Hospitals across Colorado are waiting on millions of dollars in reimbursements after the state Medicaid department went live with a new technology system six months ago, the situation growing so dire that hospital officials say they are concerned they will have to start turning away needy patients.
Doctors who haven’t been paid by the state are now asking whether Colorado will pay them back for the interest they’ve incurred taking out loans to keep their practices open.
And other providers who accept Medicaid but have had claims denied — including therapists for the disabled — are asking whether the state will fine the technology vendor running the new claims system that has had a rough start.
The problems were raised again Wednesday in a meeting of the legislature’s Joint Budget Committee, a follow-up to a June meeting in which lawmakers demanded answers from the state Department of Health Care Policy and Financing, which runs the Medicaid program. Legislators were irritated that problems with the system persist, and noted numerous calls from doctors and other health professionals in their districts, including a meeting of 20 providers in Grand Junction.
“We were here three months ago,” said Sen. Kevin Lundberg, R-Berthoud. “We were assured that we were just about at the end of the rocky road.”
At first, Rep. Dave Young, D-Greeley, was hearing mainly from therapists for people with disabilities. But, he said, “this has blown out to a wide array of concerns.”
Five individual hospitals and five hospital systems were owed nearly $211 million in claims after the first four months of the new system, run by DXC Technology, according to data released Wednesday by the Colorado Hospital Association. Rural hospitals in particular are struggling with the lack of payment, said Julie Lonborg, the association’s vice president for communications.
“It’s unsustainable at this level,” she said, noting that hospitals are worried they will have to stop treating Medicaid patients in nonemergencies.
The new system, which puts the state in compliance with several state auditor recommendations, went live March 1, resulting in havoc for hundreds of providers whose claims were rejected for coding errors and “validation” issues, some as simple as addresses. 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.
The system is now paying 66 percent of claims, with long-term goal of 75 percent.
“When I got 66 percent in high school, I got a D,” said Joshua Ewing, manager of regulatory affairs for the Colorado Hospital Association, which based estimates of how much is owed to hospitals on previous payments, not on prices listed on bills.
At a call center to help with claims, agents have increased from 15 to 60 in recent months.
Medicaid officials said the new system has paid 28 million claims, totaling $4.3 billion, so far and is improving weekly. The system now has 98,000 claims in suspension waiting on human review but, in normal operations, will have 30,000 claims awaiting review within 10 business days.
The new system replaces 30-year-old technology and will help the state pay more accurately, as well as bring Colorado into federal compliance, said Susan Birch, health care policy and financing executive director.
“This transition has been incredibly complex,” she said. “We absolutely recognize and acknowledge that many have struggled.”
