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COMBATING WASTE, FRAUD, AND ABUSE IN 

MEDICAID’S PERSONAL CARE SERVICES PROGRAM 

HEARING 

BEFORE THE

SUBCOMMITTEE ON OVERSIGHT AND 

INVESTIGATIONS 

OF THE

COMMITTEE ON ENERGY AND 

COMMERCE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FIFTEENTH CONGRESS 

FIRST SESSION 

MAY 2, 2017 

Serial No. 115–29 

( 

Printed for the use of the Committee on Energy and Commerce 

energycommerce.house.gov 

COMMITTEE ON ENERGY AND COMMERCE 

GREG WALDEN, Oregon 

Chairman 

JOE BARTON, Texas 

Vice Chairman 

FRED UPTON, Michigan 

JOHN SHIMKUS, Illinois 

TIM MURPHY, Pennsylvania 

MICHAEL C. BURGESS, Texas 

MARSHA BLACKBURN, Tennessee 

STEVE SCALISE, Louisiana 

ROBERT E. LATTA, Ohio 

CATHY MCMORRIS RODGERS, Washington 

GREGG HARPER, Mississippi 

LEONARD LANCE, New Jersey 

BRETT GUTHRIE, Kentucky 

PETE OLSON, Texas 

DAVID B. MCKINLEY, West Virginia 

ADAM KINZINGER, Illinois 

H. MORGAN GRIFFITH, Virginia 

GUS M. BILIRAKIS, Florida 

BILL JOHNSON, Ohio 

BILLY LONG, Missouri 

LARRY BUCSHON, Indiana 

BILL FLORES, Texas 

SUSAN W. BROOKS, Indiana 

MARKWAYNE MULLIN, Oklahoma 

RICHARD HUDSON, North Carolina 

CHRIS COLLINS, New York 

KEVIN CRAMER, North Dakota 

TIM WALBERG, Michigan 

MIMI WALTERS, California 

RYAN A. COSTELLO, Pennsylvania 

EARL L. ‘‘BUDDY’’ CARTER, Georgia 

FRANK PALLONE, JR., New Jersey 

Ranking Member 

BOBBY L. RUSH, Illinois 

ANNA G. ESHOO, California 

ELIOT L. ENGEL, New York 

GENE GREEN, Texas 

DIANA DEGETTE, Colorado 

MICHAEL F. DOYLE, Pennsylvania 

JANICE D. SCHAKOWSKY, Illinois 

G.K. BUTTERFIELD, North Carolina 

DORIS O. MATSUI, California 

KATHY CASTOR, Florida 

JOHN P. SARBANES, Maryland 

JERRY MCNERNEY, California 

PETER WELCH, Vermont 

BEN RAY LUJA ́ N, New Mexico 

PAUL TONKO, New York 

YVETTE D. CLARKE, New York 

DAVID LOEBSACK, Iowa 

KURT SCHRADER, Oregon 

JOSEPH P. KENNEDY, III, Massachusetts 

TONY CA ́ RDENAS, California 

RAUL RUIZ, California 

SCOTT H. PETERS, California 

DEBBIE DINGELL, Michigan 

SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS

TIM MURPHY, Pennsylvania 

Chairman 

H. MORGAN GRIFFITH, Virginia 

Vice Chairman 

JOE BARTON, Texas 

MICHAEL C. BURGESS, Texas 

SUSAN W. BROOKS, Indiana 

CHRIS COLLINS, New York 

TIM WALBERG, Michigan 

MIMI WALTERS, California 

RYAN A. COSTELLO, Pennsylvania 

EARL L. ‘‘BUDDY’’ CARTER, Georgia 

GREG WALDEN, Oregon (ex officio) 

DIANA DEGETTE, Colorado 

Ranking Member 

JANICE D. SCHAKOWSKY, Illinois 

KATHY CASTOR, Florida 

PAUL TONKO, New York 

YVETTE D. CLARKE, New York 

RAUL RUIZ, California 

SCOTT H. PETERS, California 

FRANK PALLONE, JR., New Jersey (ex 

officio) 

(II) 

(III) 

C O N T E N T S 

Page 

Hon. Tim Murphy, a Representative in Congress from the Commonwealth 

of Pennsylvania, opening statement ................................................................... 1 

Prepared statement .......................................................................................... 3 

Hon. Diana DeGette, a Representative in Congress from the State of Colorado, opening statement ...................................................................................... 4 

Hon. Greg Walden, a Representative in Congress from the State of Oregon, 

opening statement ................................................................................................ 6 

Prepared statement .......................................................................................... 7 

Hon. Frank Pallone, Jr., a Representative in Congress from the State of 

New Jersey, opening statement .......................................................................... 9 

Prepared statement .......................................................................................... 10 

WITNESSES

Christi A. Grimm, Chief of Staff, Office of Inspector General, Department 

of Health and Human Services ........................................................................... 12 

Prepared statement .......................................................................................... 14 

Answers to submitted questions ...................................................................... 94 

Katherine M. Iritani, Director, Health Care, Government Accountability Office ......................................................................................................................... 26 

Prepared statement .......................................................................................... 28 

Answers to submitted questions ...................................................................... 99 

Tim Hill, Deputy Director, Center for Medicaid and CHIP Services, Centers 

for Medicare and Medicaid Services, Department of Health and Human 

Services ................................................................................................................. 55 

Prepared statement .......................................................................................... 57 

Answers to submitted questions ...................................................................... 103 

SUBMITTED MATERIAL

Subcommittee memorandum .................................................................................. 89 

(1) 

COMBATING WASTE, FRAUD, AND ABUSE IN 

MEDICAID’S PERSONAL CARE SERVICES 

PROGRAM 

TUESDAY, MAY 2, 2017 

HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS, 

COMMITTEE ON ENERGY AND COMMERCE, 

Washington, DC. 

The subcommittee met, pursuant to call, at 10:16 a.m., in Room 

2322, Rayburn House Office Building, Hon. Tim Murphy (chairman 

of the subcommittee) presiding. 

Members present: Representatives Murphy, Griffith, Brooks, Collins, Walberg, Walters, Costello, Carter, Walden (ex officio), 

DeGette, Schakowsky, Tonko, Clarke, Ruiz, and Pallone (ex officio). 

Staff present: Jennifer Barblan, Chief Counsel, Oversight and Investigations; Ray Baum, Staff Director; Elena Brennan, Legislative 

Clerk, Oversight and Investigations; Lamar Echols, Counsel, Oversight and Investigations; Blair Ellis, Press Secretary/Digital Coordinator; Emily Felder, Counsel, Oversight and Investigations; Jennifer Sherman, Press Secretary; Julie Babayan, Minority Counsel; 

Jeff Carroll, Minority Staff Director; Christopher Knauer, Minority 

Oversight Staff Director; Miles Lichtman, Minority Policy Analyst; 

Kevin McAloon, Minority Professional Staff Member; Jon Monger, 

Minority Counsel; Dino Papanastasiou, Minority GAO Detailee; 

and C.J. Young, Minority Press Secretary. 

OPENING STATEMENT OF HON. TIM MURPHY, A REPRESENTATIVE IN CONGRESS FROM THE COMMONWEALTH OF PENNSYLVANIA 

Mr. MURPHY. Good morning. The subcommittee convenes this 

hearing today to examine Medicaid Personal Care Services, a critical lifeline for our Nation’s most vulnerable populations. 

Medicaid is the largest provider of long-term care services for 

disabled and elderly individuals. Lately, long-term care has shifted 

from nursing homes and institutional settings to services provided 

to beneficiaries in their homes. 

Personal care services, or PCS, provides essential services to 

Medicaid beneficiaries with significant needs so that they can stay 

in their homes. As they enter this ever more vulnerable stage of 

life, most elderly persons prefer to live in familiar surroundings. 

These are not health services, but rather they assist beneficiaries 

with daily activities they can no longer do without assistance such 

2 

as meal preparation, laundry, and transportation so that they can 

continue to live in their communities. 

PCS now makes up a large component of home- and communitybased care and continues to grow rapidly. In 2015, Federal and 

State expenditures for PCS amounted to $15 billion, up from $12.7 

billion in 2011. The actual figure is probably significantly higher 

because this number only reflects fee-for-service claims, and does 

not include managed care. 

The U.S. Department of Labor projected that employment of personal and home health aides will grow by 46 percent between 2008 

and 2018, which far exceeds the average growth of 10 percent for 

all occupations. 

While the move toward home care has undoubtedly improved the 

lives of Medicaid beneficiaries by allowing them to stay at home 

and saves money for taxpayers, we cannot turn a blind eye to 

waste, fraud, and abuse in the Personal Care Services program. 

More than 29 reports by the HHS Office of Inspector General 

have uncovered systemic fraud in PCS. The OIG has uncovered 

schemes between PCS attendants and Medicaid beneficiaries to 

submit claims for services that were not provided. This type of 

fraud is difficult to detect because attendants can often be a beneficiary’s spouse, child or friend. 

Even more troubling is the abuse that HHS OIG’s investigations 

found. Stories like that of a beneficiary in my home State of Pennsylvania dying of exposure to the cold while under the care of a 

PCS attendant. This beneficiary had autism and a history of running away, but the attendant left her alone in a crowded shopping 

mall and waited an hour to call authorities. 

In Maryland, a disabled woman was left alone in a locked car on 

a hot and sunny day, while her attendant went shopping with a 

friend. This woman was unable to open the car door. A concerned 

citizen noticed her in distress and called the police. 

In Vermont, an attendant stole the opioid painkillers prescribed 

for the beneficiary, even though the beneficiary was in significant 

discomfort and pain. This same attendant was on probation for 

drug possession at the time. 

These are just some of the many stories of abuse uncovered by 

the OIG and other authorities. We will discuss them more today. 

We talk about program integrity and high improper payments a 

lot on this subcommittee. We are used to getting into the weeds on 

error rates, methodology, and data collection. 

To help curb fraud in PCS and protect vulnerable beneficiaries, 

Congress acted in the Helping Families in Mental Health Crisis 

Act of 2016 to require the use of an electronic visit verification system for Medicaid-provided PCS and home health services. This became law as part of 21st Century Cures, and when implemented, 

will help ensure that information regarding the services provided 

are verified. 

Having verified data that will help identify waste, fraud, and 

abuse is important because there are real people at risk. Those who 

use the PCS program include our friends and neighbors, who may 

not have the resources or ability to speak up when they encounter 

abuse. This subcommittee and this Congress will not tolerate these 

abuses. 

3 

While it is undoubtedly good policy to keep beneficiaries in their 

homes, it also raises difficult questions which must be addressed. 

How do we protect vulnerable people from abuse in their homes, 

when no one else is around to assess an attendant’s performance? 

What changes can we make, by both Congress and CMS, to improve the program while maintaining access for Medicaid beneficiaries who need these services? 

Both the HHS OIG and the Government Accountability Office 

have done excellent work to highlight the problems within PCS. 

These offices have also suggested ways to solve these problems, 

such as additional beneficiary safeguards, higher standards for attendants, and pre-payment controls. 

I am grateful for your work and look forward to hearing more 

about your findings. 

I understand that CMS has already acted to address some of 

these, but not all, these findings, and we will discuss what CMS 

is doing to address our concerns. 

So thank you to all of our witnesses today for your dedication, 

and great work to protect Medicaid beneficiaries and root out 

waste, fraud, and abuse. I look forward to a productive discussion 

today. 

[The prepared statement of Mr. Murphy follows:] 

PREPARED STATEMENT OF HON. TIM MURPHY

The subcommittee convenes this hearing today to examine Medicaid Personal 

Care Services—a critical lifeline for our Nation’s most vulnerable populations. 

Medicaid is the largest provider of long-term care services for disabled and elderly 

individuals. Lately, long-term care has shifted from nursing homes and institutional 

settings to services provided to beneficiaries in their homes. 

Personal care services, or PCS, provide essential services to Medicaid beneficiaries 

with significant needs so that they can stay in their homes. As they enter this ever 

more vulnerable stage of life, most elderly persons prefer to live in familiar surroundings. 

These are not health services, but rather they assist beneficiaries with daily activities they can no longer do without assistance such as meal preparation, laundry, 

and transportation so that they can continue to live in their communities. 

PCS now makes up a large component of home- and community-based care, and 

continues to grow rapidly. In 2015, Federal and State expenditures for PCS amounted to $15 billion, up from $12.7 billion in 2011. The actual figure is probably significantly higher because this number only reflects fee-for-service claims, and does not 

include managed care. 

The U.S. Department of Labor projected that employment of personal and home 

health aides will grow by 46 percent between 2008 and 2018, which far exceeds the 

average growth of 10 percent for all occupations. 

While the move toward home care has undoubtedly improved the lives of Medicaid 

beneficiaries by allowing them to stay at home—and saves money for taxpayers— 

we cannot turn a blind eye to waste, fraud, and abuse in the Personal Care Services 

program. 

More than 29 reports by the HHS Office of Inspector General have uncovered systemic fraud in PCS. The OIG has uncovered schemes between PCS attendants and 

Medicaid beneficiaries to submit claims for services that were not provided. This 

type of fraud is difficult to detect because attendants can often be a beneficiary’s 

spouse, child or friend. 

Even more troubling is the abuse the HHS OIG’s investigations found. Stories like 

that of a beneficiary in my home State of Pennsylvania dying of exposure to the cold 

while under the care of a PCS attendant. This beneficiary had autism and a history 

of running away, but the attendant left her alone in a crowded shopping mall and 

waited an hour to call authorities. 

In Maryland, a disabled woman was left alone in a locked car on a hot and sunny 

day, while her attendant went shopping with a friend. This woman was unable to 

open the car door. A concerned citizen noticed her in distress and called the police. 

4 

In Vermont, an attendant stole the opioid painkillers prescribed for the beneficiary, even though the beneficiary was in significant discomfort and pain. This 

same attendant was on probation for drug possession at the time. 

These are just some of the many stories of abuse uncovered by the OIG and other 

authorities—We will discuss them more today. 

We talk about program integrity and high improper payments a lot on this subcommittee. We are used to getting into the weeds on error rates, methodology, and 

data collection. 

To help curb fraud in PCS and protect vulnerable beneficiaries, Congress acted 

in the Helping Families in Mental Health Crisis Act of 2016 to require the use of 

an electronic visit verification system for Medicaid-provided PCS and home health 

services. This became law as part of 21st Century Cures, and, when implemented, 

will help ensure that information regarding the services provided are verified. 

Having verified data that will help identify waste, fraud, and abuse is important 

because there are real people at risk—those who use the PCS program include our 

friends and neighbors, who may not have the resources or ability to speak up when 

they encounter abuse. This subcommittee, this Congress, will not tolerate these 

abuses. 

While it is undoubtedly good policy to keep beneficiaries in their homes, it also 

raises difficult questions which must be addressed. 

How do we protect vulnerable people from abuse in their homes, when no one else 

is around to assess an attendant’s performance? 

What changes can we make—by both Congress and CMS—to improve this program while maintaining access for Medicaid beneficiaries who need these services? 

Both the HHS OIG and the Government Accountability Office have done excellent 

work to highlight the problems within PCS. These offices have also suggested ways 

to solve these problems—such as additional beneficiary safeguards, higher standards for attendants, and pre-payment controls. 

I am grateful for your work and look forward to hearing more about your findings. 

I understand that CMS has already acted to address some—but not all—of these 

findings, and we will discuss what CMS is doing to address our concerns. 

Thank you to our witnesses today for your dedication and great work to protect 

Medicaid beneficiaries and root out waste, fraud, and abuse. I look forward to a productive discussion today. 

Mr. MURPHY. I’ll recognize Ms. DeGette for 5 minutes. Our main 

clock is not working, so as a reminder, I will just tap this when 

you reach 5 minutes. Thank you. 

OPENING STATEMENT OF HON. DIANA DEGETTE, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF COLORADO 

Ms. DEGETTE. Thanks, Mr. Chairman. Today, thanks to Medicaid, 74 million vulnerable Americans including seniors, children, 

adults, and people with disabilities have access to quality 

healthcare. And despite what we often hear from our colleagues on 

the other side of the aisle, the Medicaid program delivers this care 

efficiently and effectively. In fact, not only are Medicaid’s costs for 

beneficiaries substantially lower than that of private insurance, but 

they have also been growing more slowly per beneficiary. What is 

more, we know that the Medicaid program literally saves lives. 

Last year, more than 12 million low-income adults had 

healthcare coverage because of the Affordable Care Act Medicaid 

expansion, something I think is an astonishing achievement. Coupled with other important provisions of the ACA, the Medicaid expansion has helped drive the uninsured rate to the lowest level in 

our Nation’s history. 

One of the key components of Medicaid is the Personal Care 

Services program. Personal care services which include assistance 

with activities like bathing, dressing, and meal preparation are an 

important part of long-term care that Medicaid offers to beneVerDate Mar 15 2010 09:58 Aug 02, 2017 Jkt 037690 PO 00000 Frm 00008 Fmt 6633 Sfmt 6633 I:\115THCONGRESS\115X29MEDICAIDPCSXASKOK071317\115X29MEDICAIDPCSXPDFM
5 

ficiaries. This allows beneficiaries to hold on to their independence 

longer and to stay in their homes with dignity. Furthermore, personal care services can save the Government money because they 

can be cheaper than enrolling patients in a nursing home, a lot 

cheaper. 

However, just like other home healthcare services, personal care 

services can be susceptible to improper payment or even to fraud. 

Fraud, abuse, and mismanagement happen wherever large 

amounts of money are spent, both in the public sector and in the 

private sector, and we need to always look for ways to address this. 

But that doesn’t mean the program is ill-conceived or should be 

drastically cut. Instead what it means is we need to focus our efforts on ensuring that the program receives more effective oversight and that we prevent and address these issues. 

As I pointed out before, the ACA provided the Department of 

Health and Human Services and its Office of Inspector General 

with a wide range of new tools and authorities to fight fraud. For 

example, the ACA provided nearly $350 million in new funds for 

fraud control efforts, as well as new means for screening potential 

providers and suppliers. It also provided the HHS and OIG with 

new authorities to impose stronger penalties on those who commit 

fraud and gave the Centers for Medicare and Medicaid Services the 

ability to temporarily halt payments to those suspected of fraud. 

These new tools allow program administrators to better protect tax 

dollars and to move away from the pay-and-chase model by preventing bad providers from ever entering the program. These are 

positive developments. 

But today, we are going to hear from the agencies that there are 

still vulnerabilities related to the PCS program, as well as additional actions that CMS should better take to oversee this program. 

For example, an October 2016 investigative advisory from HHS 

OIG detailed some disturbing cases of PCS fraud and beneficiary 

neglect. These bad actors not only defrauded the program, they 

harmed the patients they were supposed to serve. That advisory 

follows other HHS OIG reports highlighting PCS program 

vulnerabilities that contributed to questionable care services and 

improper payments. 

The OIG continues to recommend that CMS use its authorities 

more effectively to oversee PCS programs across all States to improve program integrity and help the risk of beneficiary harm. 

Similarly, GAO has also found areas for improvement in the PCS 

program. Specifically, the State-reported data that CMS relies on 

for oversight lacks key investigation and there are variations in the 

program requirements across different States. This is an important 

point because States are ultimately responsible for overseeing their 

programs. 

Along these lines, the GAO is also going to testify that some 

States continue to provide inaccurate or untimely data to CMS. We 

need to explore the challenges that States are facing in collecting 

this data and determine why States don’t have additional resources 

to better oversee the program. We need to make sure the program 

is fully resourced and that includes sufficient money to collect and 

analyze data. Given that the States are on the front lines of runVerDate Mar 15 2010 09:58 Aug 02, 2017 Jkt 037690 PO 00000 Frm 00009 Fmt 6633 Sfmt 6633 I:\115THCONGRESS\115X29MEDICAIDPCSXASKOK071317\115X29MEDICAIDPCSXPDFM
6 

ning this important program, I think we need to hear from the 

States about what they are doing. 

And finally, Mr. Chairman, as we talk about waste, fraud, and 

abuse, we should be mindful that the President’s budget blueprint 

threatens agencies like HHS OIG to oversee these programs. The 

OIG said on average it has one full-time employee to oversee more 

than $680 million a year. So I think we need to remedy that if we 

want to stop waste, fraud, and abuse. 

So anyway, in conclusion, thanks for having this hearing. I think 

we are all against waste, fraud, and abuse and we all need to work 

together to make sure that it ends. I yield back. 

Mr. MURPHY. I thank the gentlelady. She yields back. I now recognize the chairman of the full committee. 

OPENING STATEMENT OF HON. GREG WALDEN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF OREGON 

Mr. WALDEN. I thank the gentleman for holding this hearing and 

for our witnesses’ good work and good testimony. We are here 

today to talk about this program which serves our Nation’s most 

vulnerable individuals. Through Medicaid, personal care services 

provide essential care to millions of elderly people, disabled children and adults, and those who need long-term care to cope with 

crippling diseases. It used to be that many of these people ended 

up having to be institutionalized or cared for in a nursing home. 

Instead, personal care services provide an attendant to help people 

do the things like shop for groceries, do the laundry, make sure 

that they are taking their medications right on the schedule. 

Without personal care services and home healthcare at large, 

these folks would not be able to live at home in their communities. 

Personal care services are quite literally a life saver for many. 

I truly believe in programs like personal home services and home 

healthcare. Oregon experimented in these types of programs a long 

time ago. The vast majority of personal care workers are really 

solid people who work hard and take care of people and they care, 

especially they care for these vulnerable populations. They make 

their lives better, healthier, brighter, and easier. 

That is why it is so disturbing when the Office of Inspector General reported these instances of fraud, abuse, and mismanagement 

in this very essential program. Stories of attendants stealing pain 

meds, abandoning mentally ill beneficiaries in public places, leaving elderly folks alone for weeks at a time. This is outrageous and 

it is unacceptable. 

What’s worse is that OIG has made clear that these are not just 

some isolated individual bad actors. The OIG investigations have 

uncovered more than 200 cases of fraud and abuse in the program 

just since 2012. And as we learned from witnesses earlier this year, 

the Government Accountability Office has Medicaid designated as 

a high-risk program since 2003. So we have an obligation to get to 

the bottom of this for the taxpayers and for patients alike. 

Late last year, GAO released a report on the need to harmonize 

requirements for personal care services across various States. GAO 

reviewed the policies and procedures in my home State of Oregon 

and three other States while performing this work. While I was 

heartened to learn about the safeguards Oregon has in place to 

7 

prevent this fraud, the audit made clear there is more work to be 

done. 

More recently, GAO released a second report on the need for better data on PCS. The most recent data at the time of the audit released in 2017 was from 2012. That was 5 years ago. And the data 

GAO did release was incomplete. Without complete and up-to-date 

data, those who are tasked with rooting out waste, fraud, and 

abuse in this program are frankly hamstrung. 

So both the OIG and GAO sounded the alarm for years. This 

fraud and abuse is happening because the States and the Federal 

Government failed to put in safeguards to protect these beneficiaries. It is sickening to see hard-earned tax dollars going to people who take advantage and mistreat the elderly and disabled in 

their own homes. And these beneficiaries are particularly suspect 

to harm because they are often lack the physical or mental ability 

to speak up. Many times a personal care worker is the only person 

a beneficiary may see for weeks at a time, so they go along with 

the fraud or abuse because they are so dependent on that person 

for help. 

We can do better for them. Our citizens deserve to know the attendant they allow into their home, the attendant paid by State 

and Federal taxpayers, will take good care of them and have their 

best interests at heart. And while most do—and most do—it is 

clear we have a serious problem in the program. 

Today, we are here to talk about the steps we’re going to take 

to correct the problems identified for us by the good work by the 

Office of Inspector General and the GAO. 

I would like to thank Ms. Grimm from the OIG, and Ms. Iritani 

from the GAO, for your extraordinary work that exposed this fraud, 

abuse, and mismanagement in the program. You have done a good 

job. Your decades of work culminated in some common-sense recommendations for CMS that will better protect beneficiaries and 

taxpayers. So I look forward to discussing those recommendations 

today and also learning about how Congress can do its part to solve 

these problems. 

Mr. Hill, I especially appreciate your testimony today, too. I understand CMS has taken steps to implement some of the recommendations and is working to make other improvements in the 

program. That is encouraging. I look forward to hearing more 

about your work as well. 

With that, Mr. Chairman, and with apologies to our witnesses, 

we have a couple of subcommittees going on at the same time and 

my duties as full committee chairman drag me between the two. 

So thank you for your good work. I have your testimony. It is most 

helpful. And I return the balance of my time. 

[The prepared statement of Mr. Walden follows:] 

PREPARED STATEMENT OF HON. GREG WALDEN

We are here today to talk about a program that serves our Nation’s most vulnerable individuals. Through Medicaid, personal care services provide essential care to 

millions of elderly people, disabled children and adults, and those who need 

longterm care to cope with crippling disease. 

It used to be that these folks had to be institutionalized or cared for in a nursing 

home. Instead, personal care services provide an attendant to help people do things 

8 

like shop for groceries, do the laundry, drive to the doctor and take medication on 

the right schedule. 

Without personal care services—and home health care at large—these folks would 

not be able to live at home, in their communities. Personal care services are quite 

literally a life-saver for many. 

I truly believe in programs like personal care services and home health care. The 

vast majority of personal care workers are good people who serve vulnerable populations and make the lives of others healthier, brighter and a little easier. 

That’s why I was so disturbed when the Office of Inspector General reported instances of fraud, abuse, and mismanagement in this important program. Stories of 

attendants stealing pain medication, abandoning mentally ill beneficiaries in public 

places, leaving elderly folks alone for weeks at a time—this is outrageous and unacceptable. 

What’s worse, is that OIG has made clear that these are not just individual bad 

actors. The OIG investigations have uncovered more than 200 cases of fraud and 

abuse in the program just since 2012. And as we learned from witnesses earlier this 

year, the Government Accountability Office has Medicaid designated Medicaid as a 

‘‘high risk’’ program since 2003. We have an obligation to get to the bottom of this, 

for the taxpayers and for the patients, alike. 

Late last year, GAO released a report on the need to harmonize requirements for 

Personal Care Services across the various States. GAO reviewed the policies and 

procedures of my home State of Oregon and three other States while performing 

this work. While I was heartened to learn of the safeguards Oregon has in place 

to prevent this fraud, the audit made clear that there is more work to be done. 

More recently, GAO released a second report on the need for better data on PCS. 

The most recent data at the time of the audit-released in 2017-was from 2012. Five 

years ago. And the data GAO did receive was incomplete. Without complete and upto-date data those who are tasked with rooting out waste, fraud, and abuse in this 

program are hamstrung. 

So, both the OIG and GAO have sounded the alarm for years. 

This fraud and abuse is happening because the States and the Federal Government failed to put in safeguards to protect these beneficiaries. 

It is sickening to see hard-earned taxpayer dollars going to people who take advantage of and mistreat elderly and disabled people in their own homes. 

And these beneficiaries are particularly susceptible to harm because they often 

lack the physical or mental ability to speak up. 

Many times, a personal care worker is the only person a beneficiary will see for 

weeks, so they go along with fraud or abuse because they are dependent on their 

attendant for help. 

We can do better. Our citizens deserve to know that the attendant they allow into 

their home, the attendant paid by State and Federal taxpayers, will take good care 

of them and have their best interests at heart. And while most do, it’s clear we have 

a serious problem in this program. 

Today, we are here to talk about the steps we are going to take to correct the 

problems identified for us by the Office of Inspector General and others. 

I would like to thank Ms. Grimm from the OIG and Ms. Iritani from GAO for 

your extraordinary work that has exposed fraud, abuse, and mismanagement in this 

program. Your decades of work have culminated in some common-sense recommendations for CMS that will better protect beneficiaries. 

I look forward to discussing those recommendations today, and also learning 

about how Congress can do its part to solve these problems. 

Mr, Hill, I appreciate your testimony today too. I understand that CMS has taken 

steps to implement some of these recommendations and is working toward improvements. That’s encouraging, and I look forward to learning more about your work as 

well. 

Thank you, Mr. Chairman, for holding this important hearing today. I yield back 

the remainder of my time. 

Mr. MURPHY. The chairman returns the balance of his time and 

yields back. I now recognize the gentleman from New Jersey, Mr. 

Pallone, for 5 minutes. 

9 

OPENING STATEMENT OF HON. FRANK PALLONE, JR., A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEW JERSEY 

Mr. PALLONE. Thank you, Mr. Chairman. This committee has a 

long-standing history of examining fraud and abuse in Medicaid 

and we should continue to find ways to improve the vital programs, 

including the Personal Care Services program. But it is important 

to keep these issues in context. Medicaid is a critical program that 

provides essential healthcare to more than 74 million Americans, 

including seniors, children, pregnant women, and people with disabilities. Now with the expansion of Medicaid under the Affordable 

Care Act, more than 12 million people gained health insurance coverage last year. Additional achievements under the ACA have 

helped improve the quality, accessibility, and affordability of 

healthcare for millions of Americans. 

We have made historic gains and we must not roll back this 

progress by cutting essential health programs such as Medicaid. 

The Republican Trumpcare bill which the Republican leadership is 

still trying to convince members to support, drastically cuts and 

caps the Medicaid program. It rations care for millions in order to 

give giant tax breaks to the wealthy and corporations. By allowing 

a State to arbitrarily cap coverage or provide a block grant for certain enrollees, Trumpcare would result in mass rationing of care 

for seniors in nursing homes, pregnant women, working parents, 

and people living with disabilities. 

Instead, it is imperative that we make every effort to ensure Federal and State dollars are spent effectively. While Medicaid is already an incredibly lean program that has among the lowest improper payment rates of any Federal health program, we should always be looking at ways to prevent any fraud, waste, or abuse in 

any Federal program. The HHS Office of Inspector General has reported on improper payments, questionable care quality, and fraud 

in the PCS program and I am particularly concerned by OIG’s investigative advisory that highlighted stories of vulnerable patients 

who were neglected and even harmed by the PCS providers entrusted with their care. 

So I am committed to working with my colleagues to address 

these issues and the root causes of fraud, waste, and abuse. However, any solution we consider to address the problems in the PCS 

program should be designed primarily to serve one constituency, 

and that is vulnerable Medicaid patients. We must root out fraud 

and abuse, but we should not use potential fraud and abuse as an 

excuse to harm the people these programs are intended to serve. 

In other words, the answer to Medicaid fraud is not to cut coverage 

or reduce benefits. The answer to beneficiary harm and neglect is 

not to institute work requirements and the answer to abusive providers is not to drug test low-income beneficiaries. Instead, we 

should be strengthening oversight so that bad actors are not allowed into the program, all beneficiaries get the care they need, 

and the American tax dollars are protected. 

The PCS program is a great example of the type of crucial services that we should be protecting and strengthening. PCS attendants help patients with daily activities such as bathing and dressing which gives Medicaid patients more freedom and dignity by alVerDate Mar 15 2010 09:58 Aug 02, 2017 Jkt 037690 PO 00000 Frm 00013 Fmt 6633 Sfmt 6633 I:\115THCONGRESS\115X29MEDICAIDPCSXASKOK071317\115X29MEDICAIDPCSXPDFM
10 

lowing them to stay in their homes. Medicaid is the majority payer 

of long term care services and supports for seniors and individuals 

with disabilities and personal care services are a critical benefit for 

these populations. 

The HHS OIG has done important work on this issue that has 

benefitted the committee’s past bipartisan work and no doubt will 

continue to benefit this committee if given the proper resources and 

that is one of the many reasons why I’m so concerned about President Trump’s budget blueprint which threatens to undermine the 

important work of agencies like the HHS OIG. 

We will also hear from GAO about the challenges posed by various PCS program requirements across different States and how 

the States have not provided accurate data on the PCS program. 

Because Medicaid is a Federal-State partnership, we need both 

CMS and the States to do their part in conducting oversight. 

And finally, Mr. Chairman, I would like to thank the witnesses 

today for their commitment to strengthening the Medicaid program 

and serving its beneficiaries. Instead of rolling back the progress 

we’ve made, we must continue to find ways to improve oversight 

of these vital programs and I don’t think anybody else wants my 

time, so I will yield back, Mr. Chairman. 

[The prepared statement of Mr. Pallone follows:] 

PREPARED STATEMENT OF HON. FRANK PALLONE, JR. 

Thank you, Mr. Chairman. This committee has a longstanding history of examining fraud and abuse in Medicaid. We should continue to find ways to improve 

these vital programs, including the Personal Care Services (PCS) program. But it 

is important to keep these issues in context. 

Medicaid is a critical program that provides essential health care to more than 

74 million Americans—including seniors, children, pregnant women, and people 

with disabilities. 

Now with the expansion of Medicaid under the Affordable Care Act (ACA), more 

than 12 million people gained health insurance coverage last year. Additional 

achievements under the ACA have helped improve the quality, accessibility, and affordability of health care for millions of Americans. 

We have made historic gains, and we must not roll back this progress by cutting 

essential health care programs such as Medicaid. The Republican Trumpcare bill, 

which the Republican leadership is still trying to strong-arm Members into supporting, drastically cuts and caps the Medicaid program. It rations care for millions 

in order to give giant tax breaks to the wealthy and corporations. By allowing a 

State to arbitrarily cap coverage or provide a block grant for certain enrollees, 

Trumpcare would result in mass rationing of care for seniors in nursing homes, 

pregnant women and working parents, and people living with disabilities. 

Instead, it is imperative that we make every effort to ensure Federal and State 

dollars are spent effectively. While Medicaid is already an incredibly lean program 

that has among the lowest improper payment rates of any Federal health program, 

we should always be looking at ways to prevent any fraud, waste, or abuse in any 

Federal program. 

The HHS Office of Inspector General has reported on improper payments, questionable care quality, and fraud in the PCS program. I am particularly concerned 

by OIG’s investigative advisory that highlighted stories of vulnerable patients who 

were neglected and even harmed by the PCS providers entrusted with their care. 

I am committed to working with my colleagues to address these issues and the 

root causes of fraud, waste, and abuse. However, any solution we consider to address the problems in the PCS program should be designed primarily to serve one 

constituency: vulnerable Medicaid patients. We must root out fraud and abuse, but 

we should not use potential fraud and abuse as an excuse to harm the people these 

programs are intended to serve. 

In other words, the answer to Medicaid fraud is not to cut coverage or reduce benefits. The answer to beneficiary harm and neglect is not to institute work requireVerDate Mar 15 2010 09:58 Aug 02, 2017 Jkt 037690 PO 00000 Frm 00014 Fmt 6633 Sfmt 6633 I:\115THCONGRESS\115X29MEDICAIDPCSXASKOK071317\115X29MEDICAIDPCSXPDFM
11 

ments. And the answer to abusive providers is not to drug test low-income beneficiaries. 

Instead, we should be strengthening oversight so that bad actors are not allowed 

into the program, all beneficiaries get the care they need, and Americans’ tax dollars are protected. 

The PCS program is a great example of the type of crucial services that we should 

be protecting and strengthening. PCS attendants help patients with daily activities 

such as bathing and dressing, which gives Medicaid patients more freedom and dignity by allowing them to stay in their homes. Medicaid is the majority payer of longterm care services and supports for seniors and individuals with disabilities, and 

personal care services are a critical benefit for these populations. 

The HHS OIG has done important work on this issue that has benefitted the committee’s past bipartisan work, and no doubt will continue to benefit this committee 

if given the appropriate resources. That is one of the many reasons why I am so 

concerned about President Trump’s budget blueprint, which threatens to undermine 

the important work of agencies like the HHS OIG. 

We will also hear from GAO about the challenges posed by varying PCS program 

requirements across different States, and how the States have not provided accurate 

data on the PCS program. Because Medicaid is a Federal-State partnership, we 

need both CMS and the States to do their part in conducting oversight. 

Mr. Chairman, I would like to thank the witnesses today for their commitment 

to strengthening the Medicaid program and serving its beneficiaries. Instead of rolling back the progress we have made, we must continue to find ways to improve 

oversight of these vital programs. 

Thank you, and I yield back. 

Mr. MURPHY. The gentleman yields back. So let’s begin. I ask 

unanimous consent that the Members’ written opening statements 

be introduced into the record, and without objection the documents 

will be entered into the record. 

I now would look to introduce our panel of Federal witnesses for 

today’s hearing. First, we welcome Ms. Christi Grimm, Chief of 

Staff of the Department of Health and Human Services, Office of 

Inspector General. With nearly 2 decades of leadership and expertise in HHS programs, Ms. Grimm manages the operation and resources of the immediate Office of Inspector General and is responsible for effective execution of OIG priority initiatives, advising on 

a wide variety of policy and operational matters. 

Next, we welcome Ms. Katherine Iritani. Have I said that right? 

Good. Director of Healthcare Issues at the U.S. Government Accountability Office. In her 36-year career with GAO, Ms. Iritani has 

helped lead a wide variety of programs and evaluation assignments 

for Congress. In recent years, she has overseen Medicaid financing, 

payment, access, and long-term care issues, including program 

oversight issues contributing to Medicaid being designated as a 

high-risk program. 

And last, we would like to welcome Mr. Timothy Hill, Deputy Director for the Center for Medicaid and CHIP Services, CMCS, and 

the Centers for Medicaid and Medicare Services at HHS. As Deputy Director at CMCS, Mr. Hill leads activities related to national 

Medicaid and CHIP policy and program operations and works 

closely with States in the implementation of their Medicaid and 

CHIP programs. 

So I thank all the witnesses for being here today and providing 

testimony. We look forward to productive discussion on how we can 

strengthen and combat waste, fraud, and abuse reform in the PCS 

program. 

12 

As you are aware, the committee is holding an investigative 

hearing and when doing so has the practice of taking testimony 

under oath. Do any of you have objection to testifying under oath? 

Seeing no objections, the Chair then advises you that under the 

rules of the House and the rules of the committee, you are entitled 

to be advised by counsel. Do any of you desire to be advised by 

counsel during testimony today? And seeing none there, then will 

you please rise and raise your right hand. I will swear you in. 

Do you swear the testimony you are about the give is the truth, 

the whole truth, and nothing but the truth? 

[Witnesses sworn.] 

Thank you. All of you are now sworn in under oath and subject 

to the penalties set forth in Title 18 Section 1001 of the United 

States Code. 

We will have you each give a 5-minute summary of your written 

statement and we’ll begin with Ms. Grimm, you are recognized. 

STATEMENT OF CHRISTI A. GRIMM, CHIEF OF STAFF, OFFICE 

OF INSPECTOR GENERAL, DEPARTMENT OF HEALTH AND 

HUMAN SERVICES; KATHERINE M. IRITANI, DIRECTOR, 

HEALTH CARE, GOVERNMENT ACCOUNTABILITY OFFICE; 

AND TIM HILL, DEPUTY DIRECTOR, CENTER FOR MEDICAID 

AND CHIP SERVICES, CENTERS FOR MEDICARE AND MEDICAID SERVICES, DEPARTMENT OF HEALTH AND HUMAN 

SERVICES 

STATEMENT OF CHRISTI A. GRIMM 

Ms. GRIMM. Good morning, Chairman Murphy, Ranking Member 

DeGette, and other distinguished members of the subcommittee. I 

am Christi Grimm, Chief of Staff of the Office of Inspector General 

for the U.S. Department of Health and Human Services. 

Thank you for the opportunity to appear before you to discuss 

the importance of protecting Medicaid personal care services from 

fraud, waste, and abuse and protecting beneficiaries from abuse 

and neglect. The Personal Care program has been one of OIG’s top 

management concerns for the past 8 years. My testimony today will 

highlight our work overseeing the Personal Care program and 

progress the Department has made in implementing our recommendations. 

In the last 5 years, often with our State partners, OIG has 

opened more than 200 investigations involving fraud and patient 

harm in the Personal Care program. For example, as the chairman 

pointed out in his opening, in Pennsylvania, a personal care attendant who was hired to provide close supervision to a beneficiary lost 

her while shopping in a department store. The attendant waited an 

hour before notifying the authorities. The beneficiary was found the 

next day dead from exposure to the cold. This harm is something 

no one should ever have to experience. Systemic problems must be 

rectified so that the Federal and State Governments can prevent 

similar tragedies. 

In the past decade, OIG has issued more than 30 reports pertaining the Personal Care which recommended the recovery of almost $700 million. OIG’s November 2012 Personal Care portfolio 

summarized the findings of OIG’s body of work which found that 

13 

Personal Care payments were often improper because the services 

did not comply with basic requirements. 

OIG’s October 2016 Investigative Advisory documented common 

fraud schemes including payments for services that were unnecessary or not provided and resulted in death, hospitalization, and less 

degrees of beneficiary harm. Collectively, our work demonstrates 

the persistent vulnerabilities in personal care that contribute to 

high improper payments, significant fraud, and that place vulnerable beneficiaries at risk. Bad actors are exploiting policy 

vulnerabilities and diverting Personal Care resources. 

OIG’s long history of oversight and enforcement has consistently 

demonstrated that basic pillars of program integrity prevention, detection, and enforcement are lacking in the Personal Care program. 

We must prevent bad actors from participating in our programs, 

detect potential fraud, waste, and abuse and beneficiary harm, and 

enforce the laws through Federal and State investigations and 

prosecutions. 

When these basic safeguards are in place, they have a dramatic 

effect on our ability to identify and stop fraud, waste, and abuse. 

For example, Alaska implemented a requirement that all Personal 

Care attendants enroll with the State Medicaid Agency. Attendant 

enrollment data helped Alaska detect potential patterns of fraud 

and help strengthen cases for prosecution. In 2 short years, that 

data helped Alaska to investigate and obtain 108 criminal convictions and recover $5.6 million. 

CMS has concurred with our top recommendations for improving 

the Personal Care program. In 2016, CMS issued a request for information, guidance, and provided training to States and providers 

resulting in improvements to the Personal Care program. Notwithstanding this progress, much remains to be done. As of today, four 

OIG recommendations from the 2012 portfolio remain 

unimplemented. 

First, CMS should establish minimum Federal qualifications and 

screening standards for all personal care attendants. 

Second, CMS should require States to enroll or register all personal care attendants and assign them unique identification numbers. 

Third, CMS should require that Personal Care claims identify 

the dates of services and who provided those services. 

Finally, CMS should consider whether additional controls are 

needed to ensure that Personal Care Services are allowed under 

program rules and are provided. 

OIG work has demonstrated that Personal Care is subject to persistent fraud and beneficiary harm. CMS, in partnership with 

States, must implement basic safeguards to protect this critical 

benefit that allows millions of beneficiaries to remain in their 

homes and communities. Combating fraud and patient harm in 

Personal Care not only protects beneficiaries and programs, but 

also elevates the many honest, professional, and dedicated care attendants that enable beneficiaries to live independently. 

Again, thank you for the opportunity to testify this morning. I 

am happy to answer any questions you have. 

[The prepared statement of Ms. Grimm follows:] 

14 


Testimony Before the United States House of Representatives 

Committee on Energy and Commerce 

Subcommittee on Oversight and Investigations 

May 2, 2017 

10:15 a.m. 

Location: Rayburn House Office Building, Room 2322 
15 


Testimony of: 

Christi A. Grimm 

Chief of Staff 

Office of Inspector General, U.S. Department of Health and Human Services 

Good morning, Chairman Murphy, Ranking Member DeGette, and other distinguished 

Members of the Subcommittee. I am Christi Grimm, Chief of Staff of the Office of Inspector 

General (OIG) of the U.S. Department of Health and Human Services. 

Thank you for the opportunity to appear before you to discuss the importance of 

protecting Medicaid personal care services (personal care or PCS) from fraud, waste, and abuse 

and protecting the beneficiaries who rely on those services from abuse and neglect. OIG has an 

extensive body of work examining vulnerabilities in PCS and recommending improvements to 

address the lack of program integrity safeguards, high improper payments, and health and 

safety vulnerabilities. Safeguarding beneficiaries and the Medicaid PCS program through better 

program integrity continues to be one of OIG's top priorities. 

In the last 5 years, OIG has opened more than 200 investigations involving fraud and 

patient harm and neglect in the PCS program across the country. Sadly, some of these cases 

have involved loss of life and serious harm to Medicaid beneficiaries who are especially 

vulnerable. These include cases like the elderly woman in Idaho who was hospitalized to treat 

malnutrition and dehydration because the caregiver failed to provide water and food. When 

investigators served a search warrant suspecting she was a victim of neglect, they found that 

she had been living in filth despite the fact that Medicaid was paying a PCS attendant to care for 

House Committee on Energy and Commerce, Subcommittee on Oversight and Investigations 

May 2, 2017 
16 


her everyday needs. Or the Pennsylvania beneficiary with autism who died of exposure to the 

cold while under the care of an attendant. The attendant lost the beneficiary in a crowded 

store and waited an hour to notify authorities. 

These are just two of the heartbreaking stories that no one should ever experience, 

regardless of the State they live in or what type of personal care services they receive. OIG is 

testifying today to highlight the important needs that an effective Medicaid PCS program serves 

and identify ways to help the program better fulfill that potential. Systemic problems related to 

the design and delivery of Medicaid PCS must be rectified so that the Federal Government can 

help prevent similar tragedies from happening in the future and better combat fraud, waste, 

and abuse. My testimony today will highlight: our work overseeing the PCS program; the 

problems we have identified; our recommendations for improvement; and the progress to 

date. 

Background on Medicaid Personal Care Services 

PCS enable Medicaid beneficiaries who are elderly, have disabilities {including children 

with disabilities), or have chronic or temporary conditions to live with as much independence as 

possible in their homes and communities, rather than in nursing homes or institutions. The 

services provided by PCS attendants include a broad range of nonmedical services to support 

Activities of Daily Living- bathing, dressing, toileting, and personal hygiene. PCS can also offer 

support for Instrumental Activities of Daily living, such as meal preparation, money 

management, shopping, and telephone use. The services place providers directly in the homes 

House Committee on Energy and Commerce, Subcommittee on Oversight and Investigations 

May 2, 2017 2 
17 


of our most vulnerable beneficiaries, heightening the risk of fraud and abuse of the program, 

and abuse or neglect of the beneficiary. 

While PCS is an optional Medicaid benefit, all States provide this benefit to some 

Medicaid beneficiaries in their State under their State plan or through home- and communitybased services waivers. PCS are generally provided under either an agency-directed or selfdirected model. Under an agency-directed model, a personal care agency is an enrolled 

Medicaid provider and employs personal care attendants to provide services in beneficiaries' 

homes. Under a self-directed model, the beneficiary or their representative has the 

responsibility for managing the delivery of PCS, including hiring the personal care attendant. 

These options allow States to have significant flexibility when designing PCS programs to meet 

the needs of their beneficiaries. As a result, States often have several different programs that 

provide PCS to a wide range of Medicaid beneficiaries. 

Recent data suggest that PCS will continue to grow rapidly, partly because of the aging 

baby boom population. For example, the U.S. Department of Labor, Bureau of Employment 

Statistics, in its Occupational Outlook Handbook, 2016-2017 edition, projected that 

employment of personal care aides will grow by 26 percent from 2014 to 2024. This growth is 

faster than the average for all occupations. As of 2012, more than 3.2 million beneficiaries 

relied on personal care, and in fiscal year 2014, Federal and State spending on personal care 

totaled $14.5 billion, or about 18 percent of Medicaid's spending on home- and communitybased services. Growth in personal care and other home- and community-based services has 

House Committee on Energy and Commerce, Subcommittee on Oversight and Investigations 

May 2, 2017 3 
18 


come about, in part, to fulfill the mandate of the United States Supreme Court in its decision in 

0/msteadv. L.C., 527 U.S. 581 (1999) to help individuals with disabilities to live and be cared for 

in their homes and communities whenever possible. 

PCS Program Vulnerabilities 

For the past 8 years, OIG has identified program integrity for home- and communitybased services, particularly PCS, as a top management concern. We have issued more than 30 

audits and evaluations, recommending the recovery of over $700 million and improvements to 

service delivery. OIG, often in partnership with the State Medicaid Fraud Control Units (MFCU), 

has investigated hundreds of PCS fraud schemes. Our work demonstrates the persistent 

vulnerabilities in PCS that contribute to high improper payments, significant fraud, and that 

place vulnerable beneficiaries at risk for abuse and neglect. 

OIG's October 2016 Investigative Advisory on Medicaid Fraud and Patient Harm 

Involving Personal Care Services summarized various PCS fraud schemes OIG has seen in 

Federal investigations. These cases show that PCS fraud takes many forms. Common schemes 

involve payments for PCS that were unnecessary or not provided. Some PCS investigations 

have uncovered schemes organized by caregiving agencies that involve numerous attendants 

and beneficiaries, while other investigations have targeted individual attendants and the 

beneficiaries these attendants claim to serve. 

House Committee on Energy and Commerce, Subcommittee on Oversight and Investigations 

May 2, 2017 4 
19 


For example, in 2016 OIG investigated a PCS attendant who submitted duplicate time 

sheets to claim payment for services not rendered to multiple clients with developmental 

disabilities. Although Medicaid was paying the PCS attendant to clean and cook for the clients 

and help integrate them into the community, some clients lived in squalor. The PCS attendant 

also endangered clients by driving while impaired by pain pills. Increased data and internal 

controls would have revealed that services were not being provided to the beneficiaries. 

Federal qualifications and screening standards would have revealed the attendant's own 

substance abuse problems, providing beneficiaries and their families with valuable background 

information with which to make care decisions. 

MFCUs are often on the front lines of investigating fraud in PCS. MFCUs regularly report 

PCS as a top fraud concern; between fiscal years 2012 and 2015, approximately one-third of 

their convictions involved PCS attendants. OIG consistently partners with MFCUs to combat 

PCS fraud across the country. In June 2016, OIG participated in a National Health Care Fraud 

Takedown and partnered with 24 MFCU offices on health care fraud issues, including Medicaid 

PCS fraud. OIG has ongoing work exploring MFCUs' efforts to combat PCS fraud. We expect to 

issue the results this summer. 

Although MFCUs are vital in the fight against fraud because of their position on the front 

lines, they are limited in their ability to investigate allegations of patient abuse or neglect by 

personal care attendants. MFCUs lack the authority to investigate Medicaid patient abuse or 

neglect that occurs in a home- or community-based setting. A legislative change is needed to 

House Committee on Energy and Commerce, Subcommittee on Oversight and Investigations 

May 2, 2017 5 
20 


expand MFCUs' statutory mission to include the investigation of abuse and neglect in 

beneficiaries' homes. 

OIG's November 2012 Personal Core Services: Trends, Vulnerabilities, and 

Recommendations for Improvement (PCS Portfolio) summarized the findings of OIG's body of 

work on PCS and made recommendations to improve program vulnerabilities. OIG found that 

PCS payments were often improper because the services did not comply with basic 

requirements. OIG also found that there were inadequate controls in place to ensure proper 

payments and quality of care. PCS services and controls vary significantly from State to State 

because of a lack of Federal requirements for PCS and PCS attendants. This lack of consistency 

across and within States regarding the use of internal controls and qualifications makes it 

difficult to effectively pursue fraud and abuse in the PCS program. 

Prevention, Detection, and Enforcement of PCS Fraud and Abuse 

OIG's long history of oversight and enforcement has demonstrated that to effectively 

combat fraud, waste, and abuse and safeguard beneficiaries, action must be taken to 

prevent bad actors from participating in our programs, 

detect potential fraud, waste, or quality concerns quickly, and 

enforce the laws of these programs through Federal and State investigations and 

prosecutions of fraudulent and abusive practices. 

House Committee on Energy and Commerce, Subcommittee on Oversight and Investigations 

May 2, 2017 6 
21 


OIG's work has consistently demonstrated that these basic pillars of program integrity 

are lacking in PCS. 

Prevent. First, there is a lack of basic Federal qualifications for PCS attendants. As a 

result, the Government does not consistently know who they are doing business with and 

cannot effectively prevent bad actors from serving beneficiaries and billing the Medicaid 

program. PCS places attendants directly in the homes of elderly or disabled beneficiaries who 

may be particularly vulnerable, creating a real risk of patient abuse and neglect. Requiring all 

PCS attendants to meet basic, minimum qualifications, such as having a State identification 

card, minimum age requirements, and a background check, better ensures that only qualified 

attendants are providing care. Requiring these minimum qualifications also ensures that 

necessary steps are being taken to prevent bad actors from committing fraud and harm in this 

important program. Some States currently require these basic safeguards in some of their PCS 

programs, but not in others. It is important that States have flexibility to implement various 

types of PCS to appropriately tailor these programs to the specific needs of their beneficiaries. 

However, that flexibility must be balanced with the need to provide all beneficiaries with the 

protections of these basic safeguards. Thus, 0/G continues to recommend that CMS establish 

minimum Federal qualifications and screening standards (or all PCS attendants. 

Detect. Second, PCS attendants are not required by Federal law to be enrolled as 

providers or otherwise registered by States. As a result, we lack consistent information across 

States on who is actually entering the beneficiary's home. Without this critical information, we 

House Committee on Energy and Commerce, Subcommittee on Oversight and Investigations 

May2,2017 7 
22 


cannot quickly identify and investigate a bad actor, including those who have engaged in fraud 

or abuse in other States. A single PCS attendant may provide services to multiple beneficiaries, 

putting each of them at risk. In addition, that same PCS attendant may have fraudulently 

claimed reimbursement for services not actually provided by billing for services provided to 

multiple beneficiaries at the same time. Without knowing the individual who is providing the 

services to a beneficiary, detecting fraud and abuse is severely hampered. Accordingly, OIG 

continues to recommend that CMS require States to enroll or register all PCS attendants and 

assign them unique numbers. This information will make it possible to protect beneficiaries 

and identify potential fraud more quickly, and assure that minimum qualifications are met. 

Enforce. Third, to mitigate improper payments and fraud in PCS, 0/G recommends that 

CMS require that PCS claims identify the dates of service and the PCS attendant who provided 

the service. When States have adopted measures that make available better data about PCS, it 

has a dramatic effect on the ability to identify and take action to stop fraud, waste, and abuse. 

For example, Alaska implemented a requirement that all PCS attendants be enrolled with the 

Medicaid agency. This allowed the Alaska MFCU and the Alaska Program Integrity Unit to 

compare and match provider information against other data, such as Medicaid claims. Having 

that provider data available significantly improved their capability to investigate bad actors. In 

a short span of 2 years, that type of data analysis helped support 108 criminal convictions and 

led to $5.6 million in restitution. It also had a sentinel effect that helped the State reduce its 

PCS costs from $125 million in 2013 to $85 million in 2015. 

House Committee on Energy and Commerce, Subcommittee on Oversight and Investigations 

May 2, 2017 8 
23 


As this example shows, better data leads to better enforcement and reduced costs. The 

savings achieved through better program integrity could provide funding for increased services 

to a larger number of beneficiaries in need, increasing access to critical care. Access to reliable 

national PCS data allows fuller visibility into the program operations, vulnerabilities, and even 

best practices. In addition, service-specific PCS data are critical to ensuring that oversight and 

enforcement efforts are able to find fraud, waste, and abuse quickly and protect vulnerable 

beneficiaries from harm. 

21" Century Cures includes some promising steps forward to safeguard beneficiaries 

and makes better data available for the PCS program by requiring that all States implement 

electronic visit verification systems (EVVS) by 2019. The law requires that EVVS collect 

information on who receives and who provides the service; the service performed; and the 

date, time, and location of the service. As States begin implementing these new requirements, 

it will be important to ensure that the data gathered is complete, accurate, and timely. 

As the PCS program grows and evolves, OIG continues to recommend that CMS consider 

whether additional controls are needed to ensure that PCS are allowed under program rules 

and are provided. 

Progress in Implementation of OIG Recommendations 

Notwithstanding progress, much remains to be done. To date, four PCS 

recommendations remain unimplemented, and two have been implemented. 

House Committee on Energy and Commerce, Subcommittee on Oversight and Investigations 

May 2, 2017 9 
24 


OIG has worked with CMS to explore actions that it can take to address vulnerabilities in 

the delivery of PCS. CMS has issued an informational bulletin, Strengthening Program Integrity 

in Medicaid Personal Care Services (December 2016), that summarizes program integrity 

vulnerabilities and highlights safeguards States can use right now to strengthen program 

integrity in PCS. In addition, CMS has issued guidance, entitled Preventing Medicaid Improper 

Payments for Personal Care Services (July 2016), describing steps that PCS agencies and 

attendants can take to prevent improper payments. CMS also issued a Request for Information 

(RFI) entitled Federal Government Interventions to Ensure the Provision of Timely and Quality 

Home and Community Based Services (November 2016). CMS conducted a series of trainings, 

webinars, and conferences with States. These activities outlined approaches for States to 

identify overpayments. As a result, OIG closed the two recommendations related to adequate 

prepayment controls and data States need to identify when beneficiaries are receiving 

institutional care paid for by Medicare or Medicaid. 

We have four recommendations that remain unimplemented: 

1. Establish minimum Federal quali(icatians and screening standards tar PCS workers, 

including background checks. 

2. Require States to enroll or register all PCS attendants, and assign them unique numbers. 

3. Require that PCS claims identify the dates of service and the PCS attendant who provided 

the service. 

House Committee on Energy and Commerce, Subcommittee on Oversight and Investigations 

M~~wu w 
25 


4. Consider whether additional controls are needed to ensure that PCS are allowed under 

program rules and are provided. 

The RFI sought stakeholder comments, information, and data on policy options that 

CMS can consider to address issues affecting home- and community-based services, including 

PCS. CMS has indicated that it is currently analyzing the comments it received to determine 

potential policy options. Depending on the actions CMS chooses to take, these 

recommendations could be resolved. 

Conclusion 

OIG work has demonstrated that PCS is subject to persistent fraud and beneficiary 

harm. CMS, in partnership with States, must implement basic safeguards to preserve this 

critical benefit that allows millions of beneficiaries to remain in their homes and communities. 

Combatting fraud and abuse in PCS not only protects beneficiaries and programs, but it also 

elevates the many honest, professional, and dedicated care attendants that enable 

beneficiaries to live independently. OIG is committed to the program integrity of home- and 

community-based services and ensuring beneficiary health and safety. To achieve that goal, 

OIG will continue to work with CMS and partner with other oversight agencies like MFCUs, the 

Department of Justice, the Administration for Community Living, and the Department of Health 

and Human Services' Office of Civil Rights. 

House Committee on Energy and Commerce, Subcommittee on Oversight and Investigations 

May 2, 2017 11 
26 

Mr. MURPHY. Thank you, Ms. Grimm. 

Ms. Iritani, you are recognized for 5 minutes. 

STATEMENT OF KATHERINE M. IRITANI 

Ms. IRITANI. Chairman Murphy, Ranking Member DeGette, and 

members of the subcommittee, I am pleased to be here to discuss 

GAO’s work on Medicaid personal care services. The number of 

people receiving these services is significant and growing. Medicaid 

is the Nation’s primary payer of long-term services and supports 

including those provided in homes and community settings. 

Personal care services are critical to helping people age in place, 

maintain independence, and participate in community life to the 

fullest extent possible. These services are not without risk, both for 

beneficiary safety and for improper payments. Regarding safety, 

beneficiaries receiving these services include older adults and individuals with disabilities, some of whom could be vulnerable. 

Regarding improper payments, personal care services are among 

the higher types at risk of being improper. One known concern is 

with Medicaid being billed for care that was never provided to the 

beneficiary. 

My testimony today is based on two recent GAO reports that examined Federal requirements for programs providing personal care 

services and data available for oversight. 

Now, typically, I would start my statement with some key facts 

about these services, such as the Federal requirements in place to 

protect beneficiaries from harm and to ensure that services billed 

to Medicaid were actually provided, and basic facts about these important services, such as the number of beneficiaries receiving 

them in States and at what cost. But as you’ll hear today, these 

key points of fact are not easily laid out. 

I have three key observations from our work. First, there are 

multiple different program authorities under which States can provide personal care services in Medicaid. Since the program’s inception in 1965, States have been required to cover institutional, but 

not home and community-based care. Since 1975, several different 

options to provide home and community services have been provided to States. All States have adopted one or more different programs to varying degrees. How States screen, train, and monitor 

attendants and ensure billed services are provided varies, not only 

between States, but even within States, by program. 

A second key finding in our work: the Federal requirements CMS 

has in place for oversight of beneficiaries’ safety and provision of 

services vary significantly between the different types of programs. 

Approaches for measuring quality assurance, defining and monitoring critical incidents, screening attendants to ensure they are 

not bad actors and then ensuring billed services are provided can 

and do vary significantly between programs. These differing requirements result in uneven safeguards for beneficiaries, depending on the program they are enrolled in; uneven assurances regarding oversight of billed services; and complexities for States and others administering and overseeing services. 

A third key finding of our work relates to the data CMS needs 

for oversight. Our work found that data available to CMS on the 

provision of and spending on personal care services are not always 

27 

timely, complete, consistent, or accurate. For example, data lags 

caused by late submissions from States and other problems can 

mean CMS lacks good data for years on the services States have 

provided. 

At the time of our work conducted in 2016 largely, the best available data were for 2012 and only available for 35 of the States that 

provided these services. For those 35 States where we had data, 15 

percent, amounting to nearly $5 billion in claims, lacked provider 

identification numbers; 34 percent, amounting to over $5 billion in 

claims, lacked information on the quantity of services provided; and 

more than 400 different procedure codes were used by States to 

identify personal care services. 

Without good data, CMS cannot effectively perform key management functions such as ensuring State claims are appropriate, ensuring appropriate Federal matching, identifying program risks, 

and monitoring access and spending trends. 

In recent years, Congress has directed HHS to improve coordination of home and community-based programs in Medicaid. CMS has 

taken steps to do so, and more can be done. In view of the growth 

in, the demand for, and the cost of Medicaid home and communitybased services and the importance of these services to the beneficiaries who rely on them, Federal leadership to improve data and 

better harmonize requirements among different types of programs 

is needed. 

Mr. Chairman, this concludes my statement. I’m happy to answer any questions. 

[The prepared statement of Ms. Iritani follows:] 

28 


For Release on Delivery 

Expected at 10:15 a.m. ET 

Tuesday, May 2, 2017 

GA0-17-598T 

United States Government Accountability Office 

Testimony 

Before the Subcommittee on Oversight 

and Investigations, Committee on 

Energy and Commerce, 

House of Representatives 

MEDICAID PERSONAL 

CARE SERVICES 

More Harmonized 

Program Requirements 

and Better Data Are 

Needed 

Statement of Katherine M. lritani 

Director, Health Care 
29 


MEDICAID PERSONAL CARE SERVICES 

More Harmonized Program Requirements and 

Better Data Are Needed 

In its November 2016 report, GAO found a patchwork of federal requirements 

related to how states must protect the safety in their personal 

care services and to how states ensure that services are actually 

provided. help beneficiaries with basic activities of daily 

living such as bathing and dressing, in a home- or community~based setting. For two 

types of programs under which personal care services can be offered, states 

must describe to the Centers for Medicare & Medicaid Services (CMS) how they 

will ensure the health and welfare of beneficiaries. Similar requirements were not 

in place for several other programs GAO examined. In addition, for some but not 

all personal care services programs that GAO reviewed, states must provide 

evidence to CMS that the state is claims for services that have actually 

been These dlffering program requirements result in uneven 

and levels regarding states' beneficiary 

services. recommended that CMS take 

harmonize achieve a more consistent application of federal 

1equntmJ<m<S across programs. CMS agreed with GAO's recommendation and 

sought input on how to do so by publishing a request for information. 

In its January 2017 report, GAO found limitations in the data that CMS collects to 

monitor the provision of personal care services and to monitor state spending on 

services. For example: 

• Data on personal care services provided were often not timely, 

complete or consistent. The most recent data available during GAO's 

review (2016) were for 2012 and included data for only 35 states. Further, 15 

percent of claims provider identification numbers and 34 percent 

lacked information provided. Oat a were also 

procedure codes were used by states 

care services. Without timely, complete, and consistent 

unabte to effectively oversee state programs and verify who ls 

personal care services or the type, amount, and dates of services 

Data on states' spending on CMS's expenditure reports, the basis for 

states' receipt of federal matching funds, were not always accurate or 

complete. From 2012 through 2015, 17 percent of expenditure lines were 

not correctly by states, according to GAO's analysis. Nearly twothirds errors were due to states not separately identifying personal 

exJlendltiJres, as required byCMS, from other types of 

incomplete data limit CMS's ability to, among 

ensure federal matching funds are appropriate. 

GAO made several recommendations to improve the data CMS collects to 

monitor the of and expenditures on personal care services. CMS 

agreed some but not all of these recommendations. 

-------------United States Government Accountability Office 
30 


Chairman Murphy, Ranking Member DeGette, and Members of the 

Subcommittee: 

I am pleased to be here today as you examine the personal care services 

benefit available under Medicaid, the federal-state health financing 

program for low-income and medically needy individuals. Medicaid is the 

nation's primary payer of long-term care services and supports for 

disabled and aged individuals who may need care for an extended period 

of time. Personal care services are a significant and important component 

of Medicaid's long-term care services and supports. Personal care 

services provide assistance to beneficiaries of all ages who have limited 

ability to care for themselves because of physical, developmental, or 

intellectual disabilities, helping them with activities of daily living such as 

bathing, dressing, and toileting. Such assistance can enable disabled and 

aged beneficiaries to remain in their homes, maintain their independence, 

and participate in community life to the fullest extent possible. 

Medicaid spending on long-term care services and supports is significant, 

representing more than one-quarter of Medicaid spending annually. The 

federal cost of Medicaid long-term care spending is expected to increase 

from $75 billion in 2015 to $111 billion in 2026. 1 Historically, Medicaid 

spending for long-term care has been largely for services provided in 

institutional settings, such as nursing homes. In recent years, this trend 

has changed and the majority of federal and state spending has shifted 

towards home- and community-based services (HCBS)-that is, services 

and assistance provided to beneficiaries in their homes or other settings 

integrated with their communities. 2 As a result of the aging of the nation's 

population and increased opportunities for aged and disabled individuals 

to live in their homes instead of institutions, the demand for and spending 

on HCBS and personal care services is expected to increase. 

Although personal care services are an important support for Medicaid 

beneficiaries, provision of these services is not without risk, both for 

beneficiary safety and for improper Medicaid payments. Beneficiaries 

receiving personal care services include aged individuals and individuals 

with physical, developmental, or intellectual disabilities, some of whom 

1

CongressJona! Budget Office, Detail of Spending and Enrollment for Medicaid for CBO's 

March 2016 Baseline (Washtngton, D.C .. 2016). 

2

See Truven Health Analytics, Medicaid Expenditures for Long~ Term Services and 

Supports in FY 2013 (June 30, 2015) 

Page 1 GA0·17·598T Medicaid Personal Care Services 
31 


can be vulnerable. Also, when personal care services are provided in a 

private home, other providers or community members may not be present 

to help discourage or report on questionable activities. These factors can 

result in some beneficiaries being at risk of unintentional harm and 

potential neglect and exploitation. A beneficiary's capacity to manage 

finances and secure possessions may decline with age, onset of 

dementia, or other cognitive disabilities, and put them at risk of theft or 

financial exploitation from unscrupulous attendants. 3 Moreover, 

depending on the particular state and Medicaid program, personal care 

attendants who provide services may not be required to have a credential 

from an organization that trains workers for certain qualifications. The 

provision of personal care services is also at high risk for Medicaid 

improper payments, including instances where services for which the 

state was billed were not provided. The Centers for Medicare & Medicaid 

Services (CMS), an agency within the U.S. Department of Health and 

Human Services (HHS), estimated that about 12 percent of all states' 

payments for personal care services in 2015 were improper-twice the 6 

percent error rate estimated for 2014-and that the projected dollar 

amount of payment errors was over $3.6 billion, up from $2 billion 

estimated for 20144 

3

GAO, Elder Justice: National Strategy Needed to Effectively Combat Elder Financial 

Exploitation, GA0-13-110 (Washington, D.C .. Nov. 15, 2012).1n addition, the HHS Office 

of Inspector General has issued reports that documented cases of beneficiary neglect 

See U.S. Department of Health and Human Services Office of Inspector Genera!, 

Investigative Advisory on Medicaid Fraud and Patient Harm lnvolvmg Personal Care 

Se!Vices, Memo to Vikki Wachino, Deputy Administrator and Director, Center for Medicaid 

and CHIP Serv1ces, Centers for Med1care & Medicaid Services (Washington, D.C.: Oct 3, 

2016). 

4

Centers for Medicare & Medicaid Services (CMS), Medicaid and CHfP 2015 Improper 

Payments Report, (\Nashington, D.C.: 2016). These figures represent spending on a fee~ 

for~service basis only and exclude claims paid as part of a managed care arrangement 

An improper payment is defmed by statute as any payment that should not have been 

made or that was made in an incorrect amount (including overpayments and 

underpayments) under statutory, contractual, administrative, or other legally applicable 

requirements. It includes any payment to an ineligible recipient, any payment for an 

ineligible good or service, any duplicate payment, payment for a good or service not 

received (except for such payments where authorized by law), and any payment that does 

not account for credit for applicable discounts. Improper Payments Elimination and 

Recovery Act of 2010, Pub. L. No. 111-204, § 2(e), 124 Stat 2224, 2227 (2010) (codified 

at 31 U.S. C.§ 3321 note). Additionally, Office of Management and Budget guidance 

1nstructs agencies to report as improper payments any payments for which insufficient or 

no documentation was found 

Page 2 GA0~17~598T Medicaid Personal Care Services 
32 


As the agency overseeing Medicaid at the federal level, CMS is 

responsible for overseeing state Medicaid programs, including protecting 

Medicaid fiscally from improper payments, ensuring that all beneficiaries 

are protected, and collecting data from states on Medicaid spending for 

services, and the types and volume of services provided, to carry out its 

oversight responsibilities. CMS also provides states with guidance on 

federal program requirements. Personal care services can be provided 

under many different authorities under Medicaid, and states have 

developed many different types of programs for delivering personal care 

and other home- and community-based services. In recent years, 

Congress has directed HHS to improve coordination of these programs, 

which could harmonize requirements-that is, implement a more 

consistent administration of policies and procedures. Specifically, in 2010 

Congress required HHS to take steps to improve the coordination among, 

and regulation of all, providers of home- and community-based services 

to achieve a more consistent administration of policies and procedures 

across programs. 5 

We issued a report in each of 2016 and 2017 examining the federal 

oversight of Medicaid personal care services provided by state Medicaid 

programs. 6 My remarks today are based primarily on these two reports 

and will focus on our assessment of: 

1. federal program requirements to ensure the safety of Medicaid 

beneficiaries receiving personal care services and to ensure that 

billed services are actually provided; and 

2. the extent CMS collects data that can be used to monitor the provision 

of and spending on personal care services by state Medicaid 

programs. 

My remarks on the federal program requirements to ensure the safety of 

Medicaid beneficiaries and to ensure that billed services are provided are 

based on our 2016 report. For that report, we reviewed applicable federal 

laws, regulations, and guidance, including state reporting requirements 

specific to Medicaid personal care services programs. We also reviewed 

5

Patient Protection and Affordable Care Act, Pub. L No. 111-148, § 2402(a), 124 Stat. 

119,301-302 (2010) 

6See GAO, Medicaid Personal Care Services: CMS Could Do More to Harmonize 

Requirements across Programs, GA0-17-28 (Washington, D.C .. Nov. 23, 2016) and 

GAO, Medicaid: CMS Needs Better Data to Monitor the Provision of and Spending on 

Personal Care Services, GA0-17-169 (Washmgton, D.C.: Jan. 12, 2017). 

Page 3 GA0-17..S98T Medicaid Personal Care Services 
33 


Background 

Medicaid Program 

personal care services programs in four states, selected to include 

variation in the types of such programs. In addition, we reviewed reports 

by CMS and HHS Office of the Inspector General relating to personal 

care services and interviewed CMS officials. My remarks on the data 

CMS collects on Medicaid personal care services are based on our 2017 

report. For that report, we analyzed data collected by CMS on personal 

care services provided to beneficiaries and on state Medicaid spending 

on those services. For services provided, we analyzed Medicaid provider 

claims and managed care encounter data for calendar year 2012-the 

most recent and complete data available at the time of our 2016 

analysis-for 35 states that had finalized 2012 datal For spending, we 

also analyzed Medicaid expenditure data for all 50 states and the District 

of Columbia for calendar years 2012 through 2015. 8 Additional 

information on our scopes and methodologies are included in the 2016 

and 2017 reports. 

We conducted the work on which this statement is based in accordance 

with generally accepted government auditing standards. Those standards 

require that we plan and perform the audit to obtain sufficient, appropriate 

evidence to provide a reasonable basis for our findings and conclusions 

based on our audit objectives. We believe that the evidence obtained 

provides a reasonable basis for our findings and conclusions based on 

our audit objectives. 

Medicaid is jointly financed by the federal government and the states, with 

the federal government matching most state Medicaid expenditures using 

7

Each state transmits digttal files with the claims and encounter data to CMS using the 

Medicaid Statistical Information System. This system is designed to provide CMS with a 

detailed, national database of Medicaid program information to support a broad range of 

program management functions, including health care research and evaluation, program 

utilization and spending forecasting, and analyses of poHcy alternatives. CMS developed a 

research-friendly data set called the Medicaid Analytic eXtract (MAX), which is a set of 

beneficiary-level data files derived from state-submitted MSIS claims data on Medicaid 

eligibility, service utilization, and payments. We used MAX data to analyze claims for 

personal care services because they are more reliable and consistent than states' 

quarterly MS!S reports. For purpose of this report we refer to MAX data as MSIS data 

because MAX is based on state MSIS data submissions. 

8States must submit their Medicaid expenditures quarterly to CMS using the web-based 

Medicaid Budget and Expenditure System. 

Page 4 GA0·17·598T Medicaid Personal Care Services 
34 


a statutory formula that determines a federal matching rate for each state. 

Medicaid is a significant component of federal and state budgets, with 

estimated total outlays of $576 billion in fiscal year 2016, of which $363 

billion is expected to be financed by the federal government and $213 

billion by the states. Medicaid served about 72 million individuals, on 

average, during fiscal year 2016. 9 

As a federal-state partnership, both the federal government and the 

states play important roles in ensuring that Medicaid is fiscally sustainable 

over time and effective in meeting the needs of the populations it serves. 

States administer their Medicaid programs within broad federal rules and 

according to individual state plans approved by CMS, the federal agency 

that oversees Medicaid. 

Federal matching funds are available to states for different types of 

payments that states make, including payments made directly to 

providers for services rendered under a fee-for-service model and 

payments made to managed care organizations: 

Under a fee-for-service delivery model, states make payments directly 

to providers; providers render services to beneficiaries and then 

submit claims to the state to receive payment. States review and 

process fee-for-service claims and pay providers based on stateestablished payment rates for the services provided. 

Under a managed care delivery model, states pay managed care 

organizations a set amount per beneficiary; providers render services 

to beneficiaries and then submit claims to the managed care 

organization to receive payment. Managed care plans are required to 

report to the states information on services utilized by Medicaid 

beneficiaries enrolled in their plans-information typically referred to 

as encounter data. 

Most states use both fee-for-service and managed care delivery models, 

although the number of beneficiaries served through managed care has 

grown in recent years. 

Federal law requires each state, under both fee-for-service and managed 

care delivery models, to operate a claims processing system to record 

9

Expenditure and enrollment data are from Department of Health and Human Services, 

Centers for Medicare & Medicaid Services, Office of the Actuary, 2016 Actuarial Report on 

the Fmanciaf Outlook for Medicaid (2017). 

Page 5 GA0-17 -598T Medicaid Personal Care Services 
35 


Long-Term Services and 

Supports, Home and 

Community Based 

Services, and Personal 

Care Services 

information about the services provided and report this information to 

CMS: 

Provider claims and managed care encounter data are required to 

include information about the service provided, including the general 

type of service; a procedure code that identifies the specific service 

provided; the location of the service; the date the service was 

provided; and information about the provider who rendered the 

service (e.g., provider identification number). 

Fee-for-service claims records must include the payment amount 

Federal law requires states to collect managed care encounter data, 

but actual payment amounts to individual providers are not required. 

Long-term services and supports financed by Medicaid are generally 

provided in two settings: institutional facilities, such as nursing homes and 

intermediate-care facilities for individuals with intellectual disabilities; and 

home and community settings, such as individuals' homes or assisted 

living facilities. Under Medicaid requirements governing the provision of 

services, states generally must provide institutional care to Medicaid 

beneficiaries, while HCBS coverage is generally an optional service. 

Medicaid spending on long-term services and supports provided in home 

and community settings has increased dramatically over time-to about 

$80 billion in federal and state expenditures in 2014-while the share of 

spending for care in institutions has declined, and HCBS spending now 

exceeds long-term care spending for individuals in institutions (see fig. 

1). 10 All 50 states and the District of Columbia provide long-term care 

HCBS and institutional long-term care spending is roughly equal for services 

provided on a fee-for-service basis. However, when long-term care services provided 

under a managed care arrangement are included, HCBS spending exceeds institutional 

spending. Truven Health Analytics, under contract with CMS, reported that 2013 was the 

first instance of expenditures for HCBS exceeding institutional services as a percentage of 

all long~ term care services-51 percent for HCBS compared to 49 percent for institutional 

services. See Truven Health Ana!ytics. Medicaid Expenditures for Long-Term SeNices 

and Supports 

PageS GA0-17*598T Medicaid Personal Care Services 
36 


services to some Medicaid beneficiaries in home and community 

settings. 11 

Ftgure 1: Percentage of Spending and Total Spending on Medicaid Long~Term Services and Supports for lnstltutional Care 

and Home~ and Community-Based Services, Fiscal Years 1994 thro-ugh 2014 

Percentage Dollars ln bllfions 

100 160 

•• 

•• 

40 

20 

o-------------------------------- 1994 2004 

Fiscal year 

--Home and community·based services 

InstitUtional care 

2014 

Fiscal year 

Home~ and community-based services 

Personal care services, a key type of HCBS, are typically nonmedical 

services provided by personal care attendants-home-care workers who 

or may not have specialized training. The demand for personal care 

is expected to increase as is the number of attendants providing 

Page 7 GA0~17~598T Medicaid Personal Care Services 
37 


these services in coming years." The number of Medicaid beneficiaries 

receiving personal care services at this time is not known, but likely in the 

millions. In calendar year 2012, the most recent and complete available 

data, an estimated 1.5 million beneficiaries in the 35 states reporting at 

the time received personal care services at least once. 13 Total Medicaid 

spending for personal care services is also not known, as spending in 

managed care delivery systems is not reported by service. Total Medicaid 

spending for personal care services in fee-for-service delivery systems 

was about $15 billion in FY 2015. 

Types of Personal Care 

Services Programs 

With approval from CMS, states can choose to provide personal care 

services under one or more types of authorities (referred to in this 

statement as programs) put in place over the past 41 years under 

different sections of the Social Security Act The various types of 

programs provide states with options for permitting participant direction 

and choices about how to limit services, among other things (see table 1). 

Table 1: Types of Programs under Which States Can Provide Medicaid Personal Care Services 

Program name 

(Year) 

State Plan Personal Care 

Services 

(Implemented in 1975) 

Number of states 

administering 

personal care services through 

program 

25 

Authorizing statute and program description 

Starting in 1975, states have had the option of offering personal care services 

as a Medicaid State plan benefit In its present form, section 1905(a)(24) of the 

Socia! Security Act, enacted in 1993, authorizes states to provide personal care 

services as a covered service in their state Medicaid plans. State Plan personal 

care services can serve beneficiaries who need an Institutional level of care or 

those who do not need an institutional level of care. States must provide 

an eligible beneficiaries and cannot limit the number covered or use 

120veral!, the number of personal care attendants employed is projected to increase by 26 

percent from 2014 to 2024, growing from 1,768,400 in 2014 to 2,226,500 in 2024. The 26 

percent rate of growth is much faster than the projected national average for all 

occupations of 7 percent See U.S. Department of Labor, Bureau of Labor Statistics, 

Occupational Outlook Handbook, 2016-17 Edition (2016) 

13See GA0-17-169 

Page a GA0~17~598T Medicaid Personal Care Services 
38 


Program name 

{Year) 

Home- and CommunityBased Services (HCBS) 

Waiver 

{Enacted in 1981) 

. State Plan HCBS 

{Enacted in 2006) 

Participant-Directed 

Option 

{Enacted in 2006) 

Comfnunity First Choice 

{Enacted in 2010) 

Number of states 

administering 

personal care 

services through 

program 

48 

Authorizing statute and program description 

Section 1915{c} of the Social Security Act authorizes states to seek waivers of 

certain traditional Medicaid requirements in order to provide HCBS, including 

personal care services. For example, the Secretary of HHS can waive the 

requirement that the state provide services statewide to eligible beneficiaries. 

States can choose to provide any of a specified range of services to eligible 

beneficiaries including personal care services, case management, habilitation, 

and respite care.a Only beneficiaries who need an institutional level of care are 

eligible. CMS can waive certain federal requirements, allowing states to target 

services to specific groups and limit the number of beneficiaries served 

Section 1915(i} of the Social Security Act authorizes states to provide any of the 

same range of services as available under HCBS Waivers, including personal 

care services. Unlike HCBS Waiver programs, states have the option to cover 

beneficianes who need an institutional level of care, but must provide services 

to beneficiaries who do not require an institutional level of care. States can 

target services to specific groups of beneficiaries but may not limit access to 

services based upon the cost of services or the income or location of eligible 

beneficiaries. 

Section 1915(j) of the Social Security Act gives states additional options for the 

delivery of personal care serv1ces and other services. The Participant-Directed 

Option is not a stand-alone program but, instead, must be offered in conjunction 

with either State Plan personal care services or HCBS Waiver. States can offer 

beneficiaries the option to receive individual budgets to pay for personal care 

services and other services. Beneficiaries may also be permitted to compensate 

a legally liable relative, such as a spouse or a parent, for personal care 

services. States are permitted to limit the number of beneficiaries served and to 

target services to specific groups. Beneficiaries can be eligible for an 

institutional level of care or not. 

Sect1on 1915{k) of the Social Security Act authorizes states to provide personal 

care serv1ces and a range of services. States must provide services to all 

beneficiaries who are eligible. Only beneficiaries who would otheJWise need an 

institutional level of care are eligible_ States receive a 6 percentage point 

enhanced federal match for all services provided under Community First Choice 

programs 

Source Sooal Secun\y Act. Tille XIX and CMS I GAO-17 -598T 

"The number o! states With a Commumty F~rst Cho1ce program IS cu!Tent as of September 2016 

CMS has implemented the different statutory requirements associated 

with these various program types by issuing regulations, as well as 

guidance to help states implement their Medicaid programs in accordance 

with applicable statutory and regulatory requirements. Guidance can 

include letters to state Medicaid directors, program manuals, and 

templates to help states apply for CMS approval to provide certain 

services like personal care. Together with federal statutes, the regulations 

Page 9 GA0-17-598T Medicaid Personal Care Services 
39 


Federal Program 

Requirements for 

Maintaining 

Beneficiary Safety 

and Ensuring That 

Billed Services Are 

Provided Differ 

Significantly 

and guidance issued by CMS establish a broad federal framework for the 

provision of personal care services. States are responsible for 

establishing and administering specific policies and programs within the 

federal parameters laid out in this framework. 

In our 2016 report examining the federal program requirements for the 

multiple programs under which personal care services are provided, we 

found significant differences in federal requirements related to beneficiary 

safety and ensuring that billed services are provided. 14 These differences 

may translate to differences in beneficiary protections across program 

types. Program requirements can include general safeguards for ensuring 

beneficiary health and welfare, quality assurance measures, critical 

incident monitoring, and attendant screening. For example, states 

implementing an HCBS Waiver program or a State Plan HCBS program 

must: 

Describe to CMS how the state Medicaid agency will determine that it 

is assuring the health and welfare of beneficiaries. To do so, states 

must describe: the activities or processes related to assessing or 

evaluating the program; which entity will conduct the activities; the 

entity responsible for reviewing the results of critical incident 

investigations; and the frequency at which activities are conducted. 

Demonstrate to CMS, by providing specific details that an incident 

management system is in place, including incident reporting 

requirements that establish the type of incidents that must be 

reported, who must report incidents, and the timeframe for reporting. 

In contrast, states implementing a State Plan personal care services 

program or a Community First Choice program have fewer requirements 

for beneficiary safeguards. For example, for these programs, states are 

not required to do the following: 

Provide CMS with detailed information describing the activities they 

are taking to assure the health and welfare of beneficiaries. 

14For purposes of this analysis, we reviewed regulations specific to personal care 

services, which appear at 42 CFR. Parts G, J, K, and M, as well as any personal care 

service-specific guidance issued by CMS. We did not review regulations or guidance of 

general applicability, such as program integrity requirements set forth in 42 C.F.R. part 

455, because changes to these requirements would affect services beyond those provided 

under personal care services programs. 

Page 10 GA0·17·598T Medicaid Personal Care Services 
40 


Demonstrate to CMS specific details about !heir critical incident 

management process and incident reporting system; instead they are 

required to describe more generally their "process for the mandatory 

reporting, and resolution of allegations of neglect, abuse, 

or exploitation. 

Table 2 below illustrates more broadly the differences in federal program 

requirements that establish beneficiary safeguards and protections that 

we identified in our 2016 report. 

Table 2: Federal Medicaid Personal Care ~rviees Program Requirements on Safeguarding Beneficiaries, by Program Type1 

as of November 2016 

15See. for example, 42 C.F.R § 441585(a)(2) (2016). 

Page 11 GA0~17~S9ST Medicaid Personal Care Services 
41 


Community HCBS Woivers First Choice 

• • 

0 "' 

"' o' 

Source GAO an<~IY$1S ol Section XIX of the Sooml Securr!y Act. Personal Care Semces RegiA allons: CMS gwdar!Ce! GAO-i7-598T 

dStates must report on beneficiaries' "physical and emotiOnal health." 

Differences in federal program requirements may also result in significant 

differences in the level of assurance that billed services are actually 

provided to beneficiaries. States implementing HCBS Waiver programs 

and State Plan HCBS programs, for example, are required by CMS to 

provide evidence that the stale is only paying claims when services are 

Page 12 GA0~17~598T Medicaid Pe-rsonal Care Services 
42 


actually rendered, while the State Plan personal care services and 

Community First Choice programs are not required to do so. 

Table 3 below highlights the federal Medicaid personal care services 

program requirements that we identified in our 2016 report to ensure that 

billed services are provided for each of the different type of HCBS 

program states may administer. 

Table 3: Federal Medicaid Personal Care Services Program Requirements on Ensuring Billed Services Are Provided, by 

Program Type, as of November 2016 

Personal Care Services Program Type a 

State Plan 

Home-and 

Community~ 

State Plan Based 

Requirements for states on ensuring that billed 

services are providedb 

personal care Services HCBS Community 

services (HCBS) Waivers First Choice 

Assure financial accountabt!ity and submit to an 0 • • 0 independent financtal audit 

Provide evidence that cla1ms are only for serv1ces 0 • • 0 rendered 

Describe the processes to validate provider bi!!ings to 0 • • 0 help ensure that services were provided 

Monitor service delivery for participant-directed services • • • 0 

Legend. • - Requ1red o - Not required 

Source GAO analySis of Secl>on XIX of the Social Secunty Act. Personal Care SeiVIces RegulaMns, CMS gutdance I GA0-17-598T 

aone other type of personal care services program is called the Participant-Directed Option. It is not a 

standalone program; instead, states pair it with either State Plan persona! care services or HCBS 

Waivers. The requirements of the underlying paired authority apply to programs offering the 

Participant-Directed Option. 

bFor purposes of this analysis, we reviewed regulations specific to personal care services, which 

appear at 42 C.F.R. Parts G, J. K. and M, as well as any personal care service-spec!fic guidance 

issued by CMS. We did not review regulations or guidance of general applicability, such as Medicaid 

program integrity requirements set forth in 42 C.F.R. part 455, because changes to these 

requirements would affect services beyond those provided under personal care services programs. 

The four selected states we examined as part of our 2016 report used 

different methods to ensure attendants provided billed services to 

beneficiaries, according to state officials. For example, for at least some 

personal care services programs, two states required beneficiaries to sign 

timesheets, and two states used electronic visit verification timekeeping 

Page13 GA0~17~598T Medicaid Personal Care Services 
43 


systems. 16 All four states performed quality assurance reviews for some 

personal care services programs to ensure billed services are received. 17 

The differing federal program requirements can create complexities for 

states and others in understanding federal requirements governing 

different types of HCBS programs, including personal care services. 

These different requirements may also result in significant differences in 

beneficiary safeguards and fiscal oversight, as illustrated in the following 

examples: 

Beneficiaries may experience different health and welfare safeguards 

depending on the program in which they are enrolled. For example, in 

one state we reviewed in 2016, the state required quarterly or 

biannual monitoring of beneficiaries for most of its personal care 

services programs. In contrast, for another program, the state 

required only annual monitoring contacts, in part, officials told us, due 

to the differing program requirements. 18 Depending on the program 

type, CMS may have fewer assurances that beneficiaries' with similar 

levels of need are in programs with similar protections. For example, 

three of the four states we reviewed-Maryland, Oregon, and Texashave in recent years transitioned coverage of personal care services 

16Eiectronic visrt venfication timekeeping systems are newer. technology-based systems 

that electronrcally record when attendants begin and end providing services to a 

beneficiary. Such systems may include features to venfy the attendant's location and 

make sure the attendant is in the beneficiary's home. 

17 State quahty assurance procedures help assure state Medicaid persona! care services 

programs are meeting quality standards and are to be implemented in compliance with 

federal and state program requirements. States design their own quality assurance 

procedures in accordance with federal Medicaid personal care service requirements, 

which vary by Medicaid persona! care services program and are subject to approval by 

CMS. In general, quality assurance procedures across the four states we reviewed include 

monitoring such as case f1le or record reviews and inwhome visits to make sure required 

procedures were followed 

18Federa! internal control standards state that agencies should establish control activities 

that appropriately cover the objectives and risks of an entity's operations. See GAO, 

Standards for Internal Controls in the Federal Government, GA0-14~704G (Washington, 

D.C.: Sept. 2014). Internal control is a process effected by an entity's oversight body, 

management. and other personnel that provides reasonable assurance that the objectives 

of an entity will be achieved. In the case of personal care services, a risk-based internal 

control process would suggest that programs protecting Medicaid beneficiaries from harm 

and ensuring that payments are made only made when services are actually provided are 

comparable across programs serving like beneficiaries. A consistent process and 

comprehensive framework for managing risk can help ensure risks are managed 

effectively, efficiently, and coherently 

Page 14 GAOw17-598T Medicaid Personal Care Services 
44 


for beneficiaries who need an institutional level of care from personal 

care services programs with relatively more stringent federal 

beneficiary safety requirements to programs with relatively less 

stringent requirements. Although they were not required to do so, 

state officials in the three states reported that the states chose to 

continue using the same quality assurance measures in the new 

programs as the best way to ensure safety for beneficiaries. Without 

more harmonized requirements, we concluded that CMS has no 

assurance that states that transition personal care services from 

HCBS Waivers to Community First Choice in the future will make the 

same decisions. 

States can use different processes for each personal care services 

program to ensure that billed services are actually provided, and 

some programs may not be subject to federal personal care services 

requirements explicitly in this regard. For example, in one state we 

reviewed in 2016, steps taken to ensure billed services are provided 

under some types of personal care services programs were not 

required in another of the state's programs. 19 

A report we issued in 2012 reviewing states' implementation of different 

HCBS programs also suggested that states could benefit from more 

harmonization of program requirements. Officials in selected states we 

reviewed in 2012 noted the complexity of operating multiple programs. 20 

For example, officials from one state reported that the complexity resulted 

in a siloed approach, with different enrollment, oversight, and reporting 

requirements for each program. The administration and understanding of 

the programs available to beneficiaries was difficult for state staff and 

beneficiaries, according to officials in another state. The officials indicated 

that they would prefer CMS issue guidance on how states could operate 

different HCBS program types together, rather than issuing guidance on 

each program separately. 

In our 2016 report, we acknowledged certain efforts CMS had taken to 

harmonize requirements and improve oversight of personal care services 

programs. However, despite these efforts, we found that significant 

19rhe state reported that tn one personal care services program, a supervisor must visit 

the beneficiary and document whether the attendant is delivering the authorized personal 

care services tasks. The state did not apply the same process to another of its personal 

care services programs for which there was no specific requirement in this regard. 

20GAO, Medicaid.- States' Plans to Pursue New and Revised Options for Home- and 

Community-Based SeNices, GA0-12-649 (Washington, D.C.: June 13, 2012). 

Page 15 GA0-17-598T Medicaid Personal Care Services 
45 


Data on Personal 

Care Services 

Collected by CMS 

were Often Not 

Timely, Complete, 

Consistent, or 

Accurate 

Claims and Encounter 

Data Were Not Timely, 

Complete, or Consistent 

differences in program requirements existed. We recommended that CMS 

take additional steps to better harmonize and achieve a more consistent 

application of program requirements, as appropriate, across the different 

personal care services programs in a way that accounts for common risks 

faced by beneficiaries and to better ensure billed services were provided. 

CMS agreed with these recommendations, and has sought input by 

publishing a request for information on numerous topics related to 

Medicaid home and community-based services, including input on how to 

ensure beneficiary health and safety and program integrity across 

different types of personal care services programs. 

In our 2017 report examining the data CMS uses to monitor the provision 

of personal care services, we found that claims and encounter data 

collected by CMS were not timely. Data are typically not available for 

analysis and reporting by CMS or others for several years after services 

are provided. We found that this happens for two reasons. First, although 

states have 6 weeks following the completion of a quarter to report their 

claims data, their reporting could be delayed as a result of providers and 

managed care plans not submitting data in a timely manner, according to 

the CMS contractor responsible for compiling data files of Medicaid 

claims and encounters. For example, providers may submit claims for 

fee-for-service payments to the state late and providers may need to 

resubmit claims to make adjustments or corrections before they can be 

paid by the state. Second, once complete MSIS data are submitted by the 

states, the data must be compiled into annual person-level claims files 

that are in an accessible format, checked to identify and correct data 

errors, and consolidated for any claims with multiple records. This 

process, for one year of data, can take several years and, as a result, 

when information from claims and encounters becomes available for use 

Page 16 GA0~17*598T Medicaid Personal Care Services 
46 


by CMS for purposes of program management and oversight it could be 

several years old. 

We also found that Medicaid personal care services claims and encounter 

data that CMS collects were incomplete in two ways. First, specific data 

on beneficiaries' care services were not included in the calendar 

year 2012 MSIS for 16 states, as of 2016, when we conducted our 

analysis. Nevertheless, these 16 stales received federal matching funds 

for the $4.2 billion in total fee-for·service payments for personal care 

services that year-about 33 percent of total expenditures for personal 

care services reported by all states (see figure 2). 21 

Figure 2; Percentag$ of Catendar Year 2012 Persona} Care Services Fee~For~S:ervice 

Expenditures for States That Were and Were Not Included in the Medicaid 

Statlstlcallnformation System Data 

Percentage ; Oo!law ln billions 

' 10 

' 

'. 

'2 

' ' 

MSIS elalms Parson a! care: servJc(!,s expendl:tures 

16 states not !nchJded - 35 states included 

Page 17 GA0~17~598T Medicaid Personal Care Services 
47 


Second, even for the 35 stales for which 2012 MSIS claims and 

encounter data were available, certain data elements collected by CMS 

were incomplete. For example, for the records we analyzed, 20 percent 

included no payment information, 15 percent included no provider 

identification number to identify the provider of service, and 34 percent 

did not identify the quantity of services provided (see figure 3) 22 

Figure 3; Percentage of 2612 Medicaid Claims and Encounters for Personal Care 

Services in 35 States That Had Complete Information on Payment1 Provider 

tnformation, and the Quantity of Services Provlded 

so 100 

Percentage 

Page 18 GA0"17~59ST Medieald Personal Care Services 
48 


Incomplete data limit CMS's ability to track spending changes and 

corroborate spending with reported expenditures because the agency 

lacked important information on a significant amount of Medicaid 

payments for personal care services. For example, among the 2012 

claims we reviewed for personal care services under a fee-for-service 

delivery model, claims without a provider identification number accounted 

for about $4.9 billion in total payments. Similarly, payments for fee-forservice claims with missing information on the quantity of personal care 

services provided totaled about $5.1 billion. These data gaps represented 

a significant share of total personal care services spending, which totaled 

about $15 billion in fee-for-service expenditures in 2015. 

Even when states' claims and encounter data collected by CMS was 

complete, we found that it was often inconsistent, which limits the 

effectiveness of the data to identify questionable claims and encounters. 

For purposes of oversight, a complete record (claims or encounters) 

should include data for each visit with a provider or caregiver, with dates 

of when services were provided, the amount of services provided using a 

clearly specified unit of service (e.g., 15 minutes), and the type of 

services provided using a standard definition. Such a complete record 

would allow CMS and states to analyze claims to identify potential fraud 

and abuse. The following examples illustrate inconsistencies in data 

regarding when services were provided and the types of services that 

were provided from the 35 states whose data we reviewed: 

When services were provided. State-reported dates of service were 

overly broad. In the 35 states, some claims for personal care services 

had dates of services (i.e., start and end dates) that spanned multiple 

days, weeks, and in some cases months. For 12 of the 35 states. 95 

percent of their claims were billed for a single day of service. 

However, in other states, a number of claims were billed over longer 

time periods. For example, for 10 of the states, 5 percent of claims 

covered a period of at least 1 month, and 9 states submitted claims 

that covered 100 or more days. When states report dates of service 

that are imprecise, it is difficult to determine the specific date for which 

services were provided and identify whether services were claimed 

during a period when the beneficiary is not eligible to receive personal 

care services-for example, when hospitalized for acute care 

services. 

Type of services provided. States used hundreds of different 

procedure codes for personal care services. Procedure codes on 

submitted claims and encounters were inconsistent in three ways: the 

number of codes used by states; the use of both national and statePage 19 GA0~17«598T Medicaid Personal Care Services 
49 


Medicaid Expenditure 

Data Collected by CMS 

Were Not Always Accurate 

or Complete 

specific codes: and the varying definitions of different codes across 

states. More than 400 unique procedure codes were used by the 35 

states. CMS does not require that states use standard procedure 

codes for personal care services; instead, states have the discretion 

to use state-based procedure codes of their own choosing or national 

procedure codes. As a result, the procedure codes used for similar 

services differed from state to state, which limits CMS's ability to use 

this data as a tool to compare and track changes in the use of specific 

personal care services provided to beneficiaries because CMS cannot 

easily compare similar procedures by comparing service procedure 

codes. 

In our 2017 report we found that Medicaid personal care services 

expenditure data collected were not always accurate or complete, 

according to our analysis of expenditure data collected by CMS from 

states for calendar years 2012 through 2015. When submitting 

expenditure data, CMS requires states to report expenditures for personal 

care services on specific reporting lines. These reporting lines correspond 

with the specific types of programs under which states have received 

authority to cover personal care services, and can affect the federal 

matching payment amounts states receive when seeking federal 

reimbursement. For example, a 6 percent increase in federal matching is 

available for services provided through the Community First Choice 

program." For three other types of HCBS programs, CMS also requires 

states to report their expenditures for personal care services separately 

from other types of services provided under each program on what CMS 

refers to as feeder forms-that is, individual expenditure lines for different 

types of services that feed into the total HCBS spending amount for each 

program. 

We found that not all states were reporting their personal care services 

expenditures accurately, and, as result, personal care services 

expenditures may have been underreported or reported in an incorrect 

category. We compared personal care services expenditures for all states 

for calendar years 2012 through 2015 with each state's approved 

programs during this time period and found that about 17 percent of 

personal care services expenditure lines were not reported correctly. As 

23 1n add1t1on to the 6 percent enhanced federal matching rate, states operating a 

Community First Choice program are subject to a maintenance of expenditures 

requirement-that is, states operating such a program are required in their first year to 

maintain or exceed the level of spending from the prior year 

Page 20 GA0-17-598T Medicaid Personal Care Services 
50 


illustrated in figure 4, two4hirds of the reporting errors were a 

result of states not identifying and reporting personal care 

services expenditures using correct reporting lines, as required by 

CMS, Without separate reporting of personal care expenditures as 

required, CMS is unable to ensure appropriate federal payment, monitor 

how spending changes over time across the different program types and 

have an accurate estimate of the magnitude of potential improper 

payments for personal care services, The other types of errors involved 

states erroneously reporting expenditures that did not correspond with 

programs, As a result, CMS is not able to efficiently and 

identify and stales from receiving federal matching 

funds inappropriately, part because it does not have accurate fee-forservice claims data thai track payments by personal care program type 

that is linked with expenditures reported for purpose of federal 

reimbursement 

Figure 4: Percentage of PerSonal Care Services Expenditure Lines in 201:2 to 2015 

with State Reporting Errors 

Efrors due to reporttl"1g expenditl.!res inoonsJslent wl!h approved persona! care services programs> 

Source: GAO analysis of Centers for Medicate & MOOicaid Services data. 1 GA0-17+5'9ST 

Pag~ 21 GA0·17~598T Medicaid Personal Care Services 
51 


These errors demonstrated that CMS was not effectively ensuring its 

reporting requirements for personal care expenditures were met We 

concluded that by not ensuring that states are accurately reporting 

expenditures for personal care services, CMS is unable to accurately 

identify total expenditures for personal care services, expenditures by 

program, and changes over time. According to CMS, expenditures that 

states reported through MBES are subject to a variance analysis, which 

identifies significant changes in reported expenditures from year to year. 

However, CMS's variance analysis did not identify any of the reporting 

errors that we found. CMS officials told us that they would continue to 

review states' quarterly expenditure reports for significant variances and 

follow up on such variances. 

In our 2017 report, we acknowledged certain efforts CMS had taken to 

improve the data it collects. However, these efforts had not addressed 

data issues we identified that limited the usefulness of the data for 

oversight We recommended that CMS take steps to improve the 

collection of complete and consistent personal care services data and 

better monitor the states' provision of and spending on Medicaid personal 

care services. Specifically, CMS agreed with recommendations to better 

ensure states comply with data reporting requirements and to develop 

plans for analyzing and using the data. The agency neither agreed nor 

disagreed with recommendations to issue guidance to ensure key data 

regarding claims and encounter data are complete and consistent, or with 

a recommendation to ensure claims data can be accurately linked with 

aggregate expenditure data. In light of our findings of inconsistent and 

incomplete reporting of claims and encounters, errors in reporting 

expenditures, and the high-risk of improper payments, we believe action 

in response to these recommendations is needed. 

In conclusion, Medicaid personal care services are an important benefit 

for a significant number of Medicaid beneficiaries and amount to billions 

of dollars in spending to the federal government and states. The demand 

and spending for personal care services continues to grow. However, the 

services are not without risk. Personal care services are at high risk for 

improper payments and beneficiaries may be vulnerable and at risk of 

unintentional harm and potential neglect and exploitation. Over the years, 

federal laws have given states a number of different options to provide 

home- and community- based services. Having various options for 

providing personal care services provides flexibilities for states in how 

they administer their programs and provide services to different groups of 

beneficiaries. At the same time, our work has also found a patchwork of 

Page 22 GA0~17*598T Medicaid Personal Care Services 
52 


GAO Contact and 

Staff 

Acknowledgments 

(102019) 

federal requirements, resulting in varying levels of beneficiary safeguards 

and requirements to ensure that billed services are actually provided. As 

a result, beneficiaries with similar needs could be receiving services in 

programs with significantly different safeguards in place, depending on 

the program. Similarly, the level of assurance that billed services are 

actually provided could vary based on the type of program. Further, our 

work showed that the data CMS collects for oversight of these programs 

is not always timely, complete, accurate, and consistent. Without better 

data, CMS is hindered in effectively performing key management 

functions related to personal care services, such as ensuring state claims 

for enhanced federal matching funds are accurate. CMS has taken steps 

to improve the data it collects from states, and to establish more 

consistent administration of policies and procedures across the programs 

under which personal care services are provided. However, we found 

additional steps are warranted. 

Chairman Murphy, Ranking Member DeGette, and Members of the 

Subcommittee this concludes my prepared statement. I would be pleased 

to respond to any question that you might have at this time. 

If you or your staffs have any questions about this testimony, please 

contact Katherine M. lritani at (202) 512-7114. Contact points for our 

Offices of Congressional Relations and Public Affairs may be found on 

the last page of this statement. Individuals making key contributions to 

this testimony include Tim Bushfield, Assistant Director; Anna Bonelli; 

Christine Davis; Barbara Hansen; Laurie Pachter; Perry Parsons; and 

Jennifer Whitworth. 

Page 23 GA0~17-598T Medicaid Personal Care Services 
53 


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55 

Mr. MURPHY. Thank you, Ms. Iritani. 

Mr. Hill, you’re recognized for 5 minutes. 

STATEMENT OF TIM HILL 

Mr. HILL. Thank you. Good morning, Chairman Murphy, Ranking Member DeGette, and members of the subcommittee. Thank 

you for the invitation and the opportunity to discuss personal care 

services in Medicaid. 

Speaking as a career executive with over 25 years of experience 

to Medicare and Medicaid service, to Medicare and Medicaid beneficiaries, I can state with confidence that CMS shares your commitment to protecting beneficiaries and ensuring the taxpayer dollars 

are spent on legitimate items and services. This fiduciary commitment is the forefront of all of our activities. In that regard, we 

greatly appreciate the ongoing work done by the IG and the GAO 

to highlight potential vulnerabilities in these important programs 

and we rely on their recommendations to inform our program improvement activities across all our programs. 

As you know, States are primarily responsible for day-to-day operation of the Medicaid program and for designing programs that 

best serve the needs of the beneficiaries in any particular State. 

While we at CMS have an important role to play in terms of providing overall guidance and direction, States are in charge of administering the Medicaid programs and have significant flexibility 

to choose options that enable them to deliver high quality, cost effective care for their residents. 

Perhaps nowhere in the Medicaid program is that flexibility more 

important than in designing and administering home and community-based service programs including the provision of personal 

care services. Personal care services provide vital, person-centered 

care that allows individuals to remain in their homes or community 

instead of a nursing facility or other institution. In Medicaid, coverage of these important services is generally optional for States. 

However, because States see the value in these services, nearly all 

50 States provide some level of coverage. 

It’s hard to overstate the ways in which maintaining home and 

community based service programs benefits both the communities 

and the beneficiaries they serve. These programs cost less for both 

States and beneficiaries. They empower patients to have more control over their daily lives and the management of their health and 

they provide essential and culturally appropriate support to patients and their families. 

It’s precisely because of the importance of these programs to 

Medicaid that it’s paramount that we do all we can to protect these 

programs from fraud, waste, and abuse. Not solely to protect 

against financial losses, but as we’ve heard this morning, but more 

importantly to protect against abuse or neglect of vulnerable beneficiaries, many of whom are elderly or individuals with disabilities 

and may have no other practical alternative to institutionalization. 

Even one case of fraud, abuse or neglect is too many. In our efforts to protect these programs and the beneficiaries they serve, we 

pursue a balanced approach that recognizes the unique needs of 

every State while preserving their flexibility to design programs 

56 

that will best serve their residents, while at the same time analyzing when and where to use national standards or guidance. 

We take a number of actions and we’ll continue to help States 

safeguard their Medicaid beneficiaries and program resources by 

providing them with the tools they need to be successful. For example, to help States better understand requirements and share best 

practices, we publish guidance that highlights suggested approaches to strengthening and stabilizing the Medicaid home care 

workforce and other options to strengthen program integrity in 

Medicaid Personal Care Services programs. 

We’ve provided training for State officials and other stakeholders 

creating space for them to collaborate, share best practices, while 

staff is simultaneously staying up to date on emerging program 

vulnerabilities. 

CMS also uses focused program integrity reviews, assessing 

State program integrity effectiveness related to their administration of personal care services, providing States with feedback on 

vulnerabilities and possible corrective actions. 

This year, we plan to conduct focused reviews on PCS in five additional States. 

We also use our Medicaid Integrity Resources to work collaborative with States to identify improper payments through review of 

claims. Using these resources, we’ve conducted over 40 audits on 

personal care services in 8 States. In one recent audit of PCS services in one State resulted in over $500,000 being returned to the 

Treasury. 

Even as we continue to work with States to help them implement 

their programs, we are interested in understanding what changes 

need to be made at the Federal level. That is why last November, 

we published a request for information to gather stakeholder feedback on a provision of HCBS services. We are particularly interested in the benefits and consequences of implementing standard 

Federal requirements for personal care services and what these 

standards could include and how they could be developed. 

We’re reviewing the comments we received to inform our approach to supporting States and their program integrity efforts in 

a way that maximizes State flexibility while protecting personal 

care service programs and beneficiaries from fraud, waste, and 

abuse. 

As we continue our efforts for PCS, we must also work to ensure 

that any additional oversight requirements do not create administrative burden, increase costs or impact beneficiary choice or control. The successful delivery of PCS in Medicaid ensure that both 

individual needs and preferences are met and that the program has 

adequate safeguards in place. 

We look forward to continuing our work with States, our oversight partners, and other stakeholders. This concludes my statement. I’m happy to take any questions. 

[The prepared statement of Mr. Hill follows:] 

57 


TIM HILL, 

CENTER FOR MEDICAID AND 

ON 

COMBA;tt'ING \VASTE, FRAUD, AND ABUS 

MAY2,20l7 
58 


U.S. House Energy and Commerce Committee, 

Subcommittee on Oversight and Investigations 

Combating Waste, Fraud, and Abuse in Medicaid's Personal Care Services Program 

May 2, 2017 

Chairman Murphy, Ranking Member DeGette, and members of the Subcommittee, thank you for 

the invitation and the opportunity to discuss personal care services (PCS) in Medicaid. We share 

this Subcommittee's commitment to protecting beneficiaries and ensuring taxpayer dollars are 

spent on legitimate items and services, both of which are at the forefront of our program integrity 

mission. Because Medicaid is jointly funded by States and the Federal government and is 

administered by States within Federal guidelines, both the Federal government and States have 

key roles as stewards of the program, and CMS and States work together closely to carry out 

these responsibilities. Under the Medicaid Federal-State partnership, the Federal government sets 

forth a policy framework for the program and States have significant flexibility to choose options 

that enable them to deliver high quality, cost-efficient care for their residents. 

PCS arc one example ofl-lome- and Community-Based Services (HCBS), types of personcentered care delivered in the home and community and can include a variety of health and 

human services. HCBS, including PCS, can be a critical component in helping beneficiaries 

maintain as much independence as possible in their homes by providing assistance with basic 

Activities of Daily Living (ADL), such as bathing or dressing, and Instrumental Activities of 

Daily Living (IADL) such as meal preparation and money management. This allows 

beneficiaries to remain in the community rather than in a nursing facility or other institution. 

Creating and maintaining a Medicaid HCI3S program benefits the community and the individuals 

served in many ways; these programs are usually less than half the cost of residential care, 

empower patients to have more control over their daily lives and management of their health, and 

provide essential and culturally appropriate support to patients and their families. 1 

CMS takes the oversight of State PCS programs seriously, and the health and well-being of 

Medicaid beneficiaries are a top CMS priority. Without PCS, many beneficiaries who are elderly 

and individuals with disabilities may have no practical alternative to institutionalization. Program 

1 https:ilwww.cms.gov/Outreach-and-Education/ American-Indian-Alaska-Native/ AI A NIL TSS-T ACenterlinfoihcbs.html 
59 


integrity weaknesses in PCS put vulnerable beneficiaries at risk of substandard or harmful care 

and put program funds at risk for fraud, waste, and abuse. 

We appreciate the ongoing work done by the Department of Health and Human Services Office 

of Inspector General (OIG) and the Government Accountability Office (GAO) to highlight 

potential program integrity vulnerabilities and provide recommendations on strengthening 

safeguards. CMS relics on these recommendations to inform our program improvement activities 

across our programs, including PCS. W c have taken action to address a number of the 

recommendations made by OJG and GAO, and we will continue to identify and take additional 

steps to enhance safety and quality of services provided to Medicaid beneficiaries while 

maintaining the flexibility States need to design Medicaid programs that best meet the unique 

needs of their residents. 

Supporting Independence through Home- and Community-Based Services (HCBS) and 

Personal Care Services (PCS) 

Home- and Community-Based Services (HCBS), including PCS, are types of person-centered 

care delivered in the home and community and can include a variety of health and human 

services. HCBS programs address the needs of people with functional limitations who need 

assistance with everyday activities, like getting dressed or bathing, and are designed to enable 

people to stay in their homes and community, rather than moving to a facility for care. HCBS 

programs are often funded by State-requested waivers. Waiver programs are part of a State's 

Medicaid program, but they provide a special group of services to certain populations. Waiver 

programs usually have medical and financial eligibility requirements, but eligibility for waiver 

services may not be exactly the same as the eligibility rules for other Medicaid eligibility groups. 

Coverage of PCS is optional for States, except when they are medically necessary for children 

under the age of 21 eligible for early and periodic screening, diagnostic, and treatment (EPSDT) 

services. When States include PCS, coverage can be established using several State Plan options, 

under one or more waivers approved by CMS, or both. 

Generally, PCS consists of services supporting ADL, such as movement, bathing, dressing, 

toileting, and personal hygiene, or lADL, such as meal preparation, money management, 

2 
60 


shopping, and telephone use. Typically, an attendant provides PCS and rules for attendant 

qualifications are set by States. Given the nature of the services provided, personal care provider 

qualifications have tended to be less formal than those for providers of nursing or licensed 

therapies. Many States have adopted personal care provider qualifications such as minimum age 

requirements, possession of a valid driver's license, criminal background checks, and completion 

of training required by the State and specific training required by the beneficiary. Certain 

Medicaid authorities allow States to offer family members or legal guardians the option to 

become a paid attendant. 

There are generally two models of PCS service delivery that States can choose to make 

available: agency-directed or self-directed. Agency-directed is the traditional delivery model for 

PCS. Under this approach, a qualified PCS agency hires, fires, pays and trains personal care 

attendants (PCAs) to provide services to eligible individuals. A variation of the agency model is 

the "agency with choice," in which an agency is co-employer with the beneficiary of PCS 

attendants. Self-directed PCS is an alternative to the traditional delivery model. Under selfdirected models, beneficiaries or their representatives have decision-making authority over PCS 

and take direct responsibility to manage their services with the assistance of a system of 

available supports. In self-direction, individuals may have the option, and therefore the 

responsibility, for managing all aspects of service delivery in a person-centered planning process 

including, but not limited to "Employer Authority" which includes recruiting, hiring, training 

and/or supervising providers and "Budget Authority," pursuant to which the individual directs 

how State-authorized Medicaid funds in a participant budget are spent. Beneficiary decisionmaking and autonomy arc hallmarks of self-directed models of service provision, and CMS 

strongly encourages States to collaborate with stakeholders in considering use of self-directed 

models with necessary supports and a person-centered planning process. By allowing 

beneficiaries to choose trusted friends and family as PCS attendants, the usc of self-directed 

programs has assisted in increasing the pool of providers available. 

As a result of receiving HCBS, including PCS, many beneficiaries have been able to achieve 

greater independence and community integration and have been able to exercise self-direction, 

3 
61 


personal choice, and control over services and providers.2 Maintaining this State flexibility is a 

critical component in CMS's overall efforts to encourage innovation and facilitate States' abilities 

to address the specific needs of their residents. Studies suggest the HCBS delivery system is 

more cost effective than an institutional placement\ and a 1915( c) HCBS waiver can only be 

approved as long as, on an annual basis, the State can verify that the cost of services in the 

community does not exceed the cost of services in the associated institutional settings. 

CMS Support for State Program Integrity Efforts 

While PCS programs vary greatly by State and within States, States must request and receive 

approval from CMS to operate the programs and specify the services to be delivered, and CMS 

works in concert with the State through the review process to ensure that the State oversight 

system is sufficient and that individuals have appeal rights. In addition, in the newer PCS 

coverage authorities and in the l9!5(c) waiver program, States are required to report, track, and 

evaluate data, including allegations of abuse, neglect, exploitation, and unexplained death. Their 

reviews of this data are reported to CMS on a regular basis, and we take action as permitted 

through regulation to address any concerns identified. In an effort to continuously improve the 

quality of care provided, and in response to GAO and OIG recommendations, CMS has taken a 

number of steps to improve program coordination by issuing additional guidance, providing 

technical assistance to States, and modernizing Federal databases. 

In January 2014, CMS promulgated a final rule 4 that harmonized many requirements for HCBS, 

including PCS. These regulations addressed beneficiary assessments and plan of care provisions 

for certain programs that provide PCS. The final rule also provided States with the option to 

combine coverage for multiple target populations into one waiver to facilitate streamlined 

administration of HCBS waivers, and allowed States to usc a five-year renewal cycle to align 

concurrent waivers that serve individuals eligible for both Medicaid and Medicare. The rule also 

requires that States safeguard against the provision of unnecessary or inappropriate services and 

2 https://kaiserfam i ly foundation. files. wordpress.co m/20 14/03/8568-medicaid-beneficiaries-who-need-home-andcommunity-based-scrvcies.pdf 

3 https://aspe.hhs.gov/basic-report/cost-effectivcness-home-and-community-based-long-tcrm-care-serviccs 

4 79 FR 2948, January 16,2014 

4 
62 


supports, relying on principles of person-centered planning to describe the services needed to 

address issues identified in an assessment of the individual's healthcare status. 

More recently, CMS published guidance for providers summarizing some of the key PCS and 

PCA requirements, a brief explanation of differences between PCS and home health services, an 

overview of common causes of improper payments, and guidance on how to avoid them. 5 In 

February 2016, CMS provided training6 to State officials on monitoring fraud, waste, and abuse 

in home and community-based settings for PCS. The training included information on O!G's 

recent PCS findings and possible actions States can take to help to identify and prevent PCS 

waste, fraud and abuse. 

CMS has also recently issued Informational Bulletins to States providing suggested approaches 

for strengthening and stabilizing the Medicaid home care workforce 7 and other options to 

strengthen program integrity in Medicaid PCS. 8 For strengthening and stabilizing the Medicaid 

home care workforce, suggestions included the implementation of a registry to reflect individuals 

meeting the State's provider qualifications, if applicable, and the option for States to require 

basic training to workers without usurping beneficiary decisions on what skills are most 

appropriate for their homccare workers. To address vulnerabilities regarding improper payments 

for PCS services, we recommended that States establish adequate post-payment review 

processes, incorporate prepayment edits that automatically deny unusual activity, such as 

duplicative billings for the same service and duplicative billing during an individual's 

institutional stay, and perform ongoing audits. Other options identified to address program 

integrity within PCS programs included developing and implementing procedures for ensuring 

compliance with requirements for provider qualifications and screening, and verification of 

beneficiary need for services. 

5 https:/lwww.cms.gov/Medicare-Medicaid-Coordination/Fraud-Prevention/Medicaid-lntegrityEd ucation/Down loads/ pcs-improperpayment-factsheet -082914 .pdf 6 https://www.medicaid.gov/medicaid/hcbs/downloads/hcbs-3a-fwa-in-pcs-training.pdf 

7 https:l/www. med icaid.gov/ federal-poI icy- guidancc/downloads/ci bO 80316 .pdf 8 https:i/www.medicaid.gov/fcderal-policy-guidanccidownloadslcib l21316.pdf 

5 
63 


Last November, to better ensure the successful delivery of HCBS, including PCS, CMS released 

a Request for Information 9 to solicit feedback on the following: 

The benefits and consequences of implementing standard Federal requirements for 

personal care workers in agency-directed and/or self-directed models of care; 

• The criteria of what standardized qualifications would include, in terms of educational, 

minimum age, and screening requirements; 

• Circumstances in which standardization would not apply or would require different 

standards; 

• The role of State-administered home care worker and/or PCS attendant registries; 

• The role of criminal background checks; 

• The role of home care worker organizations in providing training to support 

implementation of Federal qualification standards; 

• The feasibility for State Medicaid programs of including home care worker identity on 

claims submitted for reimbursement; 

• Program integrity safeguards that could be used instead of or in addition to OIG's 

recommended controls for both agency-directed and self-directed PCS; and 

• Program integrity safeguard development 

CMS received over 500 comments in response, and we are in the process of analyzing this 

feedback and will incorporate suggestions as appropriate. As we move forward with program 

improvement efforts, CMS is committed to maintaining State flexibility for PCS, in terms of 

provider qualifications and oversight. 

In February 20I 7, CMS focused a Medicaid Integrity Institute (MII) 10 course on PCS. The Mil is 

a CMS-funded program that provides training to State Medicaid and program integrity 

staff. CMS developed the "Emerging Trends in HCBS/PCS" course to bring together State and 

Federal stakeholders to discuss vulnerabilities, mitigation strategies, and challenges and barriers 

related to PCS administration. Federal participants included CMS, OIG, and the Department of 

9 https:ilwww. federalregister.govldocuments/20 16111/09120 16-27040/medicaid-program-request-for-informationrfi-federal-g9vernment-interventions-to-ensure-the 1

° For more info, see Mil "About" page: https://www.justice.gov/mii/aboul 

6 
64 


Justice (DOJ). State participants brought clinical, program integrity, policy, operations, social 

work, law enforcement, and programmatic expertise to the course. This diverse structure allowed 

participants to articulate and develop a holistic approach to PCS program integrity. As a result, 

the class participants reached consensus on potential program considerations that support the safe 

delivery of services to vulnerable populations of beneficiaries eligible for I-I CBS and PCS and 

more effective stewardship of program funds. 

CMS has also developed focused Program Integrity Reviews related to PCS. The reviews assess 

State program integrity effectiveness related to PCS, and provide States with feedback in terms of 

vulnerabilities that may exist as well as resources to correct the vulnerabilities and identify best 

practices which can be shared with other States. CMS will conduct this type of focused review in 

five States in 2017 (lA, MS, NY, SD, and TX). 

Finally, as part of the 21" Century Cures Act (P.L. 114-255) enacted last December, starting in 

2019, States must require PCS provided under Medicaid to use an electronic visit verification 

(EVV) system in order to receive the full Federal medical assistance percentage. EVV systems 

electronically record the date, time, and, in some cases, location of a PCS provider's visit to a 

beneficiary by utilizing technology such as cell phone GPS, digital signatures with time and date 

stamping, or biometric recognition. Already, many States have either mandated or encouraged 

the usc ofEVV systems. We look forward to continuing to work with States as they move 

forward in their design and implementation processes of these systems. 

Conclusion 

CMS and States have worked for decades to support increased availability and provision of 

quality HCBS for Medicaid beneficiaries, which is not only a more cost-effective method of 

service delivery, but is also often the option preferred by individuals receiving services. CMS 

greatly appreciates the work ofOIG and GAO regarding the potential vulnerabilities in the 

provision of Medicaid PCS, and we look forward to continuing our partnership with these 

agencies as well as the States. As we continue to improve program integrity for PCS, we must 

also work to ensure that any additional oversight requirements do not create administrative 

burden, increase costs and impact beneficiary choice and control. We will continue to assess the 

7 
65 


operational feasibility for States of these recommendations and the implications for beneficiary 

access and quality of services. The successful delivery ofPCS to Medicaid beneficiaries must 

ensure that both individual needs and preferences are met and that the program has adequate 

safeguards in place, and we look forward to continuing to improve our efforts in these areas. 

8 
66 

Mr. MURPHY. Thank you, Mr. Hill. I’ll recognize myself for 5 minutes. First of all, Ms. Grimm, Ms. Iritani, I want to commend you 

and your offices. It doesn’t happen a lot in Congress, but in terms 

of a branch of the Federal Government that do their job, we thank 

you for doing that. We are absolutely indebted to you for these discoveries, and there’s a real trust we have in this committee for the 

work you do. So please pass that compliment on to your other 

workers as well. 

That being the case, it bothers us about the stories you’re telling 

us, the fraud and abuse and how it really hurts the beneficiaries, 

the elderly, and disabled individuals. 

And there’s certain elements of this, Ms. Grimm, that you talked 

about, the PCS, that make it more susceptible to fraud for the vulnerable. You mentioned in some of your testimony some of the stories that beneficiaries often feel reliant on or loyal to their attendant—it sort of reminds you of the Stockholm Syndrome here—but 

even if that attendant is committing fraud or abuse and harm. So 

why is that, and what is in the system inherent in that that leads 

to that and, of course, how do we change it? 

Ms. GRIMM. Thank you for your question. I think inherent to personal care services is sort of the intimate nature of those services, 

going into beneficiaries’ homes and providing services like bathing, 

dressing, light housekeeping, food preparation. And in many of 

those instances, as you point out, the beneficiary becomes very reliant on those services, and in their mind services, even if they’re 

suboptimal, are better than no services, and we have found apprehension on having fraud and abuse reported by beneficiaries. Often 

referrals come to us from families or loved ones that are witnessing 

neglect. 

Mr. MURPHY. Are there threats made, subtle threats in terms 

of—that sometimes occur under these circumstances? 

Ms. GRIMM. I’m not aware of a specific instance where the beneficiary was told they could not report, but we certainly have plenty 

of examples of harm that’s resulted from fraud. 

Mr. MURPHY. And I’m wondering in these cases, too, at times 

maybe a family puts up a hidden camera in the home, too, and also 

records events. Have those occurred? Have you seen anything like 

that? 

Ms. GRIMM. Hidden cameras in beneficiaries—— 

Mr. MURPHY. Families many times do that with their babysitters, too, that may actually record some instances where a PCS 

worker was causing some problems. Have you seen any instances 

of that yet? 

Ms. GRIMM. I don’t have any instances of that, but we do have 

examples of family members that are perpetrating the harm and 

neglect with the beneficiary, so even in those scenarios where it’s 

self-directed PCS, we are still seeing instances of family members 

committing that harm. 

Mr. MURPHY. So given all of these stories and the heart-breaking 

nature of them, if you could choose a recommendation you think 

would make the biggest impact, what would it be? 

Ms. GRIMM. We want to know who we’re doing business with at 

the attendant level. So the number one recommendation that I 

67 

would put forward is that you enroll and register attendants and 

make sure that those identifiers are on the claims. 

Mr. MURPHY. And background checks, full background checks on 

them, too? 

Ms. GRIMM. We do recommend background checks. Many of the 

instances that we included in our investigative advisory would 

have revealed a history of criminal conduct, including drug diversion. 

Mr. MURPHY. And what other kinds of backgrounds would be in 

this besides drugs? Felonies, burglaries? 

Ms. GRIMM. We do have another example of a case in Illinois 

where a nurse had lost her licensure because she was stealing 

drugs from her employer. And in that instance, she was excluded 

from all Federal healthcare programs and a check, like we recommend for other programs and looking at the exclusions list, 

would have revealed that. 

Mr. MURPHY. OK, thank you. Ms. Iritani, what impact does CMS 

have? How is it, in fact, not getting data on time? You made references to this data. How does this affect the oversight ability for 

CMS on PCS workers? 

Ms. IRITANI. Data is critically important to really overseeing the 

program. CMS needs data to ensure that payments are appropriate 

and to assess trends and to ensure that the Federal matching is 

appropriate for what States are claiming from the Federal Government in terms of provided services. 

Mr. MURPHY. Thank you. And Mr. Hill, given the kind of things 

here, what steps do you see moving forward that you could use to 

improve this whole process? 

Mr. HILL. So I think I would focus on two areas that have been 

highlighted. First, on the policy side and the recommendations with 

respect to standards. We’ve talked to the IG. We issued our RFI 

last year. For us, it’s a balance, right, so every State is a little different. The requirements in one State may not be the requirements 

we want to have in every State, so we’re anxious to continue our 

analysis there to determine whether or not we should be putting 

more requirements on States that internally have their own set of 

standards or whether we should be doing that nationally at the 

Federal level. 

Second, and I couldn’t agree more, I think, with our colleague 

from the GAO that the dearth of data in the Medicaid program is 

a problem. We’ve done a lot over the last year to get data in in a 

much more timely way in a way that will let us do analysis, not 

only for our own selves, but also to give information back to the 

States about how their programs are operating and so continuing 

our effort to get data in to make that data timely and accurate I 

think is very important. 

Mr. MURPHY. Thank you. I’m out of time. Ms. DeGette, you’re 

recognized for 5 minutes. 

Ms. DEGETTE. Thank you, Mr. Chairman. I’m gratified to hear 

that members on both sides of the aisle recognize the importance 

of the Personal Care Services program to Medicaid beneficiaries 

and also the potential cost savings that we can get. But I do think 

that we can work together to address where controls need to be improved. 

68 

A little note, one of the many little known provisions in 21st 

Century Cures which, of course, this entire committee worked together on, required an electronic visit verification system for personal healthcare services and home healthcare services under Medicaid. What this requirement said is by 2019 all personal care visits 

have to be electronically verifiable and that standard background 

information would be collected on every claim which I think would 

help. That would be a help. 

I just want to ask the panel some of the questions about the 

scope of the Personal Care Services program and what we can do. 

Mr. Hill, you heard Ms. Grimm talk about some of these services, 

particularly to the elderly who can stay in their homes. I think we 

all agree this program can be very beneficial to people like that, 

is that right? 

Mr. HILL. It’s incredibly beneficial. For every example and every 

conversation we have with the IG about abuse and the horrible 

things that are going on, I think there’s also as unreported sort of 

hundreds of examples of folks who are now living in their home, 

in their community with attendants and workers who make their 

lives fulfilling in a way that would not be if they were in an institution, people who have suffered broken limbs, broken back or 

where they have intellectual disabilities or any number of medical 

conditions that normally keep them in an institution are keeping 

them in their communities. 

Ms. DEGETTE. And not only that, but it also is more cost effective 

than putting them in nursing homes, is that correct? 

Mr. HILL. Absolutely, even as the GAO has noted, the highest spending State for PCS is close to $30,000 per beneficiary. Nursing 

homes are easily three to four times that amount. 

Ms. DEGETTE. Thank you. Now Ms. Iritani, I think you testified 

to this, your January 2017 audit found that the CMS data is of limited value for oversight purposes because it’s often not timely and 

it’s inconsistent across State lines and has errors. Is that correct? 

Ms. IRITANI. That’s correct. 

Ms. DEGETTE. And also, this is important. Although there are 

problems with the quality of data, it doesn’t necessarily mean 

there’s widespread fraud in the program, is that right? 

Ms. IRITANI. That’s correct. 

Ms. DEGETTE. And so why do you think the States are having 

such a hard time providing accurate and timely data to the CMS? 

Ms. IRITANI. There are a host of different reasons and we didn’t 

look at that specifically. We have on-going work actually looking at 

challenges that States are having with implementing T–MSIS, the 

utilization claims system. More work needs to be done. But some 

of the things that we are aware of in terms of some reasons States 

haven’t submitted is related to new systems that they’re putting in, 

maybe to comply with T–MSIS and other reasons. 

Ms. DEGETTE. Don’t you think it would be a good idea to work 

with the States so that we can get the data that we need because 

we can’t really even begin to get our arms around the extent of the 

problem until we have that data? 

Ms. IRITANI. Yes. 

Ms. DEGETTE. Can anybody testify what efforts we’re making to 

standardize and to get that data? Mr. Hill? 

69 

Mr. HILL. I’ll speak briefly on where we are with the data collection. As GAO has pointed out, historically, the Medicaid data that 

we’ve gotten into CMCS has not been timely. It’s not been accurate. 

Beginning 4 years ago, we began implementing a transformed system, a new system to collect use data, utilization data, claims data 

from States in a much more timely and standard format. We now 

have requirements in terms of what data the States have to submit, how it has to be submitted and the timeliness of that. 

We now have 35 States representing more than 60 percent of the 

beneficiaries and expenditures in the country reporting data into 

that system. We’re beginning to share that data with our partners 

to do quality assessment and be sure that it’s useable and it has 

fixed a lot of the vulnerabilities that have been identified by the 

GAO and are hoping, we, CMS, will be ready to accept data from 

all States by the end of the summer. 

Ms. DEGETTE. Great. Let me stop you there because I’m out of 

time. 

Mr. HILL. Yes. 

Ms. DEGETTE. Let me just say I think this would be a perfect 

hearing for the fall, Mr. Chairman, to bring the States in to talk 

about are they complying with that deadline of this summer and 

to see what else they need. 

Mr. MURPHY. Right, and we also had that briefing before that 

most States are not even getting data. 

Ms. DEGETTE. Right. 

Mr. MURPHY. So we’re kind of flying blind. So appreciate it. 

Ms. DEGETTE. OK, thanks. I yield back. 

Mr. MURPHY. I recognize the chairman of the committee for 5 

minutes. 

Mr. WALDEN. Thank you, Mr. Chairman. Ms. Iritani, in your report on PCS data, you were only able to analyze 35 States because 

15 had not reported the data yet, as you all are having this discussion from 2012. So you conducted this audit from July 2015 to January of 2017 and as of then, 35 of 50 States had enough data from 

2012 to analyze, correct? 

Ms. IRITANI. Correct. 

Mr. WALDEN. Why were the data so late? Is this a common problem? Once it gets there, it just seems like it can take several years 

for CMS to process it, and why is that? 

Ms. IRITANI. And I think there are two issues. One is that States 

submit data late, and it could be because they are largely managed 

care, and managed-care plans may submit data late or may not 

submit data at all. 

The other problem is that when the data comes in, it is not good 

and so CMS needs to go through a lengthy validation process which 

is part of why we only had data for 35 States several years later, 

is that the data had not been validated for those other States. 

Mr. WALDEN. Makes is it pretty hard to do appropriate oversight 

and reconciliation and everything else then? 

Ms. IRITANI. Yes. 

Mr. WALDEN. Mr. Hill, GAO’s January 2017 report raised concerns about these processing times. What’s the average time it 

takes to process 1 year’s worth of data, if there is such a thing as 

an average time? 

70 

Mr. HILL. Right, so as identified, the data that the GAO looked 

at in the system that they were looking at was the system that is 

prior to the one we’re using now. So for a State, for example, that’s 

what we call live, submitting data into our system. For the 35 that 

I’ve identified that are processing, we have up-to-date data within 

a month current to the year, right, so if it’s March and they submitted the data on the 1st of—from January and it’s consistent, 

current for January. 

Mr. WALDEN. All right. 

Mr. HILL. Now as I said, we’ve built in a lot of the front-end control to be sure that we don’t have to take as long as we were taking 

in the prior system to do the quality check. Those quality checks 

are built in upfront. So we’re confident and hopeful, I should say, 

and confident that this new system will both provide data much 

more timely, much more consistently, and in a way that will allow 

us to do the analysis and the oversight in a way that we could not. 

Mr. WALDEN. OK. Ms. Iritani, a question back to your comment 

about the managed-care plans, could the States or the Federal Government make a condition of the contract with the managed-care 

plans that they have to submit data on a regular basis in a format 

that works for the expedited review and do we do that? 

Ms. IRITANI. Yes, they are required to. It’s more a question of enforcement. 

Mr. WALDEN. What’s the penalty if they don’t? 

Ms. IRITANI. I think that will depend on the contract that the 

States have put in place with the managed-care organization. 

Mr. WALDEN. And we could probably weigh in on that contract 

requirement since we’re a partner in this process? 

Ms. IRITANI. That would be a policy decision. 

Mr. WALDEN. Yes. OK. Ms. Grimm, I understand a beneficiary in 

Pennsylvania died of exposure to the cold while under the care of 

a PCS attendant according to some of the reports. In another case, 

a hot July day, a PCS attendant in Maryland left a beneficiary 

with developmental disabilities in a locked car while shopping with 

a companion. 

What’s the most important thing CMS can do to prevent beneficiaries from being subject to neglect and abuse by PCS attendants? 

Ms. GRIMM. Move to require States to enroll or register a care 

attendant so that we’re able to keep track of what’s happening at 

that attendant level. 

Mr. WALDEN. OK, and what reaction, if you get any, from the 

States when this is suggested? 

Ms. GRIMM. We have a report coming out at the end of the summer that provides survey data from the Medicaid Fraud Control 

Unit Directors on the recommendations that we have put forward, 

also fraud trends related to personal care. We know that that 

group very much endorses the recommendation that we’ve put forward related to enrollment and registry. And the report will also 

have some other solutions States have explored. 

Mr. WALDEN. OK, perfect. How do you investigate fraud when it 

involves beneficiaries’ family members because we understand 

that’s a problem, too? 

71 

Ms. GRIMM. One thing that I think this committee could also do 

is to give our Medicaid Fraud Control Units the authority to investigate stand-alone harm in patients’ homes. They currently only 

have the authority to investigate when it’s associated with billing 

fraud. So it does become challenging to investigate harm when it 

is not linked to some of those other billing issues. 

Mr. WALDEN. My time has expired. Thank you again for the good 

work that you are doing and your counsel to us. We appreciate it. 

Mr. Chairman, I yield back. 

Mr. MURPHY. All right, I now recognize Mr. Tonko for 5 minutes. 

Mr. TONKO. Thank you, Mr. Chair. It’s good to see CMS here 

today to talk about improvements that CMS can make and should 

make to this program. But let’s not forget that the Medicaid program and PCS, in particular, is a partnership between the Federal 

Government and the States. States are given flexibility to design 

their given programs to fit the needs of their populations, but in 

exchange they have to do their part to ensure the integrity of the 

programs. 

States are the first line of defense in protecting Federal and 

State Medicaid dollars. So with that being said, Mr. Hill, in your 

testimony you stated, and I quote, ‘‘Both the Federal Government 

and States have key roles as stewards of the program.’’ 

So is it accurate to state that CMS cannot perform effective oversight without cooperative State partnerships? 

Mr. HILL. I think oversight is always more effective when there’s 

cooperation between us and the States. We have our role. The 

State has their role. Sometimes there will be tension, right, between what we view as a direction the State needs to be or whether or not they’re in compliance with Federal rules. But we always 

prefer to be working—particularly on issues of beneficiary harm 

and abuse—working hand in glove to make sure that we mitigate 

those. 

Mr. TONKO. So what does CMS need from the States to improve 

this whole outcome? 

Mr. HILL. As I’ve indicated earlier, I think in any oversight context, the more data we have and the better data we have with 

States and States being up to date with submitting that data is 

going to give everybody a leg up in terms of understanding what 

our problems are and how we meet those gaps. Beyond that, I 

think States as identified by the IG, each have their own requirements for how they oversee and maintain the integrity, in particular, of personal care attendants and how those services are 

being delivered. And we need to make sure that States are following through and enforcing those individual State compliance, 

right? 

We don’t have the resources, nor is it our job, to on a day-to-day 

basis be monitoring claims and understanding how the benefits are 

being delivered in any particular State. So the State really needs 

to be in a position to step up and be doing that work on behalf of 

those beneficiaries. 

Mr. TONKO. Thank you. And Ms. Iritani, would you agree that 

the responsibility for program integrity falls on both CMS and the 

State Medicaid programs? 

Ms. IRITANI. Yes. 

72 

Mr. TONKO. So the OIG has done a lot of excellent work looking 

at different State programs and pointing out vulnerabilities and 

short comings. I understand that OIG’s audits of some States have 

found problems with PCS claims such as providers claiming more 

hours than were recorded. 

And again, that being said, Ms. Grimm, it seems clear that 

States need to make improvements. Do you believe that the provision passed by the last Congress which does require States to ensure PCS visits are electronically verified will help address some 

of the issues that have been raised by the OIG? 

Ms. GRIMM. Thank you for that question. We very much appreciate some of the protections and collection of data that’s offered by 

that provision in 21st Century Cures. We know that that does not 

currently include managed care and, with the high percentage of 

services in Medicaid being provided through a managed-care 

model, it definitely does not sort of wrap around those services, but 

it is a terrific step forward and it does collect some of the information that would allow our criminal investigators to detect potential 

patterns of fraud. Yes. 

[The HHS Office of Inspector General submitted the following 

amended portion of Ms. Grimm’s response:] 

We know that that may not currently include managed care and, with the 

high percentage of services in Medicaid being provided through a managedcare model, it may not sort of wrap around those services, but it is a terrific 

step forward and it does collect some of the information that would allow 

our criminal investigators to detect potential patterns of fraud. 

Mr. TONKO. Thank you. And what additional resources do States 

need in order to conduct better oversight of the PCS programs? 

Ms. GRIMM. I think having uniformity in the kinds of standards 

that are required, the qualifications, some floor requirements for 

the care attendants upon which States can build and customize according to the special needs of those States. I think that would better put States in a good position to make sure care being rendered 

to their beneficiaries is of a high quality. 

Mr. TONKO. Thank you. And Mr. Hill, what steps is CMS taking 

to encourage or require States to do more in this area? 

Mr. HILL. So we’ve taken a number of steps in terms of working 

with States on education, giving them best practices and feedback 

about program integrity, methods and standards, be it through review of claims, how to put edits in place to review claims for highdollar or unsubstantiated services, helping them think about putting together registries or enrollments for PCS attendants. But beyond that, we’re also working with States to provide direct training. We have a facility where we can bring States in and bring our 

law enforcement partners in to do hands-on work to understand 

better how to do investigations around PCS types of work and what 

kind of policies to put in place to prevent those types of abuses 

from occurring. 

And finally, we’re doing our own work to understand whether or 

not more Federal requirements are needed beyond just requiring 

States to have their own internal policies, particularly around enrollment of attendants should there be a Federal standard, should 

73 

we have nationwide standards for how these attendants ought to 

be monitored and overseen. 

Mr. TONKO. And that training is up and running now? 

Mr. HILL. Yes, we had training back in February. We had 36 

States, a number of our partners from law enforcement and the 

oversight community, and we’ll continue to do that. 

Mr. TONKO. Thank you very much, Mr. Chair. I yield back. 

Mr. MURPHY. Thank you, Vice Chairman Mr. Griffith is recognized for 5 minutes. 

Mr. GRIFFITH. Thank you very much. Ms. Iritani, it’s my understanding that States can receive more Federal money in the form 

of a higher match for some activities related to collection and compliance with Federal reporting requirements. Am I correct in that? 

Ms. IRITANI. Yes, that’s correct. 

Mr. GRIFFITH. And so you’re having difficulty getting States to 

get some of the reporting and so forth. And I’m going to switch 

gears in a minute on that. But do you have a stick? You’ve got the 

carrot. Do you have a stick that they might receive a lower match 

if you they’re not collecting some of the data that you want? 

Ms. IRITANI. CMS does have authority to reduce the Federal 

matching for system areas that are experiencing problems from a 

75 match to a 50 percent match. 

Mr. GRIFFITH. Now let me switch gears a little bit because I am 

worried about the States and I think that some of the resistance 

from the States may come from a fear that they’ll chase some folks 

out of this industry, particularly when you’re dealing with family 

members and we all want to stop the abuse, but when you’re talking about family members I heard, I believe it was you who earlier 

said that some States had 400 different codes, and so it was hard 

to get the coding straight. And I can see a family member who is 

trying to take care of their loved one is receiving some monies for 

bathing or doing some daily activity where the mom or the dad of 

theirs needs help and then they’re faced with having to learn 400 

codes. So I think if we’re going to do something, we have to make 

it simple. Would you not agree? 

Ms. IRITANI. Yes, we would agree with the harmonization of requirements. The 400 codes was actually at the Federal level in 

terms of how PCS was coming in in terms of the coding. 

Mr. GRIFFITH. So if we’re going to require electronic verification 

which I think is fine as long as it can be done on the phone because 

most people will have their electronic phones with them, their little 

gadgets, and this is where tele stuff can be of great help, technology can be of great help to us, but it needs to be simplified because you’re going to have a hard time—if you’re just a 50-someor 60-some-year-old child trying to do the best you can for your parents because Mr. Hill, you did point out earlier, we see in the news 

all the horror cases. What we don’t see are the thousands of people, 

whether they be the professionals who are coming in or the agencies that are sending people in or whether it’s a family member, 

where that person’s life is greatly enhanced by having a PCS individual helping them out through one of these programs and I get 

that. 

It also raises some concerns for me that not only do we have to 

simplify it, but we have to be careful because there’s a difference 

74 

between somebody who’s working for an agency that sends in folks 

and that family member. Because while we want family members 

monitored to a certain degree, I’m not sure we want to create a 

whole new bureaucracy to monitor them. We have the Department 

of Social Services, at least in the Commonwealth of Virginia that 

already is aware of that and if something is going on a neighbor 

can report and they go out just like they would with a child, for 

child abuse, and look for that. 

Then we also have this whole thing where everybody is like let’s 

do background checks. The question is if we’re going to do background checks and I’m not against that, but we need to make sure 

that we’re not throwing the baby out with the bath water. Because 

absolutely, if you’ve got a history of child abuse or spousal abuse 

or abuse of a parent, even if you’re a family member, you ought not 

be involved. But a theft—I was a criminal defense attorney, by the 

way, for 28 years—so a theft of four tires off of an automobile when 

you’re 18, it’s a theft, Mr. Chairman raised that issue and he was 

right to do so. It’s a theft. It may want to be something that you 

take a look at, but I’d hate to see a son who’s now in his 40s or 

50s being precluded because he came back with a felony conviction 

20-some years ago on stealing tires or doing something that, when 

you look at the facts, it’s a whole different case than just running 

it through. 

And the problem is when Government gets a hold of a criminal 

background check, oftentimes they come up with hard and fast 

rules. If you’ve been convicted of X, you can’t be involved. And I 

think we need to set that bar fairly high. I’m not sure it shouldn’t 

be our responsibility. What do you all have to say about that? 

Go ahead, Ms. Grimm. I think you’re the right person to start on 

that. 

Ms. GRIMM. OK, I very much appreciate the question and that 

context absolutely matters. We believe that those background 

checks can reveal information that consumers can use and their 

family members can use to make informed decisions about the care 

that’s provided. 

Mr. GRIFFITH. OK, so you would look for if we were going to craft 

some language along those lines to say have the background check 

done, but then it would be the family members who would decide 

or it would be forwarded to Department of Social Services, something along those lines? Would that be your proposal? 

Ms. GRIMM. I think we would want there to be guidance to be 

accompanying the types of convictions and histories that are revealed through those background checks, but we have not gone forward with a recommendation that says this specific kind of crime 

should preclude them from providing personal care. CMS can provide some exemptions and we’ve had those conversations with 

CMS. 

Mr. GRIFFITH. And if you all decide to go with guidance, I’m 

happy to assist in any way I can to have you come up with ways 

that you may be able to ferret out the bad actors without throwing 

out the folks who might have made a mistake at one point in time. 

Likewise, maybe you all can help us come up with the proper 

guidelines to put into the legislation that would give you that authority. 

75 

With that, Mr. Chairman, I yield back. 

Mr. MURPHY. I recognize the gentleman from California, Dr. 

Ruiz, for 5 minutes. 

Mr. RUIZ. Thank you very much, Mr. Chairman. I think everyone 

can agree that we must do all that we can to maintain program 

integrity in the Medicaid Personal Care Services program and continue to work to eliminate fraud and abuse, and we must continue 

to identify common sense improvements to this program such as 

better data collection and Federal baseline standards, but we must 

do so by maintaining patient access to this critical program that allows individuals to remain at home and live independently when 

they might otherwise be forced to move to a nursing home or assistive living facility. 

Data collection is integral in evidence-based policy development. 

And I think many of you had mentioned that there are some exciting opportunities here and if we don’t use data, then we’re at the 

whims of ideological partisanship that then kind of makes the 

wrong decision, contrary to what’s best for the patient and for the 

American people. 

One of the problems we’ve seen regarding this program integrity 

in the Personal Care Services program is inadequate data. A GAO 

report stated that CMS is developing an enhanced Medicaid claims 

data system known as the Transformed Medicaid Statistical Information System pronounced as ‘‘T–MISSIS,’’ right? Under T–MSIS, 

States will be expected to report claims data that are more timely 

and more complete. 

Mr. Hill, it’s clear that T–MSIS is a critical tool to ensure timely, 

accurate, and complete data from States, and it is my understanding States have been working for years to implement the new 

system. What steps has CMS taken to complete T–MSIS this year? 

Mr. HILL. So this year, we’ve actually had a good year this year. 

As I mentioned earlier, we’ve now got 35 States reporting and I 

think most of them are current with their data reporting. We’re 

working with the remainder of the States to meet them where they 

are, to make sure that they have everything they need in place to 

begin reporting and will be ready to take their data by the end of 

the summer. Whether they can meet that deadline or not is something we’ll continue to work with them on. 

Mr. RUIZ. How many States? What’s the percentage? And what 

year do you think we’ll have everybody on board? 

Mr. HILL. I’m hopeful that by the end of this year we can have 

all States in. Now again, that all depends on whether States are 

going to be able to internally meet their own deadlines. As you 

know, Medicaid is incredibly complex at the State level and they’re 

integrating State data from many State systems. And so it’s a challenge for them to be able to put it into a common core. 

Mr. RUIZ. So what additional claims information will be included 

under T–MSIS, and how will this improve the integrity of the Medicaid claims data? 

Mr. HILL. I think the single biggest piece of information that 

we’ll have out of—and this is where—it’s hard to know when you’re 

supposed to correct a congressman, but it’s ‘‘T–M–SIS.’’ 

Mr. RUIZ. ‘‘T–M–SIS.’’ 

76 

Mr. HILL. When we have the T–MSIS data in, particularly data 

around providers, right, so there’s just a statutory requirement now 

to be providing, referring, and ordering information on a claim so 

we’ll know who referred, who ordered a service and we’ll know 

more information about the providers that are submitting claims. 

Under the old prior information, we didn’t have that enrollment information and we didn’t have the ordering and referring information from providers. 

Mr. RUIZ. Ms. Iritani, how will any further delay impact the integrity of the Medicaid claims data in the near future? 

Ms. IRITANI. Significantly. Reliable data is really important for 

overseeing improper payments and other functions, and we have 

recommendations to CMS on personal care services in particular 

that CMS should issue guidance that is standard on reporting of 

personal care services and, with regard to T–MSIS, should really 

prioritize the data that CMS needs for oversight. 

Mr. RUIZ. So I understand that while there are reported benefits 

of implementing T–MSIS, it is not a cure-all, correct? 

Ms. IRITANI. Correct. 

Mr. RUIZ. For example, in your report, you stated that CMS will 

need to develop plans for how it can be used for oversight. Can you 

give me some examples of how that can be used for oversight? 

Ms. IRITANI. Well, ensuring, for example, that the Federal matching for what States are claiming as expenditures is appropriate. 

Our work found, for example, that 17 percent of the expenditure 

line reporting for personal care services was incorrect. 

Mr. RUIZ. Would you say this is the number one most impactful 

way to start providing oversight for potential fraud and abuse, is 

if we were to focus on one thing would it be the data collection system, Mr. Hill? 

Mr. HILL. For me, I mean we are focusing on it now and it continues to be a priority. You can’t run a program of the size and 

scope of Medicaid without good, accurate data. 

Mr. RUIZ. So what do you need to finish this in a timely manner? 

Mr. HILL. We need the continued cooperation of States to get 

their data in and to do the work they need to do to get the data 

in a timely way and we have that and we’ll continue to work with 

them. 

Mr. RUIZ. Thank you very much. 

Mr. MURPHY. Mr. Collins, you’re recognized for 5 minutes. 

Mr. COLLINS. Thank you, Mr. Chairman. I want to thank the witnesses also. 

Now I’m a private-sector guy. I spent 30 years in the private sector and at one point I also was the county executive of the largest 

upstate county in New York. It was bankrupt. I’m a Lean Six 

Sigma guy. I brought Lean Six Sigma into a large municipal government for the first time in the United States about 8 years ago. 

And it worked. But we also had a program called Just Do It. We 

would put together a team of a lot of different commissioners and 

we’d deep dive some issue that touched on a lot of different departments and it would take us 6 months. And then every once in a 

while we’d come up with what we’d called the Just Do It. It was 

so obvious, so direct. We knew the problem. We really knew 90 perVerDate Mar 15 2010 09:58 Aug 02, 2017 Jkt 037690 PO 00000 Frm 00080 Fmt 6633 Sfmt 6633 I:\115THCONGRESS\115X29MEDICAIDPCSXASKOK071317\115X29MEDICAIDPCSXPDFM
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cent of the solution. We said why are we going to waste our time 

with this 6 months’ program. Let’s just do it. 

And kind of sort of what I’m hearing today is a lot of just do it. 

So what am I missing here? The Federal Government sends money 

out to the States. In the case of New York, our program is $60 billion a year. So with 6 percent of the Nation’s population, we spend 

12 percent of the Nation’s Medicaid money and it just keeps flowing. 

In the private sector, if I have a vendor and he sends me an invoice and he doesn’t have the proper numbers on it, I don’t pay it. 

If he sends me an invoice and whatever requirements that I’ve had 

aren’t there, I don’t pay it. So here’s my just do it. 

Now no disrespect intended, but why are we wasting our time 

analyzing 2012 data? It’s worthless. Completely, utterly worthless. 

There’s nothing to compare 2012 to 2017. If we’ve got a bunch of 

people crunching 2012 data, if I’m Tom Price or Seema Verma, I’d 

go what? Are you joking me? 

So if we’ve got the power of the purse strings, why don’t we just 

stop paying people, sending money to States who don’t adhere by 

our responsibilities? The requirements. Why don’t we? Why don’t 

we? 

OK, there’s my just do it. I call you and I say we’re just going 

to do it. No money goes out without the data in a timely fashion. 

Thirty-five States—well, 15 States—just wouldn’t be getting any 

more money. If you start cutting off the flow of cash, you will get 

their attention and you will get your data. You’ll get your data in 

a timely fashion. And if you have—I’m just somewhat dumbfounded by this. The solution is staring us in the face and we’re 

sitting here talking about something. I don’t get it. What am I 

missing? 

Ms. IRITANI. Well, we agree that CMS needs to take immediate 

steps to—— 

Mr. COLLINS. So why don’t we do it? Do it today. Is there a reason? We can do it today. 

Ms. IRITANI. To improve the data, yes. 

Mr. COLLINS. Today. 

Ms. IRITANI. And to issue guidance to States on standard elements that they should be reporting. 

Mr. COLLINS. Require that the attendants register. And if there’s 

not a number, they don’t get their money. 

Ms. IRITANI. There has been a longstanding, also, interest in 

making sure that there is access to services. 

Mr. COLLINS. We do. But money talks. 

Ms. IRITANI. Yes. 

Mr. COLLINS. The minute you cut off the funds, I mean, that’s 

what I find. When we talk about waste, fraud, and abuse, and we 

find that the Federal Government is sending this money out and 

then we’re finding out after the fact through data that’s 5 years old 

when in the case of 15 States they don’t submit data, you know 

where the problem lies, in CMS, for sending the money out, for approving the voucher. Don’t we have to approve payments? 

Mr. HILL. So a couple of issues to unpack there, and I think it’s 

a fair comment and it’s a true comment that the money speaks. 

Right? And if we withhold funds, States are definitely going to get 

78 

somebody’s attention much quicker than other corrective actions. I 

think for us to consider, as we talk to States and try to—particularly on their compliance issues, not so much now talking about 

program abuse of providers, billing inappropriately. 

Let’s talk about States meeting our requirements, for example, 

for submitting data. We try very hard, recognizing it’s a complex 

system to get States to get into compliance in a way short of having to withhold the funds. It’s sort of nuclear, right, to say we’re 

immediately going to go to withholding funds from the State of 

New York or any other particular State without first going through 

as much as we can with the State to be sure they’ve got all the 

TA, all the information they need, all the help they can get from 

us to get into compliance. If after that, they still are unwilling or 

unable to come into compliance, then the purse strings is definitely 

the place that we go to sort of make sure that we have their attention. 

Mr. COLLINS. And I do agree. You want to give somebody at least 

a glide path, 3 months, even 6 months, but to hear that we’re analyzing 2012 data, I mean what a tragic waste of time. 2012 doesn’t 

tell you anything about 2016, ’17. I mean truly not to be insulting 

here, I think we could get there very quickly. I’m certainly hoping 

that Tom Price and Seema Verma get there quickly and this has 

been kind of eye opening again in a frustrating way. 

Thank you, Mr. Chairman. I yield back. 

Mr. MURPHY. Thank you. I now recognize the gentlewoman from 

Illinois, Ms. Schakowsky from Illinois. 

Ms. SCHAKOWSKY. I want to thank all of our witnesses. First of 

all, care services are incredibly important and I really want to emphasize that, even as we try and make it better, I hope all of us 

are really committed to making sure that those services are provided. 

In Illinois, we have the Community Care program which is one 

of the home and community-based care services provided by the 

Medicaid benefit, to Medicaid beneficiaries and provides services to 

about 84,000 individuals. 

We also know that these are the very programs that often are 

slated for huge cuts. In Illinois, unfortunately, we haven’t had a 

budget for 2 years and Governor Bruce Rauner proposed cutting 

$200 million from the Community Care Program in his budget proposal which is one of the many reasons Illinois hasn’t had a budget. 

In addition to funding for those programs, a high quality personal care workforce is absolutely critical to ensuring that beneficiaries have access to the services they need. As GAO has reported, many of the personal care service programs differ from 

State to State. We know that. And that includes the training or 

lack thereof that service agencies provide to the workforce. In some 

States, training is offered or required, either for new entrants into 

the workforce or for continuing education of existing workers. In 

other States, there’s actually little or no guidance on training or 

continuing education for those workers. 

Mr. Hill, let me ask you, have you investigated what percentage 

of agencies providing personal care services in Medicaid have orientation or training programs that are in place? 

79 

Mr. HILL. So as I sit here, I couldn’t give you statistics by State 

where those requirements lie, which States require that and which 

particular agency. 

Ms. SCHAKOWSKY. Let me ask Ms. Iritani, do you know that or 

either one of you know that? 

Ms. IRITANI. We know that it varies, yes. 

Ms. SCHAKOWSKY. OK. But you don’t know. 

Ms. IRITANI. No. 

Ms. GRIMM. An analysis that we did in 2010, we did find 301 sets 

of qualifications across States. 

Ms. SCHAKOWSKY. OK, and that would include the kind of orientation and training programs? 

Ms. GRIMM. It would include that in the qualifications. 

Ms. SCHAKOWSKY. Back to Mr. Hill. Do you know what percentage—or any of you know what percentage of those specifically educate their employees and what constitutes waste, fraud, or program 

abuse? 

Mr. HILL. As I indicated earlier in response to a question, we 

have issued guidance to States on best practices. While I can’t say 

which States require it as I sit here, I could not tell you which 

States require that level of training. We have identified for States 

that training, particularly around compliance issues, is the best 

practice for attendees. And we would expect that States would require that of particularly the attendant agencies to be sure that the 

folks that are coming into those agencies are properly trained, not 

just for patient safeguards, but also on the compliance side. 

Ms. SCHAKOWSKY. Well, what it seems to me is that the word has 

gone out that this would be important, but nothing has been done 

really to enforce that or to even survey that to find out who’s doing 

exactly what when it comes to worker training. 

Finally, I just want to note that when a worker comes forward 

to report cases of waste, fraud, or neglect on behalf of the personal 

care agency they work for, I really think that it’s critical that they 

are provided whistleblower protections. 

And again, to any of you, I’m just wondering if whistleblower 

protections are built in. 

Mr. HILL. Speaking for CMS—and I’m sure the IG and others 

would have it—we review tips and whistleblower complaints as valuable sources of information as we conduct investigations in concert with our law enforcement partners. I think the whistleblower 

protections vary by State in State law and that’s something that— 

we value those sorts of activities highly, and it’s something that we 

would encourage States to continue to support. 

Ms. SCHAKOWSKY. Well, again, are they protected by law if they 

were to come forward? 

Mr. HILL. On the whistleblower side, I think it’s a State-by-State 

determination as to how the State whistleblower laws apply. 

Ms. SCHAKOWSKY. Well, then let me just say I think we need to 

standardize that because one of the ways that I think that we can 

make the program operate effectively without waste, fraud, and 

abuse is to protect the out front, the upfront workers that are doing 

it because they are the most likely to see it. 

80 

In my experience with those home care workers is that these are 

really dedicated people who are doing often for very little money 

some of the most important work in our country and I yield back. 

Mr. MURPHY. Thank you. I now recognize Mr. Walberg for 5 minutes. 

Mr. WALBERG. Thank you, Mr. Chairman. Thanks to the panel. 

My wife and I were extremely concerned when a personal care 

worker stole a credit card from my mother and that was a deal 

from that point on dealing with the bank and then dealing with the 

court system. But I was disturbed, as I read the released investigative advisory coming from OIG, that there are significant number 

of instances where PCS workers steal painkillers and other medications from their beneficiaries. 

In the case, Ms. Grimm, that you noted in 2016 in Vermont specifically, how did OIG discover that? 

Ms. GRIMM. So Vermont, that involved the husband. It was a 

wife, the beneficiary was a husband and the wife was splitting payments with the care attendant and as part of that scenario she 

would get or he would get pain pills as a form of payment. I don’t 

know how that came into our office, but that was the scenario that 

was uncovered. 

Again, going back to some of the recommendations that we’ve offered, had there been a background check in place, it would have 

revealed a pattern of drug abuse. 

Mr. WALBERG. How often is this happening? Is this a common occurrence that you’re finding? 

Ms. GRIMM. I think fraud is very common in personal care. We’ve 

opened 200 investigations since 2012 and our Medicaid Fraud Control Units, it comprises one third of their criminal convictions and 

have upward of 8,000 cases that have been opened in that time 

frame. 

Mr. WALBERG. Are the painkillers that are stolen generally used 

by the individual themself or are they selling this? 

Ms. GRIMM. We’ve seen patterns of both of them using painkillers for themselves and then also selling those. Drug diversion 

is a big issue in the fraud that we see. 

Mr. WALBERG. Yes, and that’s a concern when we see about the 

opioid problems, etcetera. The OIG recommended establishing some 

minimum Federal qualifications and screening standards for PCS 

workers. What kind of minimum qualifications do you have in 

mind? 

Ms. GRIMM. We have recommended minimum age requirements, 

background checks, and we endorse training. Just to sort of demystify things, all of those things right now are voluntary. They’re 

not something that’s required at the Federal level, so to the extent 

that it’s happening, it’s the State sort of acting on it. It is not currently required at the Federal level. 

Mr. WALBERG. With the screening and the background checks, it 

makes sense to prohibit individuals with felony convictions for 

drug-related crimes and social services fraud. Is that part of your 

recommendation? 

Ms. GRIMM. We have not specified, but there are guidelines in 

place for care workers that have direct interaction with patients in 

81 

the home health context. And I think some good parameters could 

be taken from that context. 

Mr. WALBERG. OK. It seems like that would make sense. 

Mr. Hill, is CMS able to enact stricter standards? 

Mr. HILL. We can certainly regulate. The question is how to regulate. As you know, we issued our request for information last fall, 

asking all the affected stakeholders on these very particular issues 

about whether or not Federal standards for enrollment or background screening or any number of things that the IG has recommended should be put in place. 

As you know, it’s a tension between State flexibility and the 

flexibility of any particular program in terms of who it is and how 

it is they’re overseeing those programs and the imposition of a Federal requirement. So before we were to implement a Federal requirement, we want to be sure that it’s going to meet the needs of 

all the States, both from a program integrity standpoint and also 

from the service delivery standpoint as well. 

Mr. WALBERG. Well, I appreciate that. I guess I would echo some 

of Mr. Collins’ statements as well that it’s time to push. And as you 

indicated as well, the financial push is sometimes the best way to 

get these recommendations dealt with and the States to get on 

board. Because it’s one thing for an elderly lady with dementia to 

lose her credit card. That can be fixed. When you get into in this 

particular area of medications, painkillers, getting out and misused, it impacts lives and maybe get a good handle on that. 

Thank you. I yield back. 

Mr. MURPHY. Thank you. I now recognize Ms. Clarke for 5 minutes. 

Ms. CLARKE. Thank you, Mr. Chairman. Mr. Chairman, I’m glad 

that we’ve had the opportunity to talk about the Medicaid program 

and how many people it helps across the country. Roughly 74 million Americans depend on Medicaid for healthcare coverage and the 

program is a lifeline to these individuals. 

The Affordable Care Act authorized States to expand Medicaid 

for low-income adults, helping to fill a major gap in insurance coverage. As a result, more than 12 million low-income adults were 

able to gain coverage last year. 

As Republicans are contemplating repealing the Affordable Care 

Act’s Medicaid expansion and making sweeping changes to Medicare, I’d like to put this program in context. 

Mr. Hill, CMS has reported that the ACA’s Medicaid expansion 

has helped reduce the rate of uninsured to its lowest level in our 

Nation’s history. Is that correct? 

Mr. HILL. That’s correct. 

Ms. CLARKE. And in a report this past January, CMS stated, and 

I quote, ‘‘Medicaid is the most efficient healthcare program we 

have, covering people at lower costs than commercial insurance 

coverage or even Medicare. And at the same time Medicaid has 

that proven track record of enabling access to care, improving 

health, and helping children succeed in life.’’ 

Mr. Hill, do you agree that Medicaid is an efficient program and 

that is covers people at lower costs than Medicare and commercial 

coverage? 

82 

Mr. HILL. My judgement is that Medicaid is an important program doing a lot of good for the 74 million people that we cover. 

Ms. CLARKE. In CMS’ January report, the Agency stated, ‘‘Research has shown that Medicaid expansion has helped improve 

quality, access, and affordability of care.’’ 

Mr. Hill, can you briefly explain how the Medicaid expansion has 

improved the healthcare coverage of its beneficiaries? 

Mr. HILL. Without speaking directly to the January report, let 

me just say that as a general proposition somebody who is covered, 

whether they’re covered through the marketplace or whether 

they’re covered by their employer, they have coverage through 

Medicaid. If you have health insurance coverage, you generally are 

going to be in a better place vis-a-vis be uninsured, particularly if 

you get sick. 

Ms. CLARKE. So in addition to expanding Medicaid coverage to 

millions, the ACA also created the Community First Choice program. This program encourages more States to offer personal care 

services by providing an additional six percent Federal matching 

payment to these services. Unfortunately, in addition to gutting the 

entire Medicaid program, one provision of Trumpcare would actually repeal this option. 

Ms. Iritani, I understand from your report that States have 

begun to participate in the Community First Choice program, is 

that correct? 

Ms. IRITANI. That’s correct. 

Ms. CLARKE. Can you tell me more about States’ participation in 

this program? 

Ms. IRITANI. Well, we know from our work that eight States, as 

of the time of our report, were participating in the Community 

First Choice program. And one of the concerns we have leading to 

our recommendation about harmonizing requirements is making 

sure that for those people who are in that program who require institutional level of care that the safeguards are in place to ensure 

beneficiaries’ safety are similar to other programs that have served 

similar beneficiaries, because many States are moving their beneficiaries from waiver programs that have really strong or stronger 

safeguards into the Community First Choice program. 

Ms. CLARKE. So you’re saying that the Community First Choice 

program doesn’t have strong safeguards? 

Ms. IRITANI. I think that it doesn’t have the same level of safeguards as others, other programs’ authorities. 

Ms. CLARKE. Are you saying that you believe that that may put 

some of its participants at risk? 

Ms. IRITANI. We recommend that CMS actually needs to harmonize the requirements in place between programs to ensure that 

common risks for beneficiaries, depending on their level of need, 

are addressed in common ways across the programs. 

Ms. CLARKE. And the Community First Choice program, do you 

believe that their services are less than traditional? 

Ms. IRITANI. No, we did not do that work, no. 

Ms. CLARKE. OK. Mr. Chairman, I hope my colleagues recognize 

the importance of this program, how many people rely on Medicaid 

for their insurance. Trumpcare proposes to dismantle the Medicaid 

program as we know it, capping coverage for children, pregnant 

83 

women, individuals with disabilities, and of course, those who have 

gained coverage from the Medicaid expansion, not to mention Medicaid is the primary insurer of long term care services and support 

in this country. 

I hope my colleagues will reflect on that point and the immense 

responsibility we have to strengthen Medicaid and not tear it 

down. And I yield back. 

Mr. MURPHY. Thank you. I now recognize Mr. Costello for 5 minutes. 

Mr. COSTELLO. Thank you, Mr. Chairman. Ms. Grimm, Mr. Hill, 

between 2014 and 2015, the improper payment for personal support services which includes PCS, as you know, nearly doubled 

from 6.3 percent in 2014 to 12.1 percent in 2015. That’s a lot. Why 

did the error rate increase at such a level in your opinion? 

Mr. HILL. So some of it will have to do with measurement, right. 

That’s not necessarily a statistically significant way to measure 

those services. I’m not discounting the fact that there’s an error 

rate meaning to worry about it, but just as a technical matter, it’s 

hard to make comparisons year to year the way the PERM rate is 

put together. 

I also think that the roll out of requirements around requiring 

ordering and referring physicians on claims began to get implemented over that time period. And so while in PCS that may not 

be an issue that category of services you had identified, there are 

claims in there that require ordering the referring physician to be 

on the claim. And I know States have had a struggle coming into 

compliance with that requirement. 

Ms. GRIMM. I missed it, did you say Ms. Iritani or Ms. Grimm? 

I’m sorry. 

Mr. COSTELLO. Ms. Grimm. 

Ms. GRIMM. So the work that we’ve done, so we’ve looked at error 

rates in personal care services across eight States, and we have 

consistently found very high error rates in personal care services. 

Looking at recent information, Missouri, upwards of 47.8 percent 

in error rate; New Jersey, 30.9 percent; New York City, 18 percent. 

And this is consistent across States. So I think the core point there 

is that we do find high error rates in personal care services, so it’s 

unsurprising that the error rate in PERM is what it is for personal 

care. 

Mr. COSTELLO. Thank you. The Electronic Visitation Verification 

piece of the Cures Act I think holds great promise, and I would ask 

you to share, for those watching, the EVV captures exact time, 

date, location, and duration of each visit. 

The question—and there are several, so I’m just going to go 

through them and then open up to all three of you—is, where is 

CMS in the process of implementing that change and how much 

flexibility do States have? How much flexibility should States have 

in how they choose to use EVV? What enforcement mechanisms 

will CMS use to ensure State compliance with implementation by 

2019? Have you see any success stories so far? And finally, how can 

Congress be helpful? 

For GAO and OIG, do you believe EVV implementation will help 

curb fraud and result in more complete, accurate, and timely data 

84 

and do you care to elaborate on any GAO or OIG recommendations 

to ensure smooth EVV implementation? 

So Mr. Hill and then right on down the line with those questions. 

Mr. HILL. Let me take these in turn. In terms of State flexibility 

and what we need to do to implement the provision, as you know, 

the effective date is 2019 with respect to the financing of EVV. And 

so between now and then we’ll be regulating and as part of that 

process we’ll have to make a determination as to how much flexibility, if flexibility is given to States in terms of how we implement. 

So there’s a lot of policy work that we need to do in terms of the 

State flexibility on EVV. 

The enforcement here is withholding FFP. As you know, the statute articulates if the State doesn’t have a program, we can reduce 

the Federal share. In terms of success stories, we know there are 

two States, Missouri and Texas, already who have begun rolling 

out EVV. We’re working with them and learning all we can for how 

those particular States are rolling this out so that we can expand 

those successes and lessons learned in our oversight activity. 

Ms. IRITANI. I can’t speak to the implementation of EVV, but 

what I can speak to are the benefits. We spoke to four States, two 

have EVV in place. They spoke of cost savings when they implemented it, improved timekeeping, more accurate timekeeping, more 

accurate data, and absolving the beneficiary of the responsibility of 

having to record time charges. 

Additionally, EVV can help ensure that there is a process for notifying the agencies if an attendant doesn’t show up. 

Mr. COSTELLO. Have you offered any—will GAO be offering any 

recommendations as it relates to implementation? 

Ms. IRITANI. We don’t have current work on that. 

Ms. GRIMM. Implementation is going to be key. I think that we’ve 

heard that just because the requirement exists doesn’t necessarily 

mean that the data are going to be collected and that they’re going 

to be reported and that there are any usable time or usable way 

to be used. Reduction in—so in that enforcement mechanism, the 

reduction in FMAP for EVVS is also going to be important. The enforcement authority, without the willingness to act on that enforcement authority, I think poses a little bit of an issue. But certainly 

the data that EVVS collects, that verification of services will go a 

very long way. A lot of our fraud schemes show that they’re billing 

for services that were never rendered. 

Mr. COSTELLO. Have you or will you be sharing your recommendations on usability with CMS to make sure that the data 

is in a workable manner for you to be able to audit? 

Ms. GRIMM. We don’t have any work specifically devoted to 

EVVS right now, but we do have a report looking at T–MSIS that 

is very close to completion that will point out issues related to complete list, accuracy, and timeliness. 

Mr. COSTELLO. Thank you. 

Mr. MURPHY. Thank you. I now recognize Ms. Brooks for 5 minutes. 

Ms. BROOKS. Thank you, Mr. Chairman. It was actually 2012 to 

Mr. Collins’ point earlier relying on data, but in 2012 it was when 

HHS Office of Inspector General released the portfolio highlighting 

waste, fraud, and abuse in the PCS program and to date, CMS has 

85 

yet to implement four of the recommendations. And I’m not going 

to list all of them or read through all of them because I want to 

get to the questions, but they include reducing significant variation 

in the State PCS attendant qualifications and improving CMS’ and 

States’ ability to monitor billing and care quality. 

I can go into greater detail if you don’t know which four, but you 

know which four. So rather than spend my time on that since it’s 

been nearly 5 years since these recommendations for improving 

PCS were suggested and while I appreciate that CMS has adopted 

some of the recommendations, there are still these four. 

So Mr. Hill, why has CMS not adopted all of the HHS OIG recommendations after nearly 5 years? And do you disagree with any 

of the recommendations? 

Mr. HILL. So obviously the controls that the recommendations 

are articulating are controls we’d like to see States have in place. 

The question for me is, it’s not—so there are four recommendations, but overarching all of them is CMS is showing a Federal 

standard and regulating here and requiring States and holding 

States accountable to those four standards. And it’s that balance 

that we’re trying to strike here as to whether or not we should regulate and create a Federal standard or whether or not we should 

be allowing States as they are now or requiring States to have 

more stringent standards at the State level. So it’s not a disagreement necessarily with the fact that we ought to have standards for 

attendant qualifications. The question is should that be a Federal 

standard or should that be a standard that’s left to the State with 

us ensuring that the State is following through on that and complying. 

Ms. BROOKS. And while I understand that that’s what the differences are, it’s been 5 years since the recommendation came out 

and so what is the problem? Is there an internal deadline at this 

point for CMS to adopt these recommendations? 

Mr. HILL. So we issued a request for information last fall after 

a lot of conversation with the IG to gather more information on the 

question that I just articulated, in terms of Federal standards or 

not. We’re going through that information and the data that we 

gathered as part of that RFI and we’ll be considering that as we 

move forward in the regulatory agenda for Medicaid generally. 

I should just be very clear, there’s not an internal deadline for 

when we have to have a reg out or not. We’re going through those 

comments now. 

Ms. BROOKS. Would you agree that a lot of people work best 

when there are deadlines? 

Mr. HILL. I do. I understand the point, yes. 

Ms. BROOKS. So that might be something you might consider at 

this point after 5 years is setting a deadline? 

Mr. HILL. I will be sure to raise that. I can’t set the deadlines. 

I’m a deadline follower, but I do report to the folks who set deadlines. 

Ms. BROOKS. And you talked about the qualification issue, what 

about is that a similar problem with respect to the monitoring of 

the billing and care quality? 

86 

Mr. HILL. The data and information on claims, all the controls 

that the IG has quite appropriately identified, we have to regulate 

if we were going to have to require a State to implement those. 

Ms. BROOKS. Ms. Grimm, and so Mr. Hill has talked about have 

there been conversations between OIG and Mr. Hill and others at 

CMS regarding the length of time that’s passed since you’ve issued 

these recommendations and have there been any reasons as to why 

you believe there’s been a delay that we could maybe address in 

implementing the recommendations? 

Ms. GRIMM. We have a number of processes in place for all of our 

unimplemented recommendations to follow up on the status of 

those recommendations. We have met beginning in November 2015 

with CMS leadership in person many times to talk about options 

and possible solutions. 

Ms. BROOKS. So you’re following your processes for following up 

on recommendations. What has been the primary reason for delay 

in moving forward since it’s been years and you’ve been following 

your process since November of ’15? 

Ms. GRIMM. We certainly have provided a lot of technical assistance to CMS. I think that’s a great question for my colleague, Mr. 

Hill. 

Ms. BROOKS. Mr. Hill, so we’ll bring it back to you. 

Mr. HILL. I fear I will not have a satisfactory answer for you to 

be able to say exactly why a reg hasn’t been implemented. As you 

know, we sort of went through sort of a set of conversations last 

year. We’ve now had a transition. We have a new administration 

and we’re beginning to think about what that agenda looks like. 

Ms. BROOKS. I’ll be anxious to see with respect to those that you 

work with at CMS that we’ve set an internal deadline and move 

forward on many of these recommendations. With that I yield back. 

Mr. MURPHY. The gentlelady yields back. And I now recognize 

Mr. Carter for 5 minutes. 

Mr. CARTER. Thank you, Mr. Chairman, and I thank all of you 

for being here. You know, I think we’ve established the fact that 

the personal care services are extremely important. Before I became a member of Congress, I was a practicing pharmacist, so I 

had some experience with this, particularly in the way of medication management and drug therapy. I was also a consultant pharmacist, as well as being a community pharmacist. And one of the 

primary reasons that people are admitted to a nursing home or to 

a personal care home is medication management. It’s one thing 

that we have to be careful of. 

Representative Walberg alluded to some of the abuse and certainly I have witnessed some of the abuse that can take place with 

that, but I’ve also witnessed a lot of the benefit that it can have. 

And the benefit of allowing someone to stay in their home and not 

having to be institutionalized, it’s a great benefit to them personally and it saves money for a lot of us, but obviously, there is a 

lot of room in that particular scenario for abuse and for fraud. And 

it’s difficult. I get it. I understand it’s difficult to identify that and 

hopefully our healthcare professionals such as pharmacists are 

helping us with that. And whenever they might see a trend or a 

tendency there where medication goes missing or someone is not 

getting their medication, maybe a physician can identify why is 

87 

your blood pressure going up, you know? Are you getting your 

blood pressure medication or something and why is your pain level 

going up? Perhaps they’re not getting it like they’re supposed to. 

But nevertheless, I agree it is a good program, but it is a program 

that obviously we wouldn’t have you here today if we weren’t looking into the fraud, the waste, and the abuse that exists in the program. 

I want to start by very quickly talking just about the self-directed Medicaid service models because as I understand it a lot of 

the fraud that’s involving the personal care services is conspiracy, 

if you will, between the PCS and the beneficiary. 

Tell me, Mr. Hill, what has CMS done to combat that? What can 

you do and what’s been beneficial and what’s worked? 

Mr. HILL. So self-direction—I think, particularly for those of us, 

myself included, who have sort of spent a lot of time thinking about 

the medical model and how we do insurance and provide services, 

self-direction is sort of the most out-of-the-envelope way to think 

about how people are getting services. You know, having a beneficiary pick and understand and have a lot more control over who’s 

coming into their home and how that service is being delivered is 

a challenge. Sometimes, as we’ve identified a family member or a 

friend, so there is a range of things that we’ve done to help, not 

just beneficiaries, but States and agencies who are sometimes involved in that model to build in practices and policies to mitigate 

against abuse. 

We’ve talked about training. We’ve talked about compliance work 

with the folks who are doing the service work. Some States—and 

many States—have requirements for enrollment and background 

checks, all of the things that we’ve talked about work in self-direction as well as they’re going to work in agency. But again, because 

the beneficiary will be at the center of that planning, at the center 

of identifying who is coming into their home, the self-directed 

model is one that provides, presents unique challenges. 

Mr. CARTER. Ms. Grimm, let me ask you, it’s my understanding 

that most of the fraud is proven through by showing—most of the 

fraud is by people who have come and actually testified and 

through referrals from individuals who have turned them in, if you 

will. How can Health and Human Services do a better job with 

that? Is there anything? How can we incentivize people to report 

these types of abuse or fraud? 

Ms. GRIMM. I appreciate your question. I think yes, it is true that 

a lot of the fraud that we see is in self-directed models. They’ve 

shored up a number of different requirements for self-directed so 

that things like the flow of cash isn’t as easily sort of shared with 

others. So CMS has taken steps in that regard. But it would be 

easier, consistent with our recommendations for us to know who 

we’re doing business with. Right now, we don’t know the identities 

and the dates and the types of services being provided at the attendant level. So that’s something that I think is critically needed 

for oversight. 

Mr. CARTER. Great. Well, my time is about up. But again, I want 

to stress that I’ve seen the benefits of this program. The benefits 

are good. But I hope that we can do something to address some of 

the problems that we have because I’ve also seen the fraud that exVerDate Mar 15 2010 09:58 Aug 02, 2017 Jkt 037690 PO 00000 Frm 00091 Fmt 6633 Sfmt 6633 I:\115THCONGRESS\115X29MEDICAIDPCSXASKOK071317\115X29MEDICAIDPCSXPDFM
88 

ists in there and it does exist. And trying to get those bad actors 

out is difficult, but we need to get them out. Thank you very much 

and I yield back. 

Mr. MURPHY. The gentleman yields back. I want to thank our 

panel here. This has been very enlightening for us, and I want to 

follow up on my friend and colleague’s recommendation that we 

bring the States in. We would look forward to hearing from you if 

you have suggestions of what States that might be, so we can hear 

about what’s working, what’s not working. And in the meantime, 

please let us know if there’s other things we need to pay attention 

to. 

I thank all of the witnesses and all the Members who participated in today’s hearing. I will remind Members they have 10 business days to submit questions for the record, and I ask that the 

witnesses give us timely responses to those and respond promptly 

to those questions. And with that, this subcommittee is adjourned. 

[Whereupon, at 12:04 p.m., the subcommittee was adjourned.} 

[Material submitted for inclusion in the record follows:] 

89 


TO: 

U.S. HOUSE OF REPRESENTATIVES 

COMMITTEE ON ENERGY AND COMMERCE 

Members, Subcommittee on Oversight and Investigations 

April 28, 2017 

FROM: Committee Majority Staff 

RE: Hearing entitled "Combating Waste, Fraud, and Abuse in Medicaid's Personal 

Care Services Program" 

On May 2, 2017, at 10:15 a.m. in 2322 Rayburn House Office Building, the 

Subcommittee on Oversight and Investigations will hold a hearing entitled "Combating Waste, 

Fraud, and Abuse in Medicaid's Personal Care Services Program." 

Personal Care Services (PCS) is a Medicaid benefit that all 50 states provide to 

beneficiaries. PCS provides important non-medical assistance to people with disabilities, 

individuals with chronic or temporary conditions, and the elderly, and these services are 

available in the beneficiaries' homes. Data suggests that the utilization of PCS services is 

growing rapidly, and Medicaid fee-for-service spending for PCS increased from $12.7 billion in 

2012 to $15 billion in 2015.1 

In recent months, the Department of Health and Human Services (HHS) Office of the 

Inspector General (OIG) and the Government Accountability Office (GAO) have released 

reports indicating fraud, abuse, and mismanagement within Medicaid's PCS program. The 

findings in these reports raise questions about the Centers for Medicare and Medicaid Services' 

(CMS) effectiveness in administering the PCS program, and suggest changes that may be 

necessary to safeguard vulnerable beneficiaries. This hearing will examine three areas of 

concern identified by the OIG and GAO reports: (I) PCS fraud and abuse that directly harms 

beneficiaries, (2) the lack of uniformity in beneficiary safeguards, and (3) poor data collection 

that hampers effective administration and accountability within PCS. 

I. WITNESSES 

• Timothy Hill, Deputy Director, Medicaid and CHIP Services, Centers for Medicare and 

Medicaid Services; 

Christi Grimm, Chief of Staff, Office of Inspector General, Department of Health and 

lluman Services; and 

Katherine Iritani, Director, Health Care, Government Accountability Office. 

1 GOV'TACCOUNTABILTTV OFFICE, GA0-17-169, CMS NEEDS !lETTER DATA TO MONITOR THE PROVISION OF ANO 

SPENDJNG ON PERSONAL CARE SERVICES (20 17). 
90 


Majority Memorandum for May 2, 2017, Subcommittee on Oversight and Investigations Hearing 

Page 2 

II, BACKGROUND 

This hearing will examine the recent work by the HHS OIG and the GAO that highlights 

serious deficiencies in the PCS program. The Committee will also discuss ways to solve the 

problems identified so that CMS can safeguard vulnerable beneficiaries and protect taxpayer 

dollars. 

1. HHS OIG Fraud and Abuse Investigations 

On October 3, 2016, the 010 issued an Investigative Advisory to CMS.2 The Advisory 

summarized Medicaid fraud schemes involving PCS identified by the OIG between November 

2012 and August 2016. The fraud schemes identified by the Advisory built upon those included 

in a 2012 Portfolio on PCS fraud issues that HHS OIG issued to CMS. As the program has 

grown, OIG reports that the increasing volume of fraud involving PCS has become a top 

concern.J OJG further stated that "CMS would help to prevent and quickly detect instances of 

fraud and patient harm and neglect" if it implemented the basic recommendations included in the 

2012 Portfolio.4 

In 2012, the OIG published a PCS Portfolio that presented findings collected from two 

dozen previous OIG audits and hundreds of investigations.s The Portfolio included five 

recommendations for CMS to improve vulnerabilities detected through the OIG's work. These 

recommendations range from requiring states to collect and report PCS data, to requiring 

minimum standards and background checks for those who work as PCS attendants.6 One 

recommendation called for CMS to address six additional unimplemented recommendations 

from previous OIG reports regarding PCS.7 CMS did not implement many ofOIG's important 

recommendations in the intervening years between their release in 2012 and the Advisory issued 

in 2016. 

In the last four years, the OIG has opened over 200 investigations involving PCS fraud 

and associated patient harm across the United States. The October 3, 2016, Advisory describing 

these schemes found "significant vulnerabilities in the PCS program, including a lack of internal 

controls, and that PCS fraud continues to be a persistent problem."s O!G described several of the 

fraud schemes identified through its investigations, such as: 

• Two PCS attendants in Washington State persuaded a beneficiary to sign blank time 

sheets and submitted claims for periods when the beneficiary was out of the country. 

2 INSPECTOR GEN., U.S. DEP'T OF HEALTH & HUMAN SERV., INVESTIGATIVE ADVISORY ON MEDICAID FRAUD AND 

PATIENT HARM INVOLVING PERSONAL CARE SERVICES (20 16). [hereinafter Investigative Advismy] 

) ld 

4/d 

5 INSPECTOR GEN., U.S. DEP'T OF HEALTH & HUMAN SERV., PERSONAL CARE SERVICES: TRENDS, VULNERABILITIES, 

AND RECOMMENDATIONS FOR IMPROVEMENT (20 12). 

6ld 

) ld 

s Investigative AdvisOty~ supra note 2. 
91 


Majority Memorandum for May 2, 2017, Subcommittee on Oversight and Investigations Hearing 

Page 3 

• A PCS agency in Alaska knowingly authorized PCS attendants to submit false time 

sheets, and billed Alaska's Medicaid program for services provided by employees 

who were not legally authorized to bill Alaska Medicaid. 

• A PCS attendant in Illinois submitted claims seeking more than $34,000 for services 

she did not provide. The same attendant received payments for over a year, even 

though she was excluded from all federal health care programs because her nursing 

license was suspended for allegedly diverting controlled substances from her 

employer. 

• A PCS attendant in Missouri submitted claims for providing care to four different 

beneficiaries while working another full-time job. The attendant was paid for 

services, even though her time sheets for more than 130 days indicated she was in two 

places at the same time. 

Most 0 IG fraud investigations are the result of a referral from an individual who has 

personal knowledge of the fraud.9 Currently, states and the federal government do not collect 

enough PCS data, so it is not possible for the OIG to analyze data and detect fraud schemes such 

as suspicious billing patterns. To help curb fraud in PCS and protect vulnerable beneficiaries, 

Congress acted in the Helping Families in Mental Health Crisis Act of2016 (H.R. 2646) to direct 

states to require the use of an electronic visit verification system for Medicaid-provided personal 

care services and home health services.1o Such a system would ensure that services arc verified 

regarding the type of service performed, the individual receiving the service, the date of the 

service, the location of service delivery, the individual providing the service, and the time the 

service begins and ends. This provision ofH.R. 2646 became law as part of the 21st Century 

Cures legislation. 

In addition to fraud, the OIG Advisory found troubling incidents of patient abuse or 

neglect: 

9ld. 

• One beneficiary in Pennsylvania died of exposure to the cold while under the care of 

a PCS attendant, who inexplicably took the beneficiary shopping in downtown 

Philadelphia even though that beneficiary had a developmental disorder and a history 

of running away. 

• A beneficiary in Idaho was hospitalized for severe dehydration and malnourishment 

and was hospitalized after her PCS attendant- her son neglected her care. 

Investigators found the home filthy with drug paraphernalia, trash, and dog feces in 

the home. 

• A PCS attendant in Vermont allegedly arranged to split payments for services with 

the beneficiary's wife, and submitted claims for 456 hours of services that were not 

10 l-l.R. 2646, !14th Cong. (2016). 
92 


Majority Memorandum for May 2, 2017, Subcommittee on Oversight and Investigations Hearing 

Page 4 

provided. The PCS attendant was also allegedly compensated by using the patient's 

prescription opioid painkillers. II 

The OIG notes that beneficiaries-often disabled individuals or the elderly poor-are unable to 

report abuse and harm because of beneficiaries feel beholden to their attendants or have physical 

or cognitive impairments. This makes beneficiary safeguards and strong oversight even more 

important to protect these vulnerable populations. 

2. Uniformity in Beneficiary Safeguards 

In November 2016, the GAO released a report finding a lack of standardized 

requirements for state PCS programs. GAO noted that harmonizing program requirements can 

"improve coordination of program services" and facilitate better oversight on the state and 

federal Jevcls.12 Of the four states audited, GAO found that each state had a different standard for 

beneficiary safeguards, such as attendant screening and training, and beneficiary monitoring. For 

example, while all four states required background checks, the rigor of the background differed 

depending on the state. In California, beneficiaries can hire an attendant even if that attendant 

was convicted of a felony related to social service fraud. In Oregon, some beneficiaries are 

responsible for screening attendants against HHS OIG's list of excluded providers, where the rest 

of the states require that step in addition to a background check. GAO attributed these varying 

standards to a "patchwork of federal requirements" and stated that HHS could act within limits 

of existing law to harmonize these requirements.l3 

3. Insufficient Data on PCS Expenditures 

In January 2017, the GAO released a report finding significant deficiencies in the data 

systems that collect information about the administration of the PCS program.l4 CMS utilizes 

two data systems-MSIS and MBES-to collect data about PCS.1s According to GAO, the 

MSIS data was "not timely. complete or consistent," and only included data for 35 states.16 

Further, the most recent data at the time of GAO's audit was from 2012. The MBES data was 

"not always accurate or complete;" for example, 17 percent of expenditure lines were not 

reported correctly between 2012 and 2015.17 GAO warned that, "without good data, CMS is 

unable to effectively monitor who is providing personal care services or the type, amount, and 

dates ofservices."1s 

11 Investigative Advisory, supra note 2. 

12 GOV'T ACCOUNTABILITY OFFICE, GA0-17-28, CMS COULO DO MORE TO HARMONIZE REQUIREMENTS ACROSS 

PROGRAMS (20 16 ). 

uld. 

14 Gov·T ACCOUNTABILITY OFFICE, GA0-17-169, CMS l\EEDS BETTER DATA TO MONITOR TilE PROVISION OF AND 

SPENDING ON PERSONAL CARE SERVICES (20 17). 

"The MSIS is the Medicaid Statistical Information System, which collects detailed information from provider 

claims on services rendered to individual Medicaid beneficiaries and state payments for these services. The MBES is 

the Medicaid Budget Expenditure System and collects states' total aggregate Medicaid expenditures across 80 broad 

service categories. 

'" GOV'T ACCOUNTABILITY OFFICE, GA0-!7-169, CMS NEEDS BETTER DATA TO MONITOR Till' PROVISION OF AND 

SPENDING ON PERSONAL CARE SERVICES (2017) at 36. 

"!d. at 37. 

"!d. 
93 


Majority Memorandum for May 2, 2017, Subcommittee on Oversight and Investigations Hearing 

Page 5 

III. ISSUES 

The following issues may be examined at the hearing: 

• How does the growth ofPCS increase the risk of fraud? 

• How does coordination in program requirements facilitate better oversight on the state 

and federal levels? 

• What role do states play in ensuring the integrity of the PCS program? 

• What problems can CMS address administratively? 

• How can better data curb waste, fraud and abuse in the Personal Care Services program? 

IV. STAFF CONTACTS 

If you have any questions regarding this hearing, please contact Emily Felder of the 

Committee staff at (202) 225-2927. 
94 


GREG WALDEN, OREGON 

CHAIRMAN 

Ms. Christi Grimm 

Chief of Staff 

FRANK PALLONE, JR, NEW JERSEY 

RANKING MEMBER 

ONE HUNDRED FIFTEENTH CONGRESS 

~ongress of tbc 'mnftcb .i>tatcs 

;l}ouse of l\epw:ientatilJes 

COMMITTEE ON ENERGY AND COMMERCE 

2125 RAYBURN HousE OFFICE BuiLDING 

WASHINGTON, DC 20515-6115 !VIa)Onty (202} 225~292"/ 

Mm011ty !20:?1225<~fi41 

May 31,2017 

Office of Inspector General 

U.S. Department of Health and Human Services 

300 Independence Avenue, S.W. 

Washington, DC 20201 

Dear Ms. Grimm: 

Thank you for appearing before the Subcommittee on Oversight and Investigations on Tuesday, 

May 2, 2017, to testify at the hearing entitled "Combating Waste, Fraud, and Abuse in Medicaid's 

Personal Care Services Program." 

Pursuant to the Rules of the Committee on Energy and Commerce, the hearing record remains 

open for ten business days to permit Members to submit additional questions for the record, which are 

attached. The format of your responses to these questions should be as follows: (l) the name of the 

Member whose question you are addressing, (2) the complete text of the question you are addressing in 

bold, and (3) your answer to that question in plain text. 

To facilitate the printing of the hearing record, please respond to these questions with a 

transmittal letter by the close of business on Wednesday, June 14, 2017. Your responses should be 

mailed to Elena Brennan, Legislative Clerk, Committee on Energy and Commerce, 2125 Rayburn 

House Office Building, Washington, DC 20515 and e-mailed in Word format to 

Elena.Brennan@mail.house.gov. 

Thank you again for your time and effort preparing and delivering testimony before the 

Subcommittee. 

Sincerely, 

Tim Murphy 

~~ 

Chairman 

Subcommittee on Oversight and Investigations 

cc: The Honorable Diana DeGette, Ranking Member, Subcommittee on Oversight and Investigations 

Attachment 
95 


Christi Grimm, Chief of Staff, Office of Inspector General, U.S. Department of Health and Human 

Services, response to questions for the record following "Combating Waste, Fraud, and Abuse in 

Medicaid's Personal Care Services Program" 

The Honorable Tim Murphy: Questions for the Record from the May 2, 2017, hearing before the 

House Committee on Energy and Commerce, Subcommittee on Oversight and Investigations regarding 

Medicaid Personal Care Services. 

1. HHS OIG's 2012 portfolio states that the number of cases in which beneficiaries are committing 

fraud themselves are being charged as co-conspirators with their attendants is growing. Why do 

you think these cases are becoming more common? 

OIG believes that these cases are becoming more common because of the lack of program integrity 

safeguards in the Medicaid Personal Care Services (PCS) program. Unfortunately, individuals intent 

on committing fraud recognize the many policy vulnerabilities in the program and exploit them for 

their benefit. Inadequate controls over items such as reporting and documentation of visits provide 

unscrupulous beneficiaries and their attendants the opportunity to either falsify documents to 

justify billings or not accurately report the services provided because they are not required to do so. 

A separate yet equally important reason for the increase in these types of cases is that beneficiaries 

often feel reliant on or indebted to their attendants for the services they provide, making them 

particularly vulnerable to pressure from ne'er-do-well attendants. This often makes beneficiaries 

reluctant to report any misconduct or fraudulent activity and, in more severe instances, causes them 

to join schemes with their attendants to defraud the PCS program. 

a. While there are upsides of having relatives of beneficiaries be their PCS attendants, there are 

also potentially downsides, such as beneficiary-attendant fraud conspiracies. What are some 

ways in which we can prevent these fraud schemes between beneficiaries and attendants? 

OIG understands the advantages and disadvantages of having friends or relatives serve as PCS 

attendants to beneficiaries and appreciates the Committee's question on ways to prevent these 

fraud schemes. While provisions in recent legislation offer necessary countermeasures, such as 

the Electronic Visit Verification Systems (EVVS), OIG believes the implementation of the 

following recommendations would help further mitigate the risk of beneficiary-attendant fraud 

conspiracies: 

Establish minimum Federal qualifications and screening standards for PCS workers, including 

background checks. 

Require States to enroll or register all PCS attendants and assign them unique numbers. 

Require that PCS claims identify the dates of service and the PCS attendant who provided 

the service. 

These enhanced controls and oversight measures deter fraudulent individuals by limiting their 

opportunities to exploit program vulnerabilities. They provide more information on the services 

rendered and the attendants themselves, facilitate beneficiaries' ability to make sound decisions 

about their care, and enhance States' fraud-fighting efforts through the use of data analytics to 

prevent and detect fraudulent activity. States that have proactively instituted these safeguards 

have seen a dramatic decrease in their programmatic costs. 

1 
96 


Christi Grimm, Chief of Staff, Office of Inspector General, U.S. Department of Health and Human 

Services, response to questions for the record following "Combating Waste, Fraud, and Abuse in 

Medicaid's Personal Care Services Program" 

For example, Alaska now requires all PCS attendants to enroll in the State Medicaid agency. This 

allows the Alaska Medicaid Fraud Control Unit (MFCU) and the Alaska Program Integrity Unit to 

compare and match provider information against other data, such as Medicaid claims. Having 

that provider data available significantly improves their ability to detect fraud schemes and 

investigate bad actors. In a short span of 2 years, that type of data analysis helped support 108 

criminal convictions and led to $5.6 million in restitution. It also had a sentinel effect that 

helped the State reduce its PCS costs from $125 million in 2013 to $85 million in 2015. This is a 

prime example of how program integrity safeguards can prevent fraud schemes and reduce 

program costs through deterrence. 

b. To what degree can Medicaid Fraud Control Units' take action against beneficiaries who are 

complicit in defrauding Medicaid? 

MFCUs do not generally pursue cases against Medicaid beneficiaries because of statutory 

limitations, except when there is a conspiracy involving a Medicaid provider. As a result, there 

are two ways in which a MFCU may pursue or can take action against PCS beneficiaries who are 

part of a conspiracy to commit fraud. First, if the beneficiary is allegedly responsible, whether in 

a formal conspiracy or in some other manner, for causing a PCS company, or PCS caregiver, to 

submit fraudulent claims to the program, the beneficiary may be included as a subject of the 

fraud investigation. Second, if the beneficiary is alleged to have improperly received PCS 

benefits, the MFCU could investigate the allegation of beneficiary fraud, if, again, there is an 

allegation of a conspiracy between the beneficiary and the caregiver or company as the 

"provider" of the services. Of course, for PCS services provided by a family member, fraud 

allegations may commonly involve some type of conspiracy or agreement between the family 

members. 

c. Are there any statutory limitations to investigating or taking legal action with regards to 

beneficiary fraud? 

Yes, there is a statutory rule that generally limits MFCU investigations to Medicaid provider 

fraud or patient abuse or neglect that occurs in Medicaid-funded facilities. This is the reason 

that MFCUs do not generally investigate beneficiary or recipient fraud matters, which are 

handled by other parts of the State or local government. The principal exception to this, as 

explained in the question above, is when there is conspiracy involving a Medicaid provider, such 

as a PCS company or caregiver. 

Although not involving beneficiary fraud, there is a statutory limitation on the ability of MFCUs 

to investigate the abuse or neglect of patients that occur in a home or community-based setting, 

including the physical or financial abuse of an individual receiving personal care services in the 

home. This has been a longstanding concern for OIG as well as for the MFCU community, and 

we have proposed a legislative amendment to address this gap in MFCU authority. MFCUs 

commonly learn about these abuse allegations in the course of their fraud investigations and are 

forced to decline the cases or refer them to other law enforcement agencies. 

2 
97 


Christi Grimm, Chief of Staff, Office of Inspector General, U.S. Department of Health and Human 

Services, response to questions for the record following "Combating Waste, Fraud, and Abuse in 

Medicaid's Personal Care Services Program" 

The Honorable Frank Pallone: Questions for the Record from the May 2, 2017, hearing before the 

House Committee on Energy and Commerce, Subcommittee on Oversight and Investigations regarding 

Medicaid Personal Care Services. 

1. The Medicaid program is designed to give states flexibility to design their programs under broad 

federal guidelines. However, that flexibility can make it difficult to conduct effective oversight 

and ensure that these state programs are adequately serving beneficiaries. 

a. What steps should the Centers for Medicare & Medicaid (CMS) take to address the significant 

variations in State PCS program requirements? 

Variations in State PCS programs exist because of a lack of Federal requirements for PCS and PCS 

attendants. OIG's November 2012 Personal Care Services: Trends, Vulnerabilities, and 

Recommendations for Improvement' (PCS Portfolio) summarized the findings of OIG's body of 

work on PCS and made recommendations to improve program vulnerabilities. Four 

recommendations from the report remain unimplemented and are basic safeguards that would 

begin to address variations across State PCS program requirements: 

• Establish minimum Federal qualifications and screening standards for PCS workers, including 

background checks. 

Require States to enroll or register all PCS attendants and assign them unique numbers. 

Require that PCS claims identify the dates of service and the PCS attendant who provided 

the service. 

Consider whether additional controls are needed to ensure that personal care services are 

allowed under program rules and provided. 

This lack of consistency across and within States regarding the use of internal controls and 

qualifications puts beneficiaries at risk of harm and makes it difficult to effectively pursue fraud 

and abuse in the PCS program. Additionally, the 21st Century Cures Act requires that all States 

implement Electronic Visit Verification Systems (EVVS) for PCS by 2019. This requirement will 

improve States' ability to monitor billing and quality of care for PCS. As the EVVS is 

implemented, it will be important to ensure that the data gathered are complete, accurate, and 

timely. 

1 https:// oig. hhs.gov /reports-a nd-pu bl ications/portfollo/portfolio-12 -12-01. pdf. 

3 
98 


Christi Grimm, Chief of Staff, Office of Inspector General, U.S. Department of Health and Human 

Services, response to questions for the record following "Combating Waste, Fraud, and Abuse in 

Medicaid's Personal Care Services Program" 

2. Your office recently noted that the Department of Health and Human Services, Office of Inspector 

General (HHS-OIG) has, on average, one full-time employee to oversee more than $680 million per 

year in federal health care spending. 

a. How would budget cuts affect the HHS-OIG's ability to conduct vigorous oversight of the 

Medicaid PCS program and of the Medicaid program more broadly? 

Whenever funding decreases for oversight activities, OIG must reassess the number and scope 

of audits, evaluations, and investigations it can conduct. OIG is a people-driven organization, 

and our largest investments are in employees with the skills necessary for effective oversight of 

more than 100 highly complex health and human services programs. Any decrease in OIG's 

oversight activities reduces program oversight. Reductions in oversight funding make it more 

difficult to ensure program integrity and increase the potential for harm to patients and 

recipients of social services. OIG is charged with overseeing the Department's more than $1 

trillion investment in health and human services programs that touch the lives of virtually all 

Americans. Medicaid and CHIP specifically serve more than 74 million enrolled individuals, more 

than any other Federal health care program, and costs are projected to increase by nearly 6 

percent annually beginning in FY 2018 through FY 2025 due to the aging population. Given the 

current size and projected growth of Medicaid, effective oversight would become more 

challenging with fewer resources. We are assessing the impact of a reduced budget on our work 

and will continue to make hard choices to prioritize the most critical oversight needs. We are 

also continuing to review our operations and infrastructure to ensure that we operate as 

efficiently as possible. 

4 
99 


GREG WALDEN. OREGON 

CHAIRMAN 

FRANK PALLONE, JR., NEW JERSEY 

RANKING MEMBER 

ONE HUNDRED FIFTEENTH CONGRESS 

({ongrcss of tbc W.nttcb $tates 

;!)ouge of i\epregentatlbeg 

COMMITTEE ON ENERGY AND COMMERCE 

2125 RAYBURN HousL OFFICE BuiLDING 

WASHINGTON, DC 20515-6115 

Ms. Katherine lritani 

Director, Health Care 

U.S. Government Accountability Office 

441 G Street, N.W. 

Washington, DC 20226 

Dear Ms. lritani: 

Majority ~202) 225-2927 

Mm()rity (202) 225· 36:41 

May 31,2017 

Thank you for appearing before the Subcommittee on Oversight and Investigations on Tuesday, 

May 2 2017, to testify at the hearing entitled "Combating Waste, Fraud, and Abuse in Medicaid's 

Personal Care Services Program." 

Pursuant to the Rules ofthe Committee on Energy and Commerce, the hearing record remains 

open for ten business days to permit Members to submit additional questions for the record, which are 

attached. The format of your responses to these questions should be as follows: (1) the name of the 

Member whose question you are addressing, (2) the complete text of the question you are addressing in 

bold, and (3) your answer to that question in plain text. 

To facilitate the printing of the hearing record, please respond to these questions with a 

transmittal letter by the close of business on Wednesday, June 14, 2017. Your responses should be 

mailed to Elena Brennan, Legislative Clerk, Committee on Energy and Commerce, 2125 Rayburn 

House Office Building, Washington, DC 20515 and e-mailed in Word format to 

Elena.Brennan@mail.house.gov. 

Thank you again for your time and effort preparing and delivering testimony before the 

Subcommittee. 

Sin~~ 

Tim Murphy 

Chaitman 

Subcommittee on Oversight and Investigations 

cc: The Honorable Diana DeGette, Ranking Member, Subcommittee on Oversight and Investigations 

Attachment 
100 


GAO u.s. GOVERNMENT ACCOUNTABILITY OFFICE 

441 G St. N.W. 

Washington, DC 20548 

June 14, 2017 

The Honorable Tim Murphy 

Chairman 

The Honorable Diana DeGette 

Ranking Member 

Subcommittee on Oversight and Investigations 

Committee on Energy and Commerce 

House of Representatives 

This letter responds to your request that we address questions submitted for the record related 

to the May 2, 2017, hearing entitled Combating Waste. Fraud, and Abuse in Medicaid's 

Personal Care Services Program. GAO's responses to these questions are enclosed and are 

based on previous work related to the areas addressed. 

Katherine lritani 

Director, Health Care 

Enclosure 

cc: Emily Felder 

Kevin McAloon 
101 


GAO Responses to Questions for the Record 

Following the Committee's May 2, 2017 Hearing, 

"Combating Waste, Fraud, and Abuse in Medicaid's Personal Care Services Program" 

The Honorable Frank Pallone 

QFR 1a. How do different program requirements affect beneficiary safeguards, as well as 

fiscal oversight? 

Differing federal requirements across the different types of Personal Care Services (PCS) 

programs can result in significant differences in beneficiary safeguards and fiscal oversight: 

Beneficiaries may experience different health and welfare safeguards depending on the 

program in which they are enrolled. For example, in one state we reviewed, the state 

requires quarterly or biannual monitoring of beneficiaries for most of its PCS programs. For 

another program operated under the PCS state plan authority (Social Security Act § 

1905(a)(24), the state requires only annual monitoring contacts. Officials told us that the 

reason for this difference was because, for that type of program, the state was not required 

to provide assurances to the Centers for Medicare & Medicaid Services (CMS) that they 

safeguard beneficiaries' health and welfare. 

States can use different processes for each PCS program to ensure that billed services are 

actually provided, and some state programs may not be subject to any specific federal PCS 

requirements in this regard. For example, in one state we reviewed, steps taken to ensure 

billed services are provided under some types of PCS programs are not required in another 

of the state's programs. The state reported that it used its quality assurance process in 

some of its PCS programs to meet with and verify service delivery with the beneficiary in an 

effort to ensure that billed services are provided. In one PCS program, a supervisor must 

visit the beneficiary and document whether the attendant is delivering the authorized PCS 

tasks, a recommended practice. 1 The state did not apply the same process to another of its 

programs, and federal requirements for this particular program type do not include specific 

requirements that states help ensure that PCS billed services are provided. 

1

Centers for Medicare & Medicaid Services, Increasing Fiscal Protections for Personal Care Services, webinar 

(2016), accessed October 24, 2016, https:llwww.medicaid.gov/medicaidlhcbsldownloadslhcbs-increasing-fiscalprotections-v6.pdf. 
102 


GAO Responses to Questions for the Record 

Following the Committee's May 2, 2017 Hearing, 

"Combating Waste, Fraud, and Abuse in Medicaid's Personal Care Services Program" 

The Honorable Frank Pallone 

QFR 1 b. What steps should CMS take to harmonize requirements across PCS programs? 

CMS's efforts to harmonize personal care services requirements have not addressed the 

significant differences across federal program requirements specific to PCS related to 

beneficiary safety and ensuring that billed services are provided2 We found that how states 

screen, train, and monitor attendants, and ensure billed services are provided, varies, not only 

between states but even within states, by program. In our view, CMS could take a number of 

steps to improve the coordination among and regulation of all PCS programs, such as: 

Analyze requirements across all authorities to identify similarities and differences; 

Solicit input from stakeholders on what PCS requirements should be more consistent or 

coordinated; and 

In view of this information and our findings, consider changes to future guidance that 

would harmonize HCBS and PCS programs by streamlining and making requirements 

more consistent across programs. 

We note that the HHS OIG has observations similar to GAOs. Based on numerous reviews of 

state PCS programs, the HHS OIG recommended that CMS issue regulations to reduce the 

significant variation in states' PCS requirements for documenting claims for payment for 

services, supervision of attendants, and attendant qualification standards. 3 

2

For purposes of this analysis, we reviewed regulations specific to PCS services, which appear at 42 C.F.R. Parts G, 

J, K, and M, as well as any PCS-specific guidance issued by CMS. We did not review regulations or guidance of 

general applicability, such as Medicaid program integrity requirements set forth in 42 C.F.R. part 455, because 

changes to these requirements would affect services beyond those provided under PCS programs. 

3

The OIG listed this recommendation-to reduce the significant variation in states' PCS requirements for 

documenting claims for payment for services and supervision of attendants-among its 25 most crucial 

unimplemented recommendations. The OIG reported that CMS had not yet implemented these recommendations as 

of Apri12016. US Department of Health and Human Services, Office of the Inspector General, Compendium of 

Unimplemented Recommendations (Washington, D.C.: April 2016). 
103 


GREG WALDEN, OREGON 

CHAIRMAN 

Mr. Timothy Hill 

Deputy Director 

FRANK PALLONE, JR., NEW JERSEY 

RANKING MEMBER 

ONE HUNDRED FIFTEENTH CONGRESS 

<teongnss of tbe mlntteb .i>tates 

jt)ou!3t of l\eprt!'l'tntatibts' 

COMMITTEE ON ENERGY AND COMMERCE 

2125 RAYBURN House OFFICE BuiLDING 

WASHINGTON, DC 20515-·6115 M<ljOtt!y 1702) 'nb 2927 

Mmomy 1201) 225-3641 

May 31,2017 

Center for Medicaid and CHIP Services 

Centers for Medicare and Medicaid Services 

U.S. Department of Health and Human Services 

7500 Security Boulevard 

Baltimore, MD 21244 

Dear Mr. Hill; 

Thank you for appearing before the Subcommittee on Oversight and Investigations on Tuesday, 

May 2, 2017, to testify at the hearing entitled "Combating Waste, Fraud, and Abuse is Medicaid's 

Personal Care Services Program." 

Pursuant to the Rules of the Committee on Energy and Commerce, the hearing record remains 

open for ten business days to permit Members to submit additional questions for the record, which are 

attached. The format of your responses to these questions should be as follows: (1) the name of the 

Member whose question you are addressing, (2) the complete text of the question you are addressing in 

bold, and (3) your answer to that question in plain text. 

To facilitate the printing of the hearing record, please respond to these questions with a 

transmittal letter by the close of business on Wednesday, June 14, 2017. Your responses should be 

mailed to Elena Brennan, Legislative Clerk, Committee on Energy and Commerce, 2125 Rayburn 

House Office Building, Washington, DC 205 I 5 and e-mai!ed in Word format to 

Elena.Brennan@mail.house.gov. 

Thank you again for your time and effort preparing and delivering testimony before the 

Subcommittee. 

Sincerely, 

Tim 

~~ Murphy 

Chairman 

Subcommittee on Oversight and Investigations 

cc: The Honorable Diana DeGette, Ranking Member, Subcommittee on Oversight and Investigations 

Attachment 
104 

Æ 


Tim Hill's Hearing on 

"Medicaid Personal Care Services" 

E&CO&I 

May 2, 2017 

Attachment Additional Questions for the Record 

The Honorable Tim Murphy 

1. OIG's investigations found that the most common fraud schemes involve conspiracies 

between PCS attendants and beneficiaries- "OIG has found a growing number of 

instances in which beneficiaries are being changed as co conspirators because they accept 

cash or other benefits in exchange for participating in the fraud." These cases appear to be 

especially relevant when PCS attendants are close with or even related to beneficiaries. Do 

you agree that beneficiary fraud is a growing problem, and that beneficiaries' close 

relationships to their attendants can be a potential cause of that problem? 

a. What are some ways in which CMS can prevent beneficiary fraud'! 

Answer: CMS has taken a number of actions to improve the Medicaid PCS program and to close 

recommendations made by the OIG. We take oversight of state PCS programs seriously and have 

conducted program integrity reviews, as well as provided states with guidance, training and other 

educational resources to enhance their oversight of PCS in their states. As you know, under the 

Medicaid Federal-state partnership, the Federal Government sets forth a policy framework for the 

program and States, who are well-positioned to know what their residents need, have signiJicant 

flexibility to choose options that enable them to deliver high-quality, cost-efficient care for their 

residents. 

CMS recognizes the unique and intimate nature of personal care services, and supports states offering 

self-direction options to beneficiaries to exercise more control over who provides those services to them. 

Many self-direction programs permit beneficiaries to select family members as care providers, and CMS 

and our state partners understand the necessity of ensuring appropriate fraud prevention measures are 

utilized in these programs. 

CMS has also released a request for information to solicit feedback on improvements that could be made 

to personal care services, including what program integrity safeguards states should have in place to 

reduce fraud, waste and abuse. 1 We received hundreds of responses and are now reviewing them to 

determine the best path forward. 

1 https:/ /www. federalregister. &•ov/ documents/20 16/ I I 109120 16-27040/rned icaid-program-reguest -for-information-rfi-federalgovernment-interventions-to-ensure-the