Rhode Island Medicaid Faces Scrutiny Over $38.4 Million in Out-of-State Payments

Rhode Island’s Medicaid program, known as RI Medicaid, has come under scrutiny following revelations that it disbursed an estimated $38.4 million to managed care organizations over a two-year period for healthcare coverage of members residing in other states. Approximately $16.5 million, or 43% of these payments, were funded by Rhode Island’s general revenues.

This disclosure stems from a recently concluded performance audit titled “Medicaid Capitation Paid for Members Residing in Other States,” conducted by the Auditor General, David A. Bergantino. The audit findings, released today by the Joint Committee on Legislative Services, shed light on discrepancies in residency requirements for Medicaid eligibility.

The audit, which involved collaboration with the U.S. Department of Health and Human Services’ Office of Inspector General, aimed to assess RI Medicaid’s adherence to both state and federal regulations regarding member residency.

According to the report, the substantial payments made for members no longer residing in Rhode Island underscored deficiencies in internal controls over eligibility verification. Such lapses, the report noted, jeopardize the efficient allocation of funds in a program that serves one-third of the state’s population.

Specifically, the audit revealed instances where monthly capitation payments were extended for periods of two to three years for individuals who had relocated to another state or territory. To address these concerns, the report issued three recommendations aimed at enhancing internal controls and ensuring compliance with federal regulations regarding member residency.

The Auditor General emphasized the importance of bolstering controls over Medicaid member residency to safeguard against the misallocation of funds and uphold program integrity. The findings underscore the critical need for RI Medicaid to implement measures that accurately identify members who no longer meet residency criteria and promptly terminate their eligibility.

This performance audit, conducted in accordance with Government Auditing Standards, provides management with actionable insights and recommendations for corrective actions. The report includes management’s response outlining planned measures to address the identified deficiencies and enhance program oversight.

In light of these findings, stakeholders anticipate heightened scrutiny and efforts to strengthen controls within Rhode Island’s Medicaid program to prevent the allocation of resources to ineligible members and ensure the program’s long-term financial sustainability.

The full report and audit summary can be found at:

Audit Report – Medicaid Capitation Paid for Members Residing in Other States

Audit Summary – Medicaid Capitation Performance Audit Summary




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