N.J. made incorrect Medicaid EHR incentive payments

The New Jersey (N.J) Department of Human Services made incorrect Medicaid EHR incentive payments to fifteen hospitals, in accordance to an audit by the Department of Health and Human Services’ Office of Inspector General.

The net or average rate of the erroneous payments by New Jersey totaled $2.5 million, auditors told. 10 hospitals were overpaid $2.4 million, while 5 hospitals were underpaid $137,000, which resulted in a net overpayment of almost $2.3 million. The state agency didn’t always pay EHR incentive program payments in accordance with the federal and state needs, summarizes the report.

Furthermore, the OIG discovered that New Jersey made incorrect Medicaid EHR incentive payments to 2 extra hospitals. Although, auditors confirmed that the state agency adjusted these payments after their audit time period. Moreover, New Jersey didn’t report 1 professional incentive payment to the CMS National Level Repository (NLR), a registration and verification network that consists of data on contributors participating in the Medicaid and Medicare EHR incentive programs.

“The incorrect Medicaid EHR incentive payment errors happened because the state agency’s program integrity contractor failed to recognize few mistakes and inconsistently applied this latest program’s complex needs,” claims the OIG report. “The reporting error happened because of a technical error.”

The report points out that the Government Accountability Office has recognized faulty payments as the primary risk to the EHR incentive programs.

“These programs might be at higher threat of improper payments in comparison to other programs because they’re latest and have complex needs,” assert auditors.

OIG suggested that New Jersey take the following corrective measures:

• Refund to the federal government nearly $2.3 million in net overpayments made to the fifteen hospitals.

• Adjust the fifteen hospitals’ rest over incentive payments to account for the faulty calculations (hoped to result in future cost savings of $514,107).


• Work with CMS to make sure that the 1 unreported professional incentive payment is reported to the NLR.

• Consider the calculations for other hospitals in the state that weren’t among the 33 that auditors analyzed, to evaluate whether payment adjustments are required and refund to the federal government any overpayments recognized.