Feds Want New York to Repay $20M for Obamacare Exchange

New York may have misallocated nearly $19.6 million in federal grant money for its Obamacare exchange.

That was a finding of the Department of Health and Human Services’s Office of Inspector General, which said the state should refund that amount, plus more than $800,000 in unallowable fees paid to the state’s exchange contractor, Maximus Inc.

The New York State Department of Health (NYSDOH), which operates the New York State of Health exchange, “strongly” disagreed with the OIG findings. The agency “followed all federal rules and guidance,” and its allocation was approved by the HHS’s Centers for Medicare & Medicaid Services, a NYSDOH spokeswoman told me.

New York’s problems stemmed from the way it allocated costs between its exchange, which was set up in 2014, and Medicaid enrollees, Chris Sloan of health-care policy consulting firm Avalere Health told me. The state's Medicaid agency should have handled more of the people who applied for coverage through the state's exchange, he said.

But “people were moving at the speed of light to set these things up,” Trish Riley, executive director of the National Academy for State Health Policy, told me. “They were thinking they understood Medicaid allocation when they didn't.”

The framers of the ACA originally thought all states would create their own exchanges, but technical difficulties, high costs, and controversy over the 2010 law contributed to only 12 of the exchanges currently run by states.

Read my full article here.

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