This report is the first installment of the ongoing Full Performance Evaluation of the State Medicaid Program within the Department of Health and Human Resources.

ISSUE AREA: A projected $63,275 of $1.3 billion service dollars was paid to providers for invoices in which a recipient's death preceded the invoiced service date.

This performance evaluation found that a projected $63,275 of greater than $1.273 billion service dollars was paid for Medicaid goods and services for deceased recipients. The Legislative Auditor's sample of West Virginia deaths which found that 7.8 percent of Medicaid recipients who died in 1995, or approximately 315 deceased persons, were provided goods and services after death. The postmortem payments identified in this study occurred because of the absence of a management control involving cross matching information from the DHHR's Office of Vital Statistics with Medicaid records.

These 1995 deaths predate managed care. The implications of this finding could be very costly in the future, given the greater proportion of health care costs that will be incurred prior to treatment. In one case identified in this study, an individual's eligibility status was maintained for 21 months after her death. If she had been enrolled in a managed care plan, the State would have paid an estimated $2,100 in premiums to an HMO to insure just one deceased recipient.

The only foolproof management control for preventing payments to providers for goods and services charged to deceased recipients is to interface or regularly cross match death records from the Office of Vital Statistics, which is also within the DHHR, with Medicaid eligibility and consumption records and thus is recommended. Because death statistics are collected and entered by the DHHR's Office of Vital Statistics as a matter of law, maintaining this control should be inexpensive as sharing data extracts or interfaces the two systems.

Federal regulations require the DHHR to recover funds improperly paid resulting from overpayments, false claims, and/or misrepresentation or concealment of facts related to a provider's qualifications or costs as filed with the Bureau for Medical Services.