RALEIGH — A new North Carolina Medicaid billing system continues to falls short on addressing defects months after coming online in the summer and on completing government-mandated changes on time, according to a state performance audit released Monday.
State Auditor Beth Wood’s office released a follow-up to an audit report in May that found NCTracks hadn’t been fully tested in advance of the July 1 start. The new report, which examined roughly the first four months of operations, said NCTracks has encountered more than 3,200 program defects and has an “inadequate framework” to address the defects.
The audit is another poor mark for NCTracks, which replaced a system that was first began in the 1970s. An outside vendor is getting paid $484 million to build and operate the system, which has received complaints from doctors’ offices and hospitals about being denied claims payments and receiving little assistance from the vendor-run help desk.
Leaders of the Department of Health and Human Services, which manages Medicaid, and Computer Sciences Corp. have acknowledged problems at legislative oversight committee meetings this fall. But they said many early claims and call center troubles have been addressed. The audit was released the day before the General Assembly panel received its third update.
As of early November, about one-third of the defects focused upon the NCTracks web portal, which tens of thousands of medical providers are expected to use, the audit said. Problems have included functions to check patient eligibility for services, the status of claims and updating provider data.
In a formal response from DHHS attached to the audit, the department largely agreed with recommendations but also said the number of defects were lower on average for a similarly situated computer program in the private sector, citing data. DHHS also said it received the approval from Medicaid regulators for NCTracks to begin July 1.
“Our primary focus continues to be to make system improvements and to ensure that every provider is paid for the work they do. But if even one provider is impacted negatively, that’s one too many,” said Joe Cooper, the department’s chief information officer in a statement separate from the audit. He said more than 81 percent of identified defects had been resolved.
The North Carolina Medical Society, representing physicians, hopes the report means “definitive action will be taken now to fix NCTracks once and for all,” society CEO Bob Seligson said in a statement. NCTracks, he added, “has been hurting patients and hurting doctors throughout the state since it went live on July 1.”
DHHS has targeted response times to address defects, such as 24 hours for a “critical” system-wide failure. But the agency gave conflicting information about what a “response” means, the audit said.
The report found 12 of the agency’s 14 top system changes that are mandated by legislation or regulation weren’t in place by their target or required dates. In the attached response, DHHS said it’s working to implement all outstanding change requirements by March 1 and determine additional costs to the state.
Most of the price tag for building the project is being paid by the federal government. The state currently pays 50 percent of the system’s operational cost, but it will fall to 25 percent once the federal government certifies the system as sound.
The audit also urged the General Assembly to pass a law limiting senior-level state workers to go to work directly for a vendor they directly managed. The recommendations came after a high-level state employee on NCTracks moved to Computer Sciences Corp. Auditors found DHHS and the company followed established procedures to approve the hiring.
NCTracks is expected to pay out more than $12 billion from 88 million claims filed annually for Medicaid, the federal-state health insurance program for more than 1.7 million North Carolina residents.