Lawmakers grill Medicaid officials

Legislators demand answers about botched launch of computer system

Lawmakers demanded answers Tuesday from state Medicaid officials over the botched launch of a new computer system that has failed to pay hundreds of doctors, therapists and other health professionals for care they’ve already provided.

The system, which went live March 1, has not paid an estimated $53 million in claims made by clinics, doctor’s offices, hospitals and therapists for the disabled who care for needy and disabled Coloradans. After nearly four months, the system is paying just 60 percent of claims, the rest denied or suspended because of system glitches and submission errors.

“Why didn’t we see this coming?” asked Kevin Lundberg R-Berthoud. “It’s not quite criminal but it’s pretty close if you start throwing doctors and clinics out of business. Doctors from my district have called me in desperation. It’s deeply concerning to me that we think we can do this to our medical establishment.”

Lundberg and others on the legislature’s Joint Budget Committee said they have received numerous calls from constituents across the state, some warning they had borrowed as much as they could and were about to go out of business because of unpaid claims. They’ve spent hours on hold with the system’s call center.

“I cannot tell you how frustrating it is to talk to constituent after constituent after constituent after constituent and always have to shrug my shoulders at the end and say, ‘This is how government runs,'” Lundberg said, comparing the new Medicaid payment system to other problematic government computer systems, including the Colorado Benefits Management System, CBMS, and the more recent state health-care exchange.

The state Medicaid department, part of the Colorado Department of Health Care Policy and Financing, launched the new software system run by contractor DXC Technology, formerly Hewlett Packard Enterprise, after warning healthcare providers 18 months ahead of time. Still, for several weeks after the system launched, wait times at a DXC call center reached up to three and a half hours as providers called for help with rejections. The computer company since has hired 60 additional people and reduced wait times to less than 15 minutes.

Claims have been rejected for various coding errors, often related to “validation” of the clinics, their addresses or patients’ Medicaid status. In the first three weeks, less than half of claims were paid. And for the last two months, the system has hovered at a 60percent pay rate.

Since its launch, the system has paid $2.3 billion in claims, and the Medicaid department has paid $16.5 million in emergency payments to health care providers while their billing issues are resolved. “Money is going out the door appropriately,” said Health Care Policy and Financing spokesman Marc Williams.

State officials have said the issues are operator error and that they warned providers through numerous letters, emails and webinars to get trained and put their documents in order before the system went live.

But at the budget hearing Tuesday, state Health Care Policy and Financing health information office director Chris Underwood acknowledged the state should have had a call center dedicated to helping providers navigate the new system.