SALEM — The Oregon Health Authority may owe the federal government up to $64 million for erroneous payments it made over three years because of an error in the Cover Oregon website, according to OHA.
The failed website, which was used by state agencies but never launched to the public, miscategorized people eligible for both Medicare and Medicaid, according to Gov. Kate Brown’s office. The mistake resulted in OHA making $74 million in overpayments to Coordinated Care Organizations for patients eligible for both Medicare and Medicaid from 2014 to mid-2016. The miscategorization resulted in Oregon receiving excess federal funding for that dual-eligible population.
OHA was able to recoup $10 million of the overpayments from CCOs in 2016 but lacked a mechanism to recover the excess amounts paid out in 2014 and 2015, said Robb Cowie, an OHA spokesman.
The problem was known for some time but was not publicized until after Patrick Allen took the helm of OHA two months ago. Brown selected the former head of the Department of Consumer and Business Services to lead OHA after former Director Lynne Saxton resigned in August amid a scandal over a conspiracy to plant negative news about a Portland-area Medicaid provider.
When the new leadership took over, employees brought the miscategorization issue to the agency’s new chief financial officer, Laura Cali Robison, and identified it as “a problem to be dealt with,” Allen said.
“It was one of the echoes of one of the problems with Cover Oregon,” he said.
OHA estimates that about 40,400 Oregon Health Plan recipients were miscategorized as a result of the error. So far, the impact on OHA’s budget has been small. Overall, the state made nearly $7 billion in payments for Medicaid recipients on the Oregon Health Plan in 2016.
“It’s a very small piece of our budget, even though it ends up being big dollars,” Allen said.
Another error related to Cover Oregon and Oregon Health Plan recipients, which OHA officials are still parsing out, also may require repayment to the federal government, Allen said. It’s still unclear how much that error could cost the agency or impact Oregon Health Plan recipients, he said.
Brown publicly thanked Allen and his team “for responding quickly” to the revelations about the problems.
“It’s vital that we have a transparent, efficient and accountable health care system because the lives of so many Oregonians depend on it,” Brown said in a statement.