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Colorado Could Owe Feds Up to $43 Million for Medicaid “Systems Error”

Aimee Sharp
Author | Shield HealthCare
03/22/17  1:19 PM PST
Colorado Medicaid

By Brian Eason for The Denver Post

A “system error” at the state Medicaid department could leave Colorado taxpayers on the hook to repay the federal government as much as $43 million, an unexpected expense that state officials are scrambling to reconcile.

he department’s computer system “erroneously categorized” some services as eligible for more federal funds than they were, according to a memo sent Wednesday to lawmakers on the Joint Budget Committee from a committee staffer.

The state Department of Health Care Policy and Financing, which oversees Medicaid government health insurance for the needy and disabled, estimated the federal payback would total anywhere from $21.8 million to $43.4 million. The department is fixing the system error for Medicaid claims beginning this month, but the problem dates back to July 2015.

“This should have been caught,” said state Sen. Kent Lambert, R-Colorado Springs, who chairs the JBC. “The fact is, it wasn’t.”

There’s deep disagreement within Gov. John Hickenlooper’s administration about what the state will ultimately owe, according to the memo.

Some state officials were described as optimistic that the federal government will forgive some or all of the debt, saying the Obama administration had historically been lenient when states made mistakes in implementing the Affordable Care Act. Others were said to be incredulous at the idea that the Trump administration would require anything less than full repayment.

The computer system wrongly calculated that thousands of people were eligible for an “enhanced” federal match that applies to those who were added to Medicaid rolls because of the Affordable Care Act.

The department blamed the Colorado Benefits Management System, the computer system that has plagued Colorado for years with security breaches and errors. A “programming update” slated for later this month will correct the system error, said Health Care Policy and Financing spokesman Marc Williams.

Read the Full Article at The Denver Post.

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