year contract.

Hewlett-Packard continued to process the Medicaid claims until April 1, 2013.

The federal government pays 90 percent of the system design, development and implementation, and then 75 percent of the system cost once it is operating.

Wednesday’s contract amendment will be paid with 83 percent federal funds and 17 percent state money.

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