Survey says Idaho’s Medicaid claims system improved

A new report from the Idaho Legislature’s watchdog shows that the state’s Medicaid claims-processing system, which had a host of problems when it came online in mid-2010, has continued to improve. The Medicaid Management Information System had fewer than 5,000 pending claims in mid-August, down from a peak of nearly 95,000 pending claims in June 2011.

Molina Medicaid Solutions, a subsidiary of Molina Healthcare Inc., runs the MMIS system, which processes Medicaid claims from hospitals and medical providers in the state. Molina paid an average of 148,000 claims per week in the first eight months of the year for Medicaid, which serves more than 230,000 Idahoans.

The report from the Office of Performance Evaluations released Nov. 14 included a survey of 1,317 providers, with 25 percent saying they’re unsatisfied with the processing program. That’s an improvement from a similar survey last year, when 33 percent of providers were unsatisfied with the system.

The top reason for discontent with the system, however, is something that neither Molina nor the Idaho Department of Health and Welfare can control. Health and Welfare oversees the state’s Medicaid program. More than 25 percent of respondents said the most pressing issues are the reimbursement rates and service limits. Both are controlled by lawmakers. Other pressing issues were the accuracy of claims processing and communication with Molina.

“Over 50 percent of the reasons why they’re unhappy have nothing to do with Molina and the system,” said Del Bell, executive account manager of the Idaho system for Molina. He said the company will work on trying to communicate more effectively with providers.

Bell said Molina has made many changes to smooth out the processing system, including hiring more workers than initially expected.

“It’s a combination of the additional staff that we continue to maintain and automating additional items,” Bell said. Molina has 143 people working on the Idaho project, 125 of them in Boise, which is 25 percent more than planned.

Bell said the system is now finalizing 95 percent of claims within seven days, far surpassing the contractual requirement of finalizing 90 percent of claims within 30 days.

The survey found that medical providers who submit large numbers of claims, including hospitals, were more likely to be dissatisfied with Molina. The Idaho Hospital Association had no comment on the report.

The report also said Molina has recovered all but $1.5 million of $117 million in interim payments that DHW gave out in the summer of 2010 to assist providers that had trouble getting their claims processed.

While the Molina-run system appears to have improved, the company is taking legal action over how the system was created. Molina launched its MMIS system in June of 2010. The California-based company bought the Health Information Management division of Unisys Co., which originally won the bid to develop the claims system. Molina sued Unisys in August, alleging breach of contract and fraud in its purchase of the HIM division, which cost $131 million. In a Nov. 11 amended complaint, Molina alleges that defects in the MMIS cost the company more than $30 million.

A Molina spokeswoman said the company would not comment on pending litigation.

Molina also upgraded its system in March to comply with federal regulations. The company also moved its hardware from a Unisys data center in Salt Lake City to a data center in Albuquerque. That move took the system offline for four days.

The Molina MMIS system was certified by the federal Centers for Medicare and Medicaid Services in July, which means the federal government will pay for 75 percent of the project. That will save the state $450,000 a month, retroactive to when the project launched in June 2010.