Family and Children's Medicaid MA-3535 RECIPIENT FRAUD AND ABUSE POLICY AND PROCEDURES

IX. North carolina health choice Overpayments

A. Establishing the periods of ineligibility for North Carolina Health Choice (NCHC) is based on the same policies and guidelines that are used to establish the overpayment periods for Medicaid cases.

1. Allow time for advance notice requirements for changes that must be reported to the county, such as acquisition of comprehensive health insurance and moving out of state. The guidelines can be found in MA-3255, North Carolina Health Choice.

2. To determine when the client was notified of the major health insurance coverage it may be necessary to contact the health insurance provider, child support, the policyholder or the policyholder’s employer.

3. If it determined that the insurance information was reported to the agency, this includes child support, the overpayment cannot be collected from the recipient’s family. Agency responsible errors are not collectible and should never be entered into EPICS.

B. Calculating NCHC overpayments occurring before July 1, 2010

Unlike Medicaid, NCHC benefits are provided through the State Employees Health Plan (SEHP).

1. The Division of Medical Assistance paid a monthly premium to the SEHP for each recipient in a case regardless of whether they see a medical provider for service.

2. The monthly premiums for NC Health Choice recipients can be determined by the EIS classification codes.

3. When establishing the recipient overpayment amount for potential fraud, there is no separate evaluation for Medicaid eligibility.

4. Do not establish an overpayment for the enrollment fee on a recipient who was authorized under MIC-J but should have been authorized as MIC-K.

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(IX.B.5.)

5. The overpayment amount is based on the monthly premium amount for each month in which a recipient is ineligible for NCHC. Apply the appropriate rate per recipient found in the Family and Children’s Medicaid Income and NCHC Premium History.

NOTE: There is no recipient profile to request since the monthly fee encompasses all services received in a month.

6. To calculate the overpayment amount for an NCHC claim:

a. Multiply the appropriate monthly premium(s) by the number of ineligible months for each ineligible child.

b. Add the overpayments for all ineligible children in the household together to obtain the total NCHC overpayment. Enter this amount in EPICS as the overpayment amount. The service code for NCHC premiums is 67.

c. If the period of ineligibility includes months on or after July 1, 2010, use instructions in IX.C, below to calculate the overpayment. Add the amount of the two periods of ineligibility together to get the total NCHC overpayment.

Example: Ms. Pickles applied for NCHC for her three children on 10/01/08. She stated she received her support payments by a money order in an envelope with no return address, and provided a copy of the most recent money order. She also stated there was no Third Party Insurance coverage on the children. Her reported income was too high for MIC-N

The worker verified thru ACTS that there was no Medical Support order in place at that time. The worker reminded the client she was required to report all insurance coverage for the children within 10 days of her knowledge of the change. She also reminded her that the children would not be eligible for NCHC once coverage by a third party became available.

At her annual review on 08/22/09, Ms. Pickles reported her children’s father provided Prudential medical cards for her children on 12/24/08. When asked why she never reported it, she stated that she never used it since she had NCHC on the children. She also stated that the copayments for the insurance provided by the AP were more than that of NCHC. A DSS- 8110 (Timely Notice) was completed and mailed to the client on 08/22/09 to terminate the NCHC case effective 09/30/09.

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(IX.B.6b.)

Determine ineligibility and calculate the overpayment as follows:

Step 1: Verify the insurance is major medical. A telephone call to the insurance carrier verified each child had major medical coverage effective 12/01/08.

Step 2: Determine the period of ineligibility.

The NCHC date of application is 10/01/08. The client received the medical cards on 12/24/08. Allow 10 calendar days for the client to report the change (1/3/09). Also allow 10 working days for the timely notice to terminate the NCHC case as if the information had been reported timely (1/19/10). The case would have terminated 01/31/09. The period of ineligibility is 02/01/09 through 09/30/09, 8 months. The NCHC premium paid by SEHP for each child during the period of ineligibility was $146.84 per month.

Step 3: Determine the overpayment.

$146.84 x 8 months = $1,174.72 per child

$1,174.72 x 3 children = $3,524.16

Since the period of ineligibility did not include any months on or after July 1, 2010, the total NCHC overpayment is $3,524.16. Enter this amount in EPICS with the service code 67 for NCHC.

C. Calculating NCHC overpayments occurring on or after July 1, 2010

Effective July 1, 2010, the Division of Medical Assistance eliminated the premium payments for NCHC. Overpayments for NCHC will be based on the amount of claims paid during the period of ineligibility.

1. When establishing NCHC recipient overpayment amount for potential fraud, there is no separate evaluation for Medicaid eligibility.

2. Do not establish an overpayment for the enrollment fee on a recipient who was authorized under MIC-J but should have been authorized as MIC-K.

3. Determine the amount paid by NCHC during the period of ineligibility:

a. Request a Medicaid/NCHC Recipient profile via the DMA-7063 from DMA Quality Assurance.

NOTE: Do not combine requests for NCHC and Medicaid claims on the same DMA-7063.

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(IX.C.3.b.)

b. If the period of ineligibility includes months prior to July 1, 2010, use instructions in IX.B, to calculate the overpayment. Add the amounts of

the two periods together to get the total NCHC overpayment.

EXAMPLE:

01/02/09: Ima Lyon applies for Medicaid for her 8 year old grandson, Tommy Thumb. She states her son, Thom Thumb, left his son in her care when he took an out of state assignment. She states the only income Tommy has is from Social Security (due to his mother being deceased) in the amount of $1,015/month. She states she receives no child support.

01/20/09: Tommy Thumb approved for NCHC from 1/09-12/09.

11/30/09: Ima Lyon completed the review stating there was no change. Tommy is again approved for NCHC for 1/10-12/10

11/15/10: DMA Program Integrity received a call from Pretty Madd, ex-girlfriend of Thom Thumb. She stated she just learned his son was getting Medicaid. She stated she wanted to know how this could be since his father is in the home and working. She reported that he works for “On the Move Movers”, making $2,400/month. She knows this is true because she does the books for On the Move Movers. Additionally, he has Tommy on his health insurance. She states Thom went to live with his mother Ima Lyon and Tommy on November 25, 2009 when she kicked him out. She faxed DMA proof of the insurance and his pay. A referral was sent to the local DSS PI office.

11/19/10: An investigation was conducted and it was determined that Thom Thumb was in the home and had been at the time of Ms. Lyons’ last review. The verification obtained reflected that Mr. Thumb’s salary with “On the Move Movers” was $2,400/month since he was employed as of 10/17/09. It also showed he paid for insurance for him and Tommy. The coverage with BCBS began with 01/01/10. It was also determined that Mr. Thumb provided Ima Lyon with the insurance card and was unaware that she was receiving NC Health Choice for his son. A written summary of findings were sent to the caseworker.

12/01/10: The case worker sent a DSS 8110 to Ms. Lyon to terminate Tommy Thumb’s NCHC terminated effective 12/31/10. A referral was sent to PI.

Calculate the overpayment using the following rules:

Rule: Evaluate eligibility for all other coverage groups for each AU member.

Rule: Determine the unreported countable income during the certification period(s).

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(IX.C.3.b.)

Rule: Re-compute the budget using the actual verified unreported income received during the overpayment base period. If there are multiple certification periods, re-compute budgets for each period separately.

Tommy was eligible for NCHC from 1/09-12/09.

His father, Thom Thumb moved in with him and Ima Lyon on 11/25/2009. Ms. Lyon should have reported the change in household composition at review on 11/30/09. When Thom’s income is added together with Tommy’s SSA income, Tommy is ineligible for NCHC effective with January 2010.

The period of ineligible is from 1/10-12/10.

Rule: Determine the overpayment amount prior to July 1, 2010.

The overpayment for 1/2010-6/2010 is based on the premium paid by the State.

159.73 x 6 = $958.38

Rule: Determine the overpayment amount July 1, 2010 and after.

The overpayment for 7/2010-12/2010 is based on the actual services used. To determine this amount, a profile (DMA-7063) must be sent to DMA.

The profile is ordered and it shows that $4,596.35 in services was used during 7/2010-12/2010.

Rule: Calculate the total overpayment.

The total overpayment includes premiums (1/10-6/10) and actual NCHC claims paid (7/10-12/10). Add together the amounts of the two periods together to get the total NCHC overpayment.

$ 958.38 + $4,596.35= $5,554.73