Finding 1205101 (2025-007)

Finding Number - 2025-007 Manage Care Audits Agency Department of Health & Human Services Federal Program Medicaid Cluster ALN 93.778 Compliance Requirement Special tests Type of Finding Internal Control over Compliance Category Other Criteria Federal Medicaid managed care regulations (42 CFR Part 438.358) and PRHIA contract requirements for Managed Care Organization (MCO) oversight stipulate that findings from External Quality Review Organization (EQRO) reports should be used to monitor and improve the quality of services and that corrective actions should be implemented in a timely manner. Also, the regulations require that EQRO technical reports be made publicly available, including publication on the State’s website. Timely follow-up and public availability of these reports are essential to ensure transparency, compliance with quality standards, and adherence to State Plan requirements. Condition During our review of the EQRO’s activities for Puerto Rico Medicaid MCOs, we noted that the 2023 EQRO report issued by Mercer identified findings across all four MCOs that required corrective actions. However, management did not perform documented follow-up or monitoring to ensure these findings were addressed throughout 2024. Instead, MCOs were not reviewed for resolution of these issues until the subsequent annual EQRO review. Also, we verified that the results of these periodic audits were posted on the state’s website, as required by federal regulations. However, most recent reports were not included on website. Cause Management relied primarily on the subsequent annual EQRO review to determine whether MCOs had addressed the 2023 findings, rather than implementing ongoing monitoring procedures throughout 2024. As a result, formal internal procedures to document the monitoring of corrective actions and the timely publication of the reports on the website have not been fully established. Effect The lack of documented monitoring procedures and confirmation of public posting may result in delays in addressing identified findings and limit transparency regarding program performance. This condition may also increase the risk of noncompliance with federal Medicaid managed care regulations and applicable contractual requirements. Questioned Costs None Perspective Information During our review of the EQRO oversight process, we noted that the Program receives technical reports prepared by the External Quality Review Organization (EQRO) related to the performance and quality of services provided by the Managed Care Organizations (MCOs). These reports include findings and recommendations intended to support monitoring activities and improve the quality of services provided under the Medicaid managed care program. However, documentation supporting timely follow-up on the findings and confirmation that the reports were made publicly available on the Program’s website was not consistently maintained. Prior Year Audit Finding This is not a repeat finding. Recommendation We recommend that management establish formal procedures to document the review and follow-up of EQRO findings and recommendations, including tracking the implementation of corrective actions by the MCOs. Also, management should implement a process to ensure that all required EQRO technical reports are published on the Program’s website in a timely manner and that evidence of such publication is retained for monitoring and compliance purposes. Views of Responsible Officials and Planned Corrective Actions The PRDH’s management agrees with this finding. Please refer to the corrective action on pages 57-60.