MEDICAID

Data Sets Provide 

Inconsistent Picture 

of Expenditures

Report to the Ranking Member, 

Committee on Finance, U.S. Senate

October 2012

GAO-13-47

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United States Government Accountability Office

GAO
United States Government Accountability Office

Highlights of GAO-13-47, a report to the 

Ranking Member, Committee on Finance, 

U.S. Senate

October 2012

MEDICAID

Data Sets Provide Inconsistent Picture of 

Expenditures

Why GAO Did This Study

CMS, within the Department of Health 

and Human Services, and state 

Medicaid agencies jointly administer 

the multibillion-dollar Medicaid 

program, which finances health care 

for certain low-income individuals. 

Medicaid is on GAO’s high-risk list 

because of vulnerabilities to waste, 

fraud, abuse, and mismanagement. 

CMS has two data sets that report 

state Medicaid expenditures. The 

MSIS data set is designed to report 

individual beneficiary claims data. The 

CMS-64 data set aggregates states’ 

expenditures, which are used to 

reimburse the states for their Medicaid 

expenditures. However, neither data 

set provides a complete picture of 

Medicaid expenditures.

GAO was asked to compare MSIS and 

CMS-64 data. This report (1) examines 

the extent to which MSIS and CMS-64 

expenditure data differ and (2) where 

possible, quantifies the identified 

differences between the two data sets. 

GAO reviewed documents, compared 

Medicaid expenditure data, and 

interviewed CMS and state officials. 

GAO used fiscal years 2007 through 

2009 data—the most-recent and mostcomplete data available.

What GAO Found

Medicaid expenditures in the Medicaid Statistical Information System (MSIS) were 

generally less than CMS-64 amounts. National expenditures in MSIS were 86, 87, 

and 88 percent of the amounts in CMS-64 in fiscal years 2007 through 2009, 

respectively. In fiscal year 2009, MSIS expenditures for states ranged from 59 to 

119 percent of CMS-64. Specifically, 40 states reported lower expenditures in 

MSIS than CMS-64; 5 states and the District of Columbia reported higher 

expenditures; and 5 states reported similar levels of expenditures. 

Total Medicaid Expenditures in MSIS and CMS-64, Fiscal Years 2007-2009

Fiscal 

year

MSIS 

expenditures 

(dollars in billions)

CMS-64 

expenditures 

(dollars in billions)

Difference between 

MSIS and CMS-64 

(dollars in billions)

MSIS as a 

percentage of 

CMS-64 expenditures 

2007 $273.9 $320.1 $46.1 86%

2008 294.2 338.6 44.4 87

2009 323.1 366.5 43.4 88

Source: GAO analysis of Centers for Medicare & Medicaid Services’ data.

Note: MSIS and CMS-64 expenditures were rounded. 

GAO was able to quantify some, but not all, of the identified differences in 

expenditures between MSIS and the CMS-64.

• GAO adjusted MSIS for expenditures that were not attributed to individual 

beneficiaries—such as prescription drug rebates. These adjustments 

increased MSIS to 92, 93, and 94 percent of the amounts in CMS-64 in fiscal 

years 2007 through 2009, respectively.

• GAO could not account for the remaining differences in part because of 

inconsistencies in the Centers for Medicare & Medicaid (CMS) guidance 

between the two data sets. For example, CMS officials explained that 

expenditures for inpatient services as reported by a state in MSIS and as 

reported in CMS-64 are not necessarily for the same services.

GAO also found that states do not submit timely MSIS information. CMS requires 

states to submit MSIS data within 45 days and CMS-64 data within 30 days of the 

end of the quarter. However, states’ reporting of MSIS data can be up to 

3 years late, whereas CMS-64 data are consistently reported on time. Also, MSIS 

expenditure data are considered less reliable when compared with CMS-64.

GAO has reported that CMS will need more reliable data for assessing 

expenditures and measuring performance in the Medicaid program. MSIS and 

CMS-64 have the potential to offer a robust view of the Medicaid program, 

enhancing CMS oversight of aggregate spending trends, per beneficiary spending 

growth, and cross-state comparisons, all of which could be useful in improving the 

financial integrity of this high-risk program. However, delays in reporting MSIS 

data and inconsistencies between the two data sets limit their usefulness as 

oversight tools. CMS has recently completed a pilot study aimed in part at 

improving the timeliness and consistency of both systems data.

HHS provided technical comments on a draft of this report, which were 

incorporated as appropriate.

View GAO-13-47. For more information, 

contact Carolyn L. Yocom at (202) 512-7114 

or yocomc@gao.gov.
Page i GAO-13-47 Medicaid Data

Letter 1 

Background 5

MSIS Medicaid Expenditures Amounts Are Generally Less than 

CMS-64 Expenditure Amounts 8

Some Factors Could Be Quantified and Accounted for 

Approximately Half of the Expenditure Difference between the 

Data Sets 13

Concluding Observations 27

Agency Comments 28

Appendix I Scope and Methodology 30

Appendix II Total Baseline Medicaid Expenditures in MSIS and CMS-64, 

by State, Fiscal Year 2009 41

Appendix III Total Adjusted Medicaid Expenditures in MSIS and CMS-64, 

by State, Fiscal Year 2009 43

Appendix IV Adjusted MSIS Expenditures as a Percentage of CMS-64, 

by State, Fiscal Year 2009 45

Appendix V Adjusted MSIS Expenditures as a Percentage of CMS-64, 

by State and Expenditure Category, Fiscal Year 2009 46

Appendix VI GAO Contact and Staff Acknowledgments 49

Related GAO Products 50

Contents
Page ii GAO-13-47 Medicaid Data

Tables

Table 1: Total Medicaid Expenditures in the Medicaid Statistical 

Information System (MSIS) and CMS-64, Fiscal Years 2007-

2009 9

Table 2: Total Medicaid Expenditures Adjusted in the Medicaid 

Statistical Information System (MSIS) and CMS-64, Fiscal 

Years 2007–2009 14

Table 3: Medicaid Statistical Information System (MSIS) and CMS64 Service Types, Fiscal Years 2007–2009 34

Table 4: Combined Expenditure Categories and Corresponding 

MSIS and CMS-64 Service Types 36

Figures

Figure 1: Medicaid Statistical Information System (MSIS) Medicaid 

Expenditures as a Percentage of CMS-64 Expenditures, by 

State, Fiscal Year 2009 10

Figure 2: MSIS Medicaid Expenditures as a Percentage of CMS-64 

Expenditures, by Expenditure Category, Fiscal Years 

2007–2009 12

Figure 3: MSIS Medicaid Expenditures as a Percentage of CMS-64 

Expenditures, by Expenditure Category, Fiscal Year 2009 13

Figure 4: Comparison of MSIS Baseline to Adjusted Expenditures, 

by Expenditure Category, as a Percentage of CMS-64, 

Fiscal Year 2009 17

Figure 5: Comparison of MSIS Baseline to MSIS Adjusted 

Expenditures, as a Percentage of CMS-64, Fiscal Year 

2009 18

Figure 6: Comparison of MSIS Baseline to Adjusted Medicaid 

Expenditures, as a Percentage of CMS-64, by State, Fiscal 

Year 2009 19

Figure 7: Adjusted Medicaid Expenditures in MSIS as a Percentage 

of CMS-64, by Expenditure Category, Fiscal Years 2007–

2009 22
Page iii GAO-13-47 Medicaid Data

Abbreviations

CHIP Children’s Health Insurance Program

CMS Centers for Medicare & Medicaid Services

DSH Disproportionate Share Hospital

FPL federal poverty level

HCERA Health Care and Education Reconciliation Act of 

 2010

HHS Department of Health and Human Services 

LTSS long-term support services

M-CHIP Medicaid Expansion Children’s Health Insurance 

 Program

MSIS Medicaid Statistical Information System

PPACA Patient Protection and Affordable Care Act

S-CHIP Separate Children’s Health Insurance Program

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Page 1 GAO-13-47 Medicaid Data

United States Government Accountability Office

Washington, DC 20548

October 29, 2012

The Honorable Orrin Hatch

Ranking Member

Committee on Finance

United States Senate

Dear Senator Hatch:

The Centers for Medicare & Medicaid Services (CMS), within the 

Department of Health and Human Services (HHS), and state Medicaid 

agencies jointly administer the multibillion-dollar Medicaid program, which 

finances health care for approximately 67 million low-income individuals 

who meet specific eligibility criteria. In recent years, the Medicaid program 

has undergone steady growth and is expected to continue to expand in 

light of the Patient Protection and Affordable Care Act of 2010 (PPACA).1

PPACA expands eligibility for Medicaid to nonelderly individuals whose 

income does not exceed 133 percent of the federal poverty level (FPL),2

or $30,700 for a family of four in 2012.3 However, because states may 

choose not to participate in the PPACA expansion, it is unclear how much 

the Medicaid program will grow.4

 

1

Pub. L. No. 111-148, 124 Stat. 119, as amended by the Health Care and Education 

Reconciliation Act of 2010 (HCERA), Pub. L. No. 111-152, 124 Stat. 1029. For purposes 

of this report, references to PPACA include the amendments made by HCERA.

2

PPACA § 2001(a)(1), 124 Stat. 271. 

3

We use FPL to refer to federal poverty guidelines issued by HHS each year in the 

Federal Register. These guidelines provide income thresholds that vary by family size and 

for certain states, and which are updated using the Consumer Price Index.

4

Under the Medicaid program, failure by a state to comply with federal requirements may 

result in a termination of federal Medicaid matching funds. However, the U.S. Supreme 

Court has ruled that states that choose not to expand Medicaid eligibility to these newly 

eligible individuals under PPACA will forgoe only the matching funds associated with such 

expanded coverage. See National Federation of Independent Business, et al., vs. 

Sebelius, Sec. of Health and Human Services, et al., 567 U.S. __, 2012 WL 2427810 

(U.S. June 28, 2012). Prior to the Supreme Court decision, the CMS Actuary estimated 

the PPACA Medicaid expansion would enroll an additional 15 million individuals in 2014. 

However, in July 2012 the Congressional Budget Office estimated that an additional 

7 million individuals would enroll in Medicaid and the Children’s Health Insurance Program 

(CHIP) in 2014.

 
 

Page 2 GAO-13-47 Medicaid Data

Medicaid is on our high-risk list in part because of concerns about the 

adequacy of fiscal oversight, which is necessary to prevent inappropriate 

spending.5 We have previously reported that Medicaid has among the 

highest estimated improper payments of any federal program reporting 

such data. Consequently, we have reported that, particularly as PPACA is 

implemented, CMS will need new tools and resources, including more

reliable data for assessing expenditures and measuring performance.6

CMS has two data sets that report state Medicaid expenditures, but the 

data sets have different purposes and limitations. Consequently, neither 

data set provides a complete picture of Medicaid expenditures.

• The Medicaid Statistical Information System (MSIS) was established 

as a national eligibility and claims data set, and can provide CMS a 

summary of expenditures linked to specific beneficiaries on the basis 

of their medical claims for care.7 CMS reviews these data for 

reliability, and uses these data for policy analysis, program utilization, 

and forecasting expenditures. However, these data exclude other 

aspects of the Medicaid program that are not tied to specific 

beneficiaries. For example, the MSIS data set does not contain 

supplemental payments to providers that are separate from standard 

Medicaid payments for services.

• The CMS-64 data set aggregates states’ expenditures, which are 

used to reimburse the states for their federal shares of Medicaid 

expenditures.8

 

5

Our list identifies areas that are at high risk because of their greater vulnerabilities to 

waste, fraud, abuse, and mismanagement or major challenges associated with their 

economy, efficiency, or effectiveness. 

CMS reviews these submissions, and the data are the 

6

See GAO, High-Risk Series: An Update, GAO-11-278 (Washington, D.C.: February 

2011).

7

States are required to have in operation a mechanized claims-processing and 

information-retrieval system based on certain federal requirements. See 42 U.S.C. 

§ 1396b(r). For all claims filed on or after January 1, 1999, states have been required to 

electronically transmit claims data, including detailed individual enrollee encounter data in 

a format consistent with MSIS. See 42 U.S.C. § 1396b(r)(1)(F).

8

For purposes of this report, we refer to form CMS-64 as “CMS-64.” The form CMS-64 is 

titled the Quarterly Medicaid Statement of Expenditures for the Medical Assistance 

Program. The information is stored in a data set called the Medicaid Budget and 

Expenditure System. States are required to submit aggregate total quarterly Medicaid 

expenditures on the form CMS-64 no later than 30 days after the end of each quarter. 

42 C.F.R. § 430.30 (2011).
 

Page 3 GAO-13-47 Medicaid Data

most-reliable accounting of total Medicaid expenditures. However, 

these data exclude beneficiary-specific data and thus have limited use 

in examining program spending. For example, CMS cannot use 

CMS-64 data to conduct a beneficiary-level analysis to identify 

program spending abuses in particular service areas, such as 

prescription drugs.9

Total Medicaid expenditure data, nationally and by state, often differ 

widely between MSIS and CMS-64, even after accounting for differences 

between the two in the purpose of the database and the type of 

information provided. Members of Congress, industry experts, and 

researchers have noted that these two sets of expenditure data cannot be 

easily reconciled, thus limiting CMS oversight. For example, differences in 

expenditure data between the two data sets limit CMS’s ability to conduct 

cross-state comparisons of Medicaid spending. Such comparisons could 

be used to analyze Medicaid spending patterns by eligibility group and 

other enrollee characteristics that could be useful in improving the 

financial integrity of this high-risk program. To better understand the 

strengths and limitations of federal data on Medicaid expenditures, you 

requested that we study the similarities and differences between MSIS 

and CMS-64. In this report, we (1) examine the extent to which MSIS and 

CMS-64 data on Medicaid expenditures differ nationally, by state, and by 

expenditure category for fiscal years 2007 through 2009; and (2) where 

possible, quantify identified differences between these two data sets.

To determine the extent to which data on Medicaid expenditures differ, 

we examined CMS data on total Medicaid expenditures, as reported by 

states in MSIS and CMS-64, nationally, by state, and by expenditure 

category for fiscal years 2007 through 2009.10

 

9

See GAO, Foster Children: HHS Guidance Could Help States Improve Oversight of 

Psychotropic Prescriptions, 

We used these fiscal years 

because they were the most-recent and most-complete data available at 

the time of our analysis. We examined total MSIS and CMS-64 

expenditures, nationally and by state, by comparing the expenditures 

reported by states in MSIS as a percentage of those reported in CMS-64. 

GAO-12-201 (Washington, D.C.: Dec. 14, 2011).

10In this report, we use the term “state” to refer to the 50 states and the District of 

Columbia. We do not include Medicaid administrative expenditures, state collections, or 

expenditures from Puerto Rico or the U.S. territories of American Samoa, Guam, the 

Northern Mariana Islands, or the U.S. Virgin Islands (which have Medicaid programs) 

because they were not reported in MSIS during fiscal years 2007 through 2009.
 

Page 4 GAO-13-47 Medicaid Data

We provide results for fiscal years 2007 through 2009, and provide 

additional detail for the most recent year available, fiscal year 2009. We 

also combined the individual service types in MSIS and CMS-64 into six 

combined expenditure categories.11

To examine and, where possible, quantify the identified differences 

between MSIS and CMS-64 data, we identified and analyzed differences 

in the types of expenditures included in each data set. Where possible, 

we adjusted the MSIS expenditures on the basis of the differences we 

identified, adding expenditures reported in CMS-64 that were not reported 

in MSIS to obtain total adjusted expenditures for MSIS. We then took the 

total adjusted expenditures nationally, and by state, and calculated the 

expenditures reported in MSIS as a percentage of those reported in 

CMS-64. We also compared adjusted expenditures by combining 

expenditure categories, nationally and by state. We identified additional 

factors that accounted for differences between the two data sets, but 

could not be quantified.

This was necessary because, in 

many instances, there is not a one-to-one match of service types in MSIS 

and CMS-64. As a result, we were able to report on expenditures by 

combined expenditure categories, and thereby better identify the factors 

that account for the differences between MSIS and CMS-64. We 

compared expenditures by combined expenditure categories nationally 

and by state.

For both objectives, we reviewed relevant guidance and documentation, 

including CMS forms and data dictionaries, and also interviewed CMS 

officials and other experts familiar with Medicaid expenditure data. We 

reviewed the data for reasonableness and consistency, including 

screening for missing data, outliers, and obvious errors. We also 

interviewed CMS officials about steps they take to ensure data reliability. 

We determined that these data were sufficiently reliable for our purposes. 

We also interviewed a judgmental sample of state Medicaid agencies to 

help illustrate specific factors that account for the differences in reported 

Medicaid expenditures. We chose the judgmental sample on the basis of 

 

11While we are matching services between these two data sets, some of the expenditures 

we describe here are not directly tied to a Medicaid service in MSIS, such as Medicaid 

payments for Medicare premiums. Other examples of individual service types are inpatient 

hospital, nursing facility, transportation, and rural health clinic screenings. Our six 

combined expenditure categories are (1) hospital, (2) acute and long-term support 

services—noninstitutional, (3) drugs, (4) managed care and Medicaid premium 

assistance, (5) long-term support services—institutional, and (6) Medicare.
 

Page 5 GAO-13-47 Medicaid Data

a variety of criteria using the most-recent and most-complete data 

available, including the size of their total adjusted Medicaid expenditures, 

adjusted MSIS expenditures as a percentage of CMS-64 expenditures, 

and geographic variation. A detailed discussion of our scope and 

methodology is presented in appendix I.

We conducted this performance audit from March 2012 through 

September 2012 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 a health care program jointly funded by the federal 

government and states to provide care for certain low-income individuals. 

The federal government oversees states’ Medicaid programs, and 

typically pays from 50 to 83 percent of each state’s allowable Medicaid 

costs.12 Medicaid enrollees are entitled to receive a range of medical 

services, including hospital care, physician services, laboratory and other 

diagnostic tests, prescription drugs, dental care, and long-term care 

services. In addition, Medicaid provides assistance to low-income elderly 

individuals who are also eligible for Medicare, called “dual eligibles.”13

This assistance can include covering Medicare premiums and cost 

sharing.

 

12In general, state Medicaid spending is matched by the federal government at a rate that 

is based, in part, on each state’s per capita income according to a formula established by 

law. The federal share of Medicaid expenditures, known as the federal medical assistance 

program, typically ranges from 50 to 83 percent. The federal government pays a larger 

portion of Medicaid expenditures in states with low per-capita income relative to the 

national average, and a smaller portion for states with higher per-capita incomes. In fiscal 

year 2012, the largest federal portion was 74.18 percent.

13Medicare is the federal health insurance program that covers seniors aged 65 and older, 

and some disabled persons.

Background 
 

Page 6 GAO-13-47 Medicaid Data

MSIS is a national Medicaid eligibility and claims data set, and is the 

federal source of Medicaid expenditure data that can be linked to a 

specific enrollee. State Medicaid agencies are required to provide CMS, 

through MSIS, quarterly electronic files approximately 45 days after a 

quarter has ended. These files contain: (1) persons covered by Medicaid, 

known as “eligible files”; and (2) adjudicated claims, known as the “paid 

claims file,” for medical services reimbursed by the Medicaid program. 

Each state’s eligible file contains one record for each person covered by 

Medicaid for at least 1 day during the reporting quarter. Individual eligible 

files consist of demographic and monthly enrollment data. Paid claims 

files contain information on medical service-related claims and capitation 

payments.14

MSIS data include enrollees’ eligibility status for Medicaid and the 

Children’s Health Insurance Program (CHIP), types of services received 

by enrollees, and expenditure data. MSIS data are used for policy 

analysis, program utilization, and forecasting expenditures. However, 

MSIS data are not used to determine the federal share of Medicaid 

expenditures, and are not used by the states to manage the daily 

operations of their Medicaid programs.

The CMS-64 data set contains program-benefit costs and administrative 

expenses that are not linked to individual enrollees. State Medicaid 

agencies submit this information 30 days after a quarter has ended by 

means of the Quarterly Medicaid Statement of Expenditures for the 

Medical Assistance Program—also known as the form CMS-64—within 

the Medicaid Budget and Expenditure System. CMS-64 data are reported 

at a state aggregate level, such as a state’s total expenditures for such 

categories as inpatient hospital services and prescription drugs. 

Therefore, unlike MSIS, these data do not include individual expenditure 

data on the state’s enrollees or the services they received under 

Medicaid. Also unlike MSIS, CMS-64 contains expenditures that are not 

linked to specific enrollees, such as supplemental payments including 

Disproportionate Share Hospital (DSH) payments.15

 

14Capitation payments are specified amounts of money paid to a health plan or doctor. 

These payments are used to cover the cost of a health plan member’s health care 

services for a certain length of time.

CMS-64 data are the 

15DSH payments are required to be made to hospitals that serve a disproportionate share 

of low-income and Medicaid patients to help offset hospitals’ uncompensated costs for 

serving these individuals. See 42 U.S.C. §§ 1396a(a)(13)(A)(iv) and 1396r-4.

Medicaid Expenditure 

Data
 

Page 7 GAO-13-47 Medicaid Data

most-reliable and most-comprehensive information on Medicaid 

spending. Agency officials review expenditures submitted through 

CMS-64, and use the data to compute the federal financial participation 

for each state’s Medicaid program costs.

Our reports have demonstrated the need for CMS to improve its oversight 

of this growing, complex program. In particular, federal internal-control 

standards, as documented in GAO’s Standards for Internal Control in the 

Federal Government, state that program managers need both operational 

and financial data to determine whether they are meeting their goals for 

accountability and efficient use of resources in order to make operating 

decisions, monitor performance, and allocate resources. Pertinent 

information should be identified, captured, and distributed in a form and 

time frame that permits people to perform their duties efficiently.16 These 

reports have also identified shortcomings with the MSIS and CMS-64 

data sets, particularly in two areas: Medicaid program integrity and 

supplemental payments.17

We recently issued a report that found that the majority of CMS’s 

Medicaid Integrity Group audits through February 2012 relied on MSIS 

data, although CMS officials told us that they recently reduced their

reliance on MSIS data for these audits.

18

 

16GAO, Internal Control: Standards for Internal Control in the Federal Government, 

We noted that MSIS is an 

extract of states’ claims data and is missing key elements, such as 

provider names, that are necessary for auditing. Furthermore, we found 

that the median amount of the potential overpayment identified in MSIS 

was relatively small compared with other types of audits that used statebased data sets. We recommended, and HHS partially concurred, that 

the CMS Administrator ensure that the program-integrity group’s update 

of its comprehensive plan provide key details about the audit program, 

GAO/AIMD-00-21.3.1 (Washington, D.C.: November 1999).

17In addition to studies regarding Medicaid program integrity and supplemental payments, 

as discussed below, our high-risk report also indicated that Medicaid demonstration 

projects were an area of concern. See GAO-11-278. 

18See GAO, National Medicaid Audit Programs: CMS Should Improve Reporting and 

Focus on Audit Collaboration with States, GAO-12-627 (Washington, D.C.: June 14, 

2012).

Medicaid: A High-Risk 

Program
 

Page 8 GAO-13-47 Medicaid Data

including its expenditures and audit outcomes, program improvements, 

and plans for effectively monitoring the program.

We also recently reported that the accountability and transparency of 

supplemental payments have been lacking using CMS-64.19 Specifically, 

our work found that states reported $32 billion in DSH and non-DSH 

Medicaid supplemental payments during fiscal year 2010. However, the 

exact amount of supplemental payments is unknown using CMS-64 

because not all states reported their non-DSH supplemental payments 

separately from their regular payments. In an earlier report, we also found 

that information on non-DSH supplemental payments was incomplete 

because states did not provide full information to CMS regarding these 

payments. We noted that until reliable and complete information on 

states’ supplemental payments is available, federal officials overseeing 

the program and others will lack the information they need to review 

payments and ensure that they are appropriately spent for Medicaid 

purposes.

MSIS Medicaid expenditure amounts nationwide were generally less than 

CMS-64 amounts. For fiscal years 2007, 2008, and 2009, total 

expenditures based on MSIS data for the nation were 86, 87, and 

88 percent, respectively, of the amounts shown in CMS-64. In fiscal years 

2007 through 2009, the difference in Medicaid expenditures between the 

two data sets decreased from about $46 billion in fiscal year 2007 to 

$43 billion in fiscal year 2009. For fiscal year 2009, the most-recent and 

most-complete data available, MSIS showed $323 billion in total 

expenditures compared with the $366 billion in CMS-64, a difference of 

$43 billion. (See table 1.)

 

19Supplemental payments are payments separate from and in addition to those made at a 

state’s standard Medicaid payment rate and include DSH payments. DSH payments are 

made to hospitals that treat large numbers of Medicaid and uninsured individuals. Other 

supplemental payments, or non-DSH payments, are made to providers above the 

standard Medicaid payment rates but within the Upper Payment Limit, which is the 

estimated amount that Medicare pays for comparable services. States have made nonDSH supplemental payments to hospitals, nursing homes, physician groups, and other 

Medicaid providers. See GAO, Medicaid: States Reported Billions More in Supplemental 

Payments in Recent Years, GAO-12-694 (Washington, D.C.: July 20, 2012) and Medicaid:

CMS Needs More Information on the Billions of Dollars Spent on Supplemental Payments, 

GAO-08-614 (Washington, D.C.: May 30, 2008).

MSIS Medicaid 

Expenditures 

Amounts Are 

Generally Less than 

CMS-64 Expenditure 

Amounts 
 

Page 9 GAO-13-47 Medicaid Data

Table 1: Total Medicaid Expenditures in the Medicaid Statistical Information System (MSIS) and CMS-64, Fiscal Years 2007-

2009

Fiscal year MSIS baseline (dollars) CMS-64 baseline (dollars)

Difference between 

MSIS baseline and 

CMS-64 baseline (dollars)

MSIS baseline as a 

percentage of 

CMS-64 (percent) 

2007 $273,925,484,790 $320,052,492,375 $46,127,007,585 86%

2008 294,167,348,289 338,552,036,761 44,384,688,472 87

2009 323,120,029,363 366,486,147,093 43,366,117,730 88

Source: GAO analysis of Centers for Medicare & Medicaid Services’ data.

MSIS Medicaid expenditures for individual states were generally less than 

CMS-64 amounts. In fiscal years 2007 through 2009, states’ MSIS 

Medicaid expenditures ranged from 59 percent to 120 percent compared 

with CMS-64. In fiscal year 2009 alone, states’ MSIS Medicaid 

expenditures ranged from 59 to 119 percent of those in CMS-64. (See 

fig. 1.) Specifically, MSIS Medicaid expenditures were less than CMS-64 

amounts in 40 states. These expenditures were greater than CMS-64 

expenditures in 6 states, and were similar to CMS-64 expenditures in 

5 states.20

 

20For purposes of this report, we defined “similar” to include MSIS expenditures within 98 

to 102 percent of CMS-64 expenditures.

See appendix II for a table of total baseline state expenditures 

reported in MSIS and CMS-64 by dollar amount in fiscal year 2009.
 

Page 10 GAO-13-47 Medicaid Data

Figure 1: Medicaid Statistical Information System (MSIS) Medicaid Expenditures as a Percentage of CMS-64 Expenditures, by 

State, Fiscal Year 2009
 

Page 11 GAO-13-47 Medicaid Data

We found differences in Medicaid expenditures between the two data sets 

when we combined MSIS and CMS-64 services types into our six 

combined expenditure categories: (1) hospital, (2) acute or long-term 

support services (LTSS)-noninstitutional, (3) prescription drugs, 

(4) managed care and Medicaid premium assistance, (5) LTSSinstitutional, and (6) Medicare.21 For example, MSIS Medicaid 

expenditure data in the hospital expenditure category were less than the 

amounts shown in CMS-64, at 61, 62, and 60 percent, respectively, for 

fiscal years 2007, 2008, and 2009. Conversely, MSIS Medicaid 

expenditures related to the prescription-drug category were greater than 

the amounts shown in CMS-64 data, at 147, 154, and 161 percent for the 

same period. During this time, states did not report expenditures for 

Medicare premiums in MSIS. However, expenditures associated with 

Medicare coinsurance and deductibles were reported under individual 

services throughout MSIS and therefore not identified as Medicare 

expenditures. As a result, MSIS expenditures as a percent of CMS-64 in 

the Medicare category are reported as 0 percent. (See fig. 2.)

 

21Medicaid provides assistance to low-income elderly individuals who are also eligible for 

Medicare, called “dual eligibles.” This assistance can include covering Medicare premiums 

and cost sharing.
 

Page 12 GAO-13-47 Medicaid Data

Figure 2: MSIS Medicaid Expenditures as a Percentage of CMS-64 Expenditures, by Expenditure Category, Fiscal Years 2007–

2009

Note: LTSS stands for long-term support services.

a

The Medicare expenditure category is reported at $0 in the Medicaid Statistical Information System 

(MSIS). During this period, states did not report expenditures for Medicare premiums in MSIS. 

However, expenditures associated with Medicare coinsurance and deductibles were reported under 

individual services throughout MSIS and therefore not identified as a Medicare expenditure.

For fiscal year 2009, Medicaid expenditures in MSIS were lower than 

CMS-64 for four of the six expenditure categories: hospital, acute and 

LTSS-noninstitutional, LTSS-institutional, and Medicare. The hospital, 

prescription drugs, and Medicare categories showed the largest 

difference between what was reported in MSIS compared with CMS-64, 

for fiscal year 2009. In particular, Medicaid hospital expenditures in MSIS 

were 60 percent of those reported in CMS-64, in fiscal year 2009. 

Medicare expenditures were reported as $0 in MSIS, compared with 

$12 billion in CMS-64. For the remaining two categories, prescription drug 

expenditures in MSIS were 61 percent larger in MSIS than in CMS-64, 

while managed care and Medicaid premium assistance MSIS 

expenditures were similar to those in CMS-64. (See fig. 3.)
 

Page 13 GAO-13-47 Medicaid Data

Figure 3: MSIS Medicaid Expenditures as a Percentage of CMS-64 Expenditures, by Expenditure Category, Fiscal Year 2009

Note: LTSS stands for long-term support services.

a

The Medicare expenditure category is reported at $0 in the Medicaid Statistical Information System 

(MSIS). During this period, states did not report expenditures for Medicare premiums in MSIS. 

However, expenditures associated with Medicare coinsurance and deductibles were reported under 

individual services throughout MSIS and therefore not identified as a Medicare expenditure.

Some—but not all—factors could be quantified to narrow the difference

between MSIS and CMS-64 expenditures. In particular, we adjusted for 

expenditures that could not be attributed to individual beneficiaries—one 

of the key differences in the design of the data sets. However, we could 

not quantify the effect of other factors, such as inconsistent CMS 

guidance across the two data sets.

MSIS is designed to report claims data, and CMS-64 is designed to 

reimburse states for their federal share of Medicaid expenditures. As we 

have noted, some expenditures that are required to be reported in 

CMS-64 do not appear in MSIS, such as when the expenditure is not tied 

to an individual enrollee’s claim. After adjusting the MSIS data to include 

expenditures for factors not related to individual enrollees’ claims, 

Medicaid expenditures for the nation based on MSIS data were 92, 93, 

and 94 percent of amounts shown in CMS-64 data, respectively, for fiscal 

years 2007, 2008, and 2009. (See table 2.)

Some Factors Could 

Be Quantified and 

Accounted for 

Approximately Half of 

the Expenditure 

Difference between 

the Data Sets

Differences Attributable to 

the Design of the Data Sets 

Could Be Quantified and 

Adjusted 
 

Page 14 GAO-13-47 Medicaid Data

Table 2: Total Medicaid Expenditures Adjusted in the Medicaid Statistical Information System (MSIS) and CMS-64, Fiscal 

Years 2007–2009

Fiscal year MSIS adjusted (dollars) CMS-64 baseline (dollars)

Difference between 

MSIS adjusted and 

CMS-64 baseline (dollars)

MSIS baseline 

as a percentage of 

CMS-64 (percent)

2007 $294,595,771,198 $320,052,492,375 $25,456,721,177 92%

2008 315,779,358,947 338,552,036,761 22,772,677,814 93

2009 345,172,184,969 366,486,147,093 21,313,962,124 94

Source: GAO analysis of Centers for Medicare & Medicaid Services’ data.

For fiscal year 2009, we were able to adjust MSIS data for four factors: 

DSH payments, Medicare premiums, national and state rebates for 

prescription drugs, and Medicaid health insurance payments. None of 

these factors were reported in MSIS because CMS officials indicated they 

were not attributed to an individual enrollee.

• DSH payments were included under the hospital expenditure category 

in CMS-64, but not in MSIS.22 We adjusted MSIS expenditure data to 

account for DSH payments to hospitals. For example, in fiscal year 

2009, states reported approximately $88 billion in total hospital 

expenditures on CMS-64, which included approximately $18 billion for 

DSH payments. Total hospital expenditures in MSIS were at about 

$53 billion. Adding the $18 billion in DSH payments to total hospital 

expenditures in MSIS increased the percentage of MSIS expenditures 

from 60 percent of CMS-64 expenditures to 81 percent. Even after 

this adjustment, MSIS hospital expenditures are $17 billion lower than 

those on CMS-64, indicating that there are additional factors that 

account for the difference in hospital-related expenditures between 

the two data sets.23

 

22In fiscal years 2007 through 2009, the CMS-64 included expenditures for DSH payments 

on line 1B for Inpatient Hospitals and 2B for Mental Health Facilities on the CMS-64, but 

these were not reported in MSIS.

23Totals do not add up due to rounding.
 

Page 15 GAO-13-47 Medicaid Data

• Medicare premiums were included in CMS-64, but CMS did not 

require states to report them in MSIS.24 In addition, Medicaid 

payments for enrollees with Medicare coinsurance and deductibles 

are included in MSIS, but within the various service types, and cannot 

be distinguished from other expenditures.25 In fiscal year 2009, total 

expenditures for Medicare as reported on CMS-64 were 

approximately $11 billion, whereas MSIS expenditures for the 

Medicare category were $0. Adjusting for the approximately 

$11 billion reported in fiscal year 2009 for Medicare premiums in 

CMS-64 increased the percentage of total Medicare expenditures in 

MSIS from 0 percent of CMS-64 expenditures to 92 percent, or a 

difference of $908 million. Thus, the primary factor that accounted for 

the difference in Medicare expenditures between the two data sets 

can be attributed to the absence of Medicare premium expenditures in 

MSIS.

• Prescription drug rebates were included in CMS-64, but CMS did not 

require states to report them in MSIS.26

 

24In fiscal years 2007 through 2009, the CMS-64 included expenditures for Medicare on 

lines 17A–D of the CMS-64, including rows for Medicare premiums, but the expenditures 

were not reported in MSIS. See line 17A for Medicare Health Insurance Payments Part A 

premiums, line 17B for Medicare Health Insurance Payments Part B premiums, line 17C1 

for 120–134 percent of the poverty level, line 17C2 for 135–175 percent of the poverty 

level.

Prescription drug rebates are 

made by drug manufacturers to states in a lump sum payment for 

Medicaid enrollees who use specific drugs, and therefore are not 

connected to individual claims. In fiscal year 2009, total expenditures 

for the prescription drugs category, as reported on CMS-64, were 

initially about $25 billion. However, there was a reduction to $16 billion 

when $10 billion dollars in national and state prescription drug rebates 

25In fiscal years 2007 through 2009, while MSIS did not include Medicare premiums, both 

CMS-64 and MSIS did include Medicaid expenditures for Medicare coinsurance and 

deductibles. However, MSIS includes these expenditures within the various expenditure 

types. Therefore, these expenditures cannot be tracked as a Medicare coinsurance or 

deductible using the MSIS annual person summary file. As a result, since expenditures 

from Medicare coinsurance and deductibles exist in MSIS, but are not captured in the 

Medicare category, we did not adjust for this, as doing so would double count these 

expenditures. In fiscal year 2009, the amount for Medicare coinsurance and deductibles in 

CMS-64 was approximately $908 million.

26In fiscal years 2007 through 2009, the CMS-64 included expenditures for prescription 

drug rebate offsets on rows 7A1 for national agreements and 7A2 for state side bar 

agreements of the CMS-64, but these were not reported in MSIS.
 

Page 16 GAO-13-47 Medicaid Data

were included.27 Total prescription drug expenditures in MSIS were 

approximately $25 billion. Adjusting for the $10 billion reported for 

prescription drug rebates in CMS-64 decreased the percentage of 

MSIS expenditures from 161 percent of CMS-64 expenditures to 

99 percent of CMS-64 expenditures. Thus, the difference in reported 

prescription drug expenditures can be almost entirely attributed to the 

rebates.28

• Some Medicaid health insurance payments were included in CMS-64 

that CMS did not require states to report in MSIS.29 In fiscal year 

2009, total expenditures for the managed care and Medicaid premium 

assistance expenditure category, as reported on CMS-64, were 

approximately $82 billion, of which $3 billion were for Medicaid health 

insurance payments not reported in MSIS. Total managed care and 

Medicaid premium assistance expenditures, as reported in MSIS, 

were approximately $85 billion. Adjusting for the roughly $3 billion for 

Medicaid health insurance payments increased the percentage of 

MSIS expenditures from 100 percent of CMS-64 expenditures to more 

than 103 percent. Therefore, total managed care and Medicaid 

premium assistance expenditures in MSIS were greater than those 

reported in CMS-64. (Fig. 4 compares the MSIS baseline to the MSIS 

adjusted expenditures as a percentage of CMS-64, by expenditure 

category, for fiscal year 2009.)

 

27Totals do not add up due to rounding. 

28CMS officials told us that some states did include rebates in their MSIS totals. We were 

unable to adjust for these since MSIS is not set up to separate rebates from other reported 

data.

29In fiscal years 2007 through 2009, the CMS-64 included expenditures for Medicaid 

health insurance payments on rows 18C (Medicaid health insurance payments–Group 

Health Plan Payments), 18D (Medicaid health insurance payments–Coinsurance and 

Deductibles) and 18E (Medicaid health insurance payments–Other), but these were not 

reported in MSIS.
 

Page 17 GAO-13-47 Medicaid Data

Figure 4: Comparison of MSIS Baseline to Adjusted Expenditures, by Expenditure Category, as a Percentage of CMS-64, 

Fiscal Year 2009

a

Adjustments were made by including reported CMS-64 dollars in the Medicaid Statistical Information 

System (MSIS).

Overall, for fiscal year 2009, the difference in Medicaid expenditures, after 

adjustments, decreased from $43 billion to $21 billion nationally. As a 

result, MSIS expenditures as a percentage of CMS-64 for the nation 

increased 6 percentage points from 88 percent to 94 percent—thereby 

reducing the difference in reported expenditures by half. (See fig. 5.)
 

Page 18 GAO-13-47 Medicaid Data

Figure 5: Comparison of MSIS Baseline to MSIS Adjusted Expenditures, as a Percentage of CMS-64, Fiscal Year 2009

a

Adjustments were made by including reported CMS-64 dollars in the Medicaid Statistical Information 

Systems (MSIS).

After adjustments, MSIS Medicaid expenditures for individual states 

increased slightly, but generally remained less than CMS-64 amounts. 

For individual states, Medicaid expenditures in MSIS ranged from 

55 percent to 131 percent of CMS-64 in fiscal years 2007 through 2009 

after adjustments were made. For fiscal year 2009, 29 states reported 

lower expenditures in MSIS than in CMS-64, 9 states reported higher 

expenditures in MSIS than in CMS-64, and 13 states reported similar 

Medicaid expenditures in MSIS when compared with CMS-64. (See 

fig. 6.) See appendix III for a table of adjusted state expenditures reported 

in MSIS and CMS-64, by dollar amount, for fiscal year 2009. See 

appendix IV for a map showing the percentages of adjusted Medicaid 

expenditures in MSIS compared with CMS-64, by state, for fiscal year 

2009.
 

Page 19 GAO-13-47 Medicaid Data

Figure 6: Comparison of MSIS Baseline to Adjusted Medicaid Expenditures, as a Percentage of CMS-64, by State, Fiscal Year 

2009
 

Page 20 GAO-13-47 Medicaid Data

Note: Adjustments were made by including reported CMS-64 dollars in the Medicaid Statistical 

Information System (MSIS).
 

Page 21 GAO-13-47 Medicaid Data

Differences between MSIS and CMS-64 Medicaid expenditures in six 

expenditure categories were also reduced after we adjusted the data in 

fiscal years 2007 through 2009. Two of the six expenditure categories—

hospital and Medicare—continued to show the largest percentage 

difference in Medicaid expenditures between MSIS and CMS-64 data. 

After adjustments were made, MSIS Medicaid expenditures in the 

hospital category were 80, 83, and 81 percent of the amounts shown in 

CMS-64, respectively for fiscal years 2007, 2008, and 2009, compared 

with 61, 62, and 60 percent before the adjustments were made. 

Expenditures for Medicare increased from 0 percent to more than 

90 percent for all 3 fiscal years when adjustments were made for 

Medicare premiums. (See fig. 7.)
 

Page 22 GAO-13-47 Medicaid Data

Figure 7: Adjusted Medicaid Expenditures in MSIS as a Percentage of CMS-64, by Expenditure Category, Fiscal Years 2007–

2009

Note: Adjustments were made by including reported CMS-64 dollars in the Medicaid Statistical 

Information System (MSIS). No adjustments were made for acute and long-term support services 

(LTSS)-noninstitutional and LTSS-institutional.

Inconsistent CMS guidance and states’ practices resulted in differences 

between MSIS and CMS-64 data. However, we could not adjust for these 

factors because we could not quantify the extent to which these factors 

resulted in differences.

Three of the factors that account for the differences in expenditures result 

from inconsistent CMS guidance regarding expenditure definitions, 

reporting dates, and reporting supplemental payments during fiscal years 

2007 through 2009.

Inconsistent Guidance and 

States’ Practices Result in 

Differences That Could 

Not Be Quantified
 

Page 23 GAO-13-47 Medicaid Data

• Inconsistent MSIS and CMS-64 Definitions: CMS guidance to states 

for reporting expenditures in MSIS and CMS-64 contained 

inconsistent definitions of services, making it impossible to do a onefor-one match of similar expenditures.30 CMS officials indicated that 

the definitions used in guidance to states on completing the CMS-64 

are based on definitions included in federal regulations,31 while MSIS 

definitions are based on separate CMS guidance that was not derived 

from the regulations. These definitions are sometimes inconsistent. 

CMS officials explained that, for example, expenditures for inpatient 

services, as reported by a state in CMS-64, cannot be assumed to be 

the same services reported by the state in MSIS, despite the service 

having the same name in both data sets. Therefore, expenditures can 

be measured and reported by a state inconsistently across the data 

sets, making comparisons problematic. Specifically, even after 

adjustments were made, 13 states reported hospital-related 

expenditures in MSIS that were 75 percent or less of what they 

reported in their CMS-64 data.

Additionally, inconsistent definitions across the two data sets make it 

difficult to examine Medicaid spending. For example, states may vary 

in their interpretation of the definitions in MSIS and CMS-64 guidance, 

and this inconsistency creates a challenge for examining total 

expenditures by service nationally and across states. (See app. V for 

reported expenditures by service, for all 50 states and the District of 

Columbia in fiscal year 2009.)

• Reporting Dates Differed: CMS officials recognized that CMS 

guidance to states for reporting the date of expenditures and adjusting 

payments made in prior years is different between MSIS and CMS-64. 

MSIS expenditures were based on each claim’s date of adjudication—

the date the payment was approved—while CMS-64 expenditures 

were reported as of the date of payment. The two data sets also differ 

in how they adjust payments made in prior years, according to CMS 

officials. Adjustments in MSIS allow the state to show changes to net 

 

30MSIS Guidance: The CMS MSIS File Specifications and Data Dictionary provides 

information, including definitions, for MSIS reporting. CMS-64 Guidance: The Category 

of Service Line Definitions for the 64.9 provides information, including definitions, for 

CMS-64 reporting of net expenditures.

31In general, service type definitions used for reporting expenditures on the CMS-64 are 

derived from federal regulation. See 42 C.F.R. part 440. (2011).
 

Page 24 GAO-13-47 Medicaid Data

totals for the year, no matter when the adjustment was reported into 

the data. In contrast, adjustments to CMS-64 were entered for the 

fiscal year in which they were identified and the original year was not 

modified. MSIS and CMS-64 expenditures, therefore, may vary by 

quarter and by fiscal year if the dates associated with an expenditure 

differ. Since MSIS and CMS-64 report expenditures using different 

dates, we cannot adjust for this difference in the data. CMS officials 

indicated their concerns with this inconsistency and noted that it 

makes comparing expenditure data between the two data sets 

difficult.

• Supplemental Payments: For CMS-64 data, CMS officials required 

states to report supplemental payments within the corresponding 

expenditure categories, because states were not required to report 

these expenditures separately.32 However, CMS officials indicated 

states reported supplemental payments in MSIS as a lump sum, and 

therefore they were excluded from the MSIS annual person summary 

file used in our analysis.33 Therefore, supplemental payments, 

excluding DSH payments, were reported inconsistently between the 

two data sets during fiscal years 2007 through 2009.34 As such, MSIS 

expenditure data are likely to show a lower amount than CMS-64 for 

several Medicaid expenditure categories. GAO and others have 

reported concerns about supplemental payments over the last 

decade, including the use of supplemental payment arrangements to 

increase federal funding without a commensurate increase in state 

funding.35 Absent improved reporting, CMS cannot adequately 

oversee states’ use of supplemental payments.

Three additional factors that accounted for the differences in expenditures 

result from inconsistent practices among states. Specifically, states are 

inconsistent in MSIS compared with CMS-64 regarding the timeliness of 

 

32CMS added several new lines to the form CMS-64 in fiscal year 2010, including lines for 

states to report supplemental payments within each category of care for several 

expenditure types.

33CMS officials indicated that, on a rare occasion, states may report supplemental 

payments at the individual claims level. Overall, states report few supplemental payments 

in MSIS.

34See GAO-12-694. 

35See GAO-11-278. 
 

Page 25 GAO-13-47 Medicaid Data

MSIS data, the quality of MSIS data reported, and payments for local 

government providers during fiscal years 2007 through 2009.

• Timeliness of MSIS data: States often delay reporting MSIS data, but 

report CMS-64 expenditure data on time. CMS guidance requires 

states to report data in CMS-64 within 30 days of the end of the 

quarter and within 45 days for MSIS. However, states have often been 

late reporting MSIS data, with some states delaying reporting of MSIS 

data for as long as 3 years. For example, as of July 2012, 37 states 

had submitted their fiscal year 2010 MSIS data, even though CMS 

requirements would indicate that MSIS data for 2010, 2011, and the 

first two quarters of 2012 should have already been provided. 

Alternatively, states submit their expenditures by means of CMS-64 

on time and have a strong incentive to do so promptly because CMS 

uses this information to reimburse states for the federal share of 

Medicaid expenses. In contrast, states have less incentive to submit 

MSIS data promptly because the data are not tied to their federal

reimbursement, and MSIS data are not used in the daily operations of 

their Medicaid programs. CMS officials told us that states that delay 

reporting can have issues with both the timeliness and quality of their 

submissions. If states submit poor quality data, CMS may reject the 

submission, resulting in further delays.36

• MSIS Data Quality: MSIS expenditure data are considered less 

reliable when compared with CMS-64. CMS-64 is reviewed regularly 

by CMS officials and considered the most-reliable and mostcomprehensive data on Medicaid expenditures. Alternatively, while 

CMS conducts routine quality checks on MSIS data, problems still 

remain. CMS publishes a report of anomalous MSIS claims—those 

that are not consistent with what is expected to be reported by the

state.37

 

36CMS officials indicated that some states have also not reported their data in prior years. 

Additionally, the MSIS delay did not affect our ability to analyze the data because we used 

the most-recent and most-complete data available, fiscal years 2007 through 2009.

On the basis of our interviews with state Medicaid officials, the 

quality of MSIS data, as indicated by an anomalous claim, may be an 

additional factor that accounts for the difference between MSIS and 

CMS-64 reported expenditures. For example, Medicaid officials in one 

state we interviewed told us that the state incorrectly reported Home & 

37The MSIS State Data Characteristics/Anomalies Report identifies MSIS data that are not 

reconciled after quality checks are completed between CMS and the state.
 

Page 26 GAO-13-47 Medicaid Data

Community-Based 1915(c) waivers payments in MSIS in fiscal year 

2009, and therefore CMS noted this in the anomalies report.38 As a 

result of this error, the state underreported its MSIS expenditures for 

Home & Community-Based services compared with those reported on 

CMS-64. Having more timely data could be a mechanism for helping 

identify anomalies between the two systems and correcting 

discrepancies earlier.

• Local Government Provider Payments: CMS officials indicated that 

states may report in MSIS the amount paid to the local government for 

the medical service reported on the claim. However, the local 

government provider may also receive payment from the local 

government through prior alternative arrangements, and thus would 

not link these expenditures to a specific service provided or even 

report them at all in MSIS. These expenditures arise when states and 

localities finance Medicaid services through certified public 

expenditures.

39 In contrast, these additional expenditures would be 

captured in the total expenditures reported by states in CMS-64. 

Consequently, states may report a smaller amount in MSIS 

associated with the claim than reported by the state in total Medicaid 

expenditures on CMS-64. CMS officials indicated that neither CMS-64 

nor MSIS provides a link to expenditures from government providers; 

as a result, we were unable to adjust for this difference.

CMS has indicated plans to improve MSIS through a pilot program called 

Transformed-MSIS. There are a number of goals for this pilot, including 

plans to establish MSIS as a robust, flexible, and repeatable datacollection process, to collect valid, timely information for decision making, 

and to integrate data between management information systems. These 

goals include a link between states’ reporting of MSIS with reporting of 

CMS-64 data. However, CMS officials have indicated that there is no 

 

38The 1915(c) waivers are one of many options available to states to allow the provision of 

long-term care services in home and community-based settings under the Medicaid 

program. States’ programs can offer a combination of standard medical services, and 

nonmedical services, including homemaker, home health aide, personal care, adult day 

health services, habilitation, and respite care. See Social Security Act §1915(c), codified 

at 42 U.S.C. § 1396n(c).

39Under a Certified Public Expenditure arrangement, a government provider, such as a 

county hospital, certifies to a state the amount of expenditures for a Medicaid-covered 

service provided to a Medicaid beneficiary. The state obtains federal Medicaid matching 

funds based on the amount of the expenditure. 
 

Page 27 GAO-13-47 Medicaid Data

timeline for implementing this goal, whereas other aspects of the initiative 

are expected to be implemented in all states by fiscal year 2014. 

Moreover, such integration will only be of value if improvements are made 

in the timeliness and quality of MSIS data. One state in the pilot indicated 

that data-quality issues remain prevalent. Additionally, this state noted 

that the size and complexity of MSIS creates challenges with 

submissions’ timeliness and availability. As of June 2012, CMS officials 

indicated that the initial results for the pilot program are being considered 

by management, yet until these plans have been fully implemented it is 

unclear what the outcome of these efforts will be.

In fiscal year 2009, the difference between MSIS and CMS-64 was 

$43 billion. Much of the difference was primarily the result of the different 

designs of each data set. CMS uses MSIS data for beneficiary-specific 

expenditures, while CMS-64 data are used to compute the federal 

financial participation for each state’s Medicaid program costs. However, 

even after adjusting for DSH payments, Medicare premiums, prescription 

drug rebates, and Medicaid health insurance payments, differences 

remain. In fiscal year 2009, total MSIS expenditure data, after 

adjustments, showed MSIS at 94 percent of CMS-64 expenditures, which 

left billions of dollars unexplained.

The remaining differences between the two data sets are potentially 

explained by inconsistencies in CMS guidance and states’ reporting 

practices, neither of which can be quantified. In fiscal years 2007 through 

2009, CMS provided states with inconsistent MSIS and CMS-64 guidance 

regarding expenditure definitions, reporting dates, and reporting of 

supplemental payments. Additionally, when compared with CMS-64, state 

MSIS data were often delayed beyond the time frames established by 

CMS, inconsistent in reporting payments for local government providers, 

and were of poor quality.

Taken together, these two data sets have the potential to offer a robust 

view of the Medicaid program, enhancing CMS oversight of aggregate 

spending trends, per beneficiary spending growth, and cross-state 

comparisons, all of which could be useful in improving the financial 

integrity of this high-risk program. This is critical given that Medicaid, a 

program that GAO identified on our high-risk list, has among the highest 

estimated improper payments of any federal program reporting such data. 

However, the usefulness of these data sets as oversight tools is limited 

because of delays in reporting and unnecessary inconsistencies between 

the two data sets, both of which are inconsistent with federal internal 

Concluding 

Observations 
 

Page 28 GAO-13-47 Medicaid Data

control standards. The 3-year lag in states’ reporting of MSIS data 

prevents its use for timely oversight of beneficiary-related utilization and 

other spending trends. For example, identifying a difference in hospital 

expenditures between MSIS and CMS-64 is of limited use when detected 

3 years later. If states were meeting the current requirement of providing 

MSIS data 45 days after each quarter, then such comparisons could 

provide more useful and timely information.

CMS has recently completed a pilot study aimed in part on improving 

MSIS data. CMS has indicated that it will begin implementing aspects of 

this initiative in all states by fiscal year 2014. One goal of this initiative is 

to integrate state reporting of MSIS with the reporting of CMS-64 data. 

However, CMS officials have indicated they have yet to determine a 

timeline for this goal. While the initial results of this pilot have not been 

finalized, improving the timeliness and consistency of MSIS and CMS-64 

data through this effort could aid CMS’s understanding and oversight of 

this high-risk program. 

HHS reviewed a draft of this report and provided technical comments, 

which we incorporated as appropriate.

As agreed with your office, unless you publicly announce the contents of 

this report earlier, we plan no further distribution until 30 days from the 

report date. At that time, we will send copies of this report to the 

Secretary of Health and Human Services, the Administrator of CMS, and 

other interested parties. In addition, the report will be available at no 

charge on the GAO website at http://www.gao.gov. 

Agency Comments
 

Page 29 GAO-13-47 Medicaid Data

If you or your staff have any questions about this report, please contact 

me at (202) 512-7114 or yocomc@gao.gov. Contact points for our Offices 

of Congressional Relations and Public Affairs may be found on the last 

page of this report. GAO staff who made key contributions to this report 

are listed in appendix VI.

Sincerely yours,

Carolyn L. Yocom

Director, Health Care
Appendix I: Scope and Methodology

Page 30 GAO-13-47 Medicaid Data

We conducted two types of analysis of Medicaid expenditures for this 

report to compare the Medicaid Statistical Information System (MSIS) and 

CMS-64 data. First, we conducted a baseline analysis to compare total 

expenditures reported to MSIS and CMS-64 nationally and by state. We 

also compared reported expenditures by expenditure category. Secondly, 

we conducted an adjustment analysis. Specifically, we attempted to 

reconcile the expenditures by making adjustments to MSIS on the basis 

of the differences we identified in the MSIS and CMS-64 data sets. To the 

extent possible, we added expenditures reported in CMS-64, but not 

reported in MSIS, to total expenditures in MSIS.

I. Baseline Analysis

To determine the extent to which MSIS and CMS-64 data sets on 

Medicaid expenditures differ, nationally and by state,1 for fiscal years 

2007 through 2009, we conducted a multistep analysis.2

Step 1: Obtain MSIS and CMS-64 Data

With total 

expenditures from both data sets, we calculated the expenditures 

reported in MSIS as a percentage of those reported in CMS-64. We also 

determined the percentage difference in total expenditures between the 

two data sets, by expenditure category.

In order to identify the baseline of total Medicaid expenditures for fiscal 

years 2007 through 2009, we obtained from the Center for Medicare & 

Medicaid Services (CMS) MSIS and CMS-64 data for each of the 50 

states and the District of Columbia.3

 

1

In this report, we use the term “state” to refer to the 50 states and the District of 

Columbia. We do not include Puerto Rico or the U.S. territories of American Samoa, 

Guam, the Northern Mariana Islands, or the U.S. Virgin Islands (which have Medicaid 

programs), Medicaid administrative expenses, or state collections in the CMS-64 because 

they were not reported in MSIS during fiscal years 2007 through 2009.

2

We used these fiscal years because they were the most-recent and most-complete data 

available at the time of our analysis.

3

We define the baseline to be our initial calculations of total Medicaid expenditures as 

reported by CMS-64 and MSIS for all 50 states and the District of Columbia. Therefore, 

the baseline does not include any adjustments to the data. There is a baseline 

expenditure amount for CMS-64 and another for MSIS. Additionally, U.S. territories were 

excluded from our analysis because they do not report any Medicaid claims in MSIS. 

Appendix I: Scope and Methodology
Appendix I: Scope and Methodology

Page 31 GAO-13-47 Medicaid Data

• MSIS data: We obtained the MSIS Annual Person Summary File data, 

which CMS officials confirmed were appropriate for our analysis. The 

summary file includes monthly enrollment data, but only includes 

annual expenditure data by type of service.4 It is most comparable to 

CMS-64 because both data sets provide total expenditures for the 

fiscal year. The summary file also includes some enrollment and 

expenditure information on the Children’s Health Insurance Program 

(CHIP).5

• CMS-64 data: We used the CMS-64 net expenditures financial 

management report within the Medicaid Budget and Expenditure 

System. The financial management report is an annual account of 

states’ program and administrative Medicaid expenditures, including 

federal and state expenditures by expenditure category. The financial 

management report also contains information solely related to 

Medicaid.

Step 2: Determine Medicaid Expenditures in MSIS for the Fiscal Year on 

the Basis of the Number of Medicaid Enrollees

Because MSIS includes both Medicaid and CHIP expenditures, we 

separated these expenditures to the extent possible. To do this, we first 

determined whether a beneficiary was eligible for Medicaid or CHIP by 

using the monthly eligibility code in MSIS.6

 

4

MSIS includes some lump sum expenditures that are not captured using the annual 

person summary file.

The Annual Person Summary 

File ties an entire month’s expenditures to an individual on the basis of his 

5

MSIS data are available in several file formats, including (1) full files with detailed claims 

and enrollment data by individual, such as encounters, name of provider, and type of care 

as reported directly by the states; (2) annual person summary files of expenditure data, 

which summarize all the data for a person for the fiscal year, but exclude some encounter 

details included in the full file (for example, the summary file may not include details 

regarding the care encounter, such as individual cost per encounter; however, it does 

include monthly enrollment data); (3) Medicaid Analytic eXtract (MAX) files, which are 

considered to have the highest-quality data, but also have the greatest delay in 

availability—up to 3 years; and (4) the State Summary DataMart, which is a public online 

data system that provides state aggregated Medicaid claims, but not by the individual 

person.

6

The monthly eligibility categories include both Medicaid and CHIP. The eligibility 

categories and their MSIS coding are: 0=ineligible, 1=Medicaid, 2=Medicaid Expansion 

CHIP (M-CHIP), 3=CHIP non-Medicaid (also known as S-CHIP), and 4=CHIP unknown 

(also interpreted to mean that the eligibility overall is unknown).
Appendix I: Scope and Methodology

Page 32 GAO-13-47 Medicaid Data

or her monthly eligibility code. The next step was to remove, to the extent 

possible, the CHIP expenditures in order to match MSIS expenditures 

with CMS-64. (CMS-64 does not include CHIP expenditures.)

CMS officials indicated that states were able to report CHIP expenditures 

within MSIS if they had a Medicaid expansion-CHIP program (i.e., a CHIP 

program that operates as part of the Medicaid program), also known as 

M-CHIP.7 Consequently, we were able to distinguish between Medicaid 

and M-CHIP spending.8

In contrast, CMS officials told us that until fiscal year 2010, states with a 

stand-alone CHIP program (i.e., one that is operated separately from a 

Medicaid program by the state; also known as S-CHIP) were not 

supposed to report these expenditures into MSIS despite the presence of 

the S-CHIP eligibility code. CMS officials indicated that any expenditures 

associated with S-CHIP should be assumed to be Medicaid expenditures 

despite the CHIP eligibility code. Therefore, we included any expenditures 

associated with the S-CHIP code as Medicaid expenditures.

We thus removed from all MSIS totals any 

M-CHIP expenditures to the extent possible. We determined the number 

of months in the fiscal year a beneficiary received benefits under 

Medicaid or M-CHIP. On the basis of this count, we prorated the 

enrollees’ total expenses for the fiscal year on the basis of the proportion 

of the year a person was enrolled in either M-CHIP or Medicaid. If a 

person was enrolled in the M-CHIP program for part of the year, then a 

portion of the annual spending was apportioned toward M-CHIP. For 

example, if a person was enrolled in M-CHIP for 3 months, then a quarter 

of the expenditures would be considered M-CHIP, and the remaining 

three-quarters of expenditures would be considered Medicaid. 

Consequently, the Medicaid expenditures include prorated amounts for 

Medicaid and M-CHIP enrollees.

9

 

7

Instead of a M-CHIP program, a state may elect to have a stand-alone CHIP program 

that is operated separately from the Medicaid program. Stand-alone programs are referred 

to as S-CHIP. 

8

Although M-CHIP programs operate as expansions of Medicaid programs, expenditures 

are considered CHIP expenditures rather than Medicaid expenditures.

9

Expenditures in MSIS for enrollees whose eligibility was listed as S-CHIP totaled 

$481 million in fiscal year 2009, or less than 1 percent of total Medicaid expenditures 

reported in MSIS. 
Appendix I: Scope and Methodology

Page 33 GAO-13-47 Medicaid Data

Lastly, we included as Medicaid expenditures any other expenditures 

associated with all other eligibility categories. These other eligibility 

variables included “unknown” and “ineligible,” as well as Medicaid.10

Step 3: Matching Inconsistent Definitions of Services between MSIS and 

CMS-64

Consequently, for states with standalone S-CHIP programs and those 

that did not separate out M-CHIP expenditures, the total Medicaid 

expenditures may be inflated in MSIS. Similarly, any expenditures 

reported under the unknown and ineligible categories that were not 

Medicaid expenditures may also inflate Medicaid expenditures.

MSIS and CMS-64 data consist of expenditures broken down by service 

types.11 To compare MSIS and CMS-64 expenditures, we reviewed the 

definitions of Medicaid service types used in each data set. This is 

necessary because, in many instances, a one-to-one match of service 

types in MSIS to those in CMS-64 is not possible. For example, in fiscal 

years 2007 through 2009, the MSIS Annual Person Summary File had 29 

service types, whereas CMS-64 had 43. (See table 3 for a list of MSIS 

and CMS-64 service types used in fiscal years 2007 through 2009.)

 

10Expenditures in MSIS for enrollees whose eligibility was listed as unknown or ineligible 

totaled approximately $28 billion and $6 billion, respectively, in fiscal year 2009; or 

approximately 9 percent and 2 percent of total Medicaid expenditures reported in MSIS.

11While we are matching services between these two data sets, some of the expenditures 

we describe here are not directly tied to a Medicaid service in MSIS, such as Medicaid 

payments for Medicare premiums.
Appendix I: Scope and Methodology

Page 34 GAO-13-47 Medicaid Data

Table 3: Medicaid Statistical Information System (MSIS) and CMS-64 Service Types, Fiscal Years 2007–2009

MSIS service types CMS-64 line numbers and service types 

Inpatient hospital

Inpatient mental health–aged 

Inpatient mental health–under 21

Intermediate care facility–mentally retarded

Nursing facility

Physician

Dental

Other practitioner 

Outpatient hospital

Clinic

Home health

Lab and x-ray 

Drugs

Other services

HMO-capitation

Prepaid Health Plan (PHP)–capitation

Primary Care Case Management (PCCM)–capitation

Sterilization

Abortion 

Transportation

Personal care 

Targeted case management

Rehabilitative services

Physical, occupational, speech, and hearing therapy 

Hospice

Nurse Midwife

Nurse Practitioner

Private duty nurse

Unknown

1A. Inpatient hospital

1B. Inpatient hospital–DSH

2A. Mental health facility

2B. Mental health facility–DSH

3. Nursing facility services

4A. Intermediate care facility–mentally retarded (public providers)

4B. Intermediate care facility–mentally retarded (private providers)

5. Physicians services

6. Outpatient hospital services

7. Prescribed drugs (gross spending)

7A1. Drug rebates offset (national agreement)

7A2. Drug rebates offset (state sidebar agreement)

8. Dental

9. Other practitioner services 

10. Clinic services 

11. Laboratory and radiological services

12. Home health services

13. Sterilizations

14. Abortions

15. Early Periodic Screening, Diagnosis, and Treatment (EPSDT) services

16. Rural health clinic screenings

17A. Medicare health insurance payments–Part A premiums

17B. Medicare health insurance payments–Part B premiums

17C1. 120 percent–134 percent of the poverty levela

17C2. 135 percent–175 percent of the poverty levelb

17D. Medicare–coinsurance and deductibles

18A. Medicaid health insurance payments–managed care organizations

18B1. Medicaid health insurance payments–prepaid ambulatory health plan

18B2. Medicaid health insurance payments–prepaid inpatient health plan

18C. Medicaid health insurance payments–group health plan payments

18D. Medicaid health insurance payments–coinsurance and deductibles

18E. Medicaid health insurance payments–other

19. Home and community based services

20. Home and community based care for functionally disabled elderly

21. Community supported living services
Appendix I: Scope and Methodology

Page 35 GAO-13-47 Medicaid Data

MSIS service types CMS-64 line numbers and service types 

22. Programs of All-Inclusive Care for the Elderly (PACE)

23. Personal care services

24. Targeted case management services

25. Primary Care Case Management (PCCM) Services

26. Hospice benefits

27. Emergency services for undocumented aliens

28. Federally-qualified health center

29. Other care services 

Source: GAO analysis of Centers for Medicare & Medicaid Services data.

a

Medicaid expenditures reported on line 17C1 include premiums paid for Medicare Part B for 

individuals whose income is 120-134 percent of the poverty level. 

b

Medicaid expenditures reported on line 17C2 include the percentage of the Medicare Part B 

premium attributable to the Home Health Benefit transferred from Part A to Part B for individuals 

whose income is 135-175 percent of the poverty level.

Because of the lack of a one-to-one match between MSIS and CMS-64 

service types, we combined MSIS and CMS-64 service types into six 

combined expenditure categories. (See table 4 for the list of the combined 

expenditure categories, and MSIS and CMS-64 service types included in 

each.) As a result, we were able to report on total expenditures by 

combined expenditure categories.
Appendix I: Scope and Methodology

Page 36 GAO-13-47 Medicaid Data

Table 4: Combined Expenditure Categories and Corresponding MSIS and CMS-64 Service Types

Combined 

expenditure 

categories MSIS service types CMS-64 line numbers and service types

Hospital Inpatient hospital

Outpatient hospital

Inpatient mental health facility for under age 21

Mental health facility for the aged

1A. Inpatient hospital

1B. Inpatient hospital–Disproportionate Share Hospitals 

 (DSH)

2A. Mental health facility

2B. Mental health facility–DSH

6. Outpatient hospital services

27. Emergency services for undocumented aliens

Acute and long 

term support 

services (LTSS)- 

noninstitutional

Physician

Dental

Nurse midwife

Nurse practitioner

Other practitioner

Home health

Clinic

Lab and x-ray 

Sterilizations

Abortions

Personal care

Private duty nursing

Targeted case management

Rehabilitative services

Hospice

Other services

Physical, occupational, speech, and hearing 

 therapy

Transportation services

5. Physicians services

8. Dental

9. Other practitioner services

10. Clinic services

11. Laboratory and radiological services

12. Home health services

13. Sterilizations

14. Abortions

15. Early Periodic Screening, Diagnosis, and Treatment

 (EPSDT) Services

16. Rural health clinic screenings

19. Home and community based services

20. Home and community based care for functionally 

 disabled elderly

21. Community supported living services

23. Personal care services

24. Targeted case management services

26. Hospice benefits

28. Federally Qualified Health Center (FQHC)

29. Other care services 

Drugs Drugs (gross spending) 7. Prescribed drugs (gross spending)

7A1. Drug rebates offset (national agreement)

7A2. Drug rebates offset (state sidebar agreement)
Appendix I: Scope and Methodology

Page 37 GAO-13-47 Medicaid Data

Combined 

expenditure 

categories MSIS service types CMS-64 line numbers and service types

Managed care and 

Medicaid premium 

assistance

HMO capitation

Prepaid Health Plan (PHP)

Primary care case management

18A. Medicaid health insurance payments–managed care 

 organizations

18B1. Medicaid health insurance payments–Prepaid 

 Ambulatory Health Plan

18B2. Medicaid health insurance payments–Prepaid Inpatient

 Health Plan

18C. Medicaid health insurance payments–Group Health 

 Plan Payments

18D. Medicaid health insurance payments–Coinsurance and

 Deductibles

18E. Medicaid health insurance payments–other

25. Primary Care Case Management (PCCM) Services

22. Program of All-Inclusive Care for the Elderly (PACE)

Long term support 

servicesinstitutional

Nursing facility

Intermediate care facility–mentally retarded

3. Nursing facility services

4A. Intermediate care facility-mentally retarded (public 

 providers)

4B. Intermediate care facility-mentally retarded (private 

 providers)

Medicare 17A. Medicare health insurance payments–Part A 

 premiums

17B. Medicare health insurance payments–Part B 

 premiums

17C1. 120–134 percent of the poverty level

17C2. 135–175 percent of the poverty level

17D. Medicare coinsurance and deductibles

Source: GAO analysis of Centers for Medicare & Medicaid Services’ (CMS) data.

Notes: The combined expenditure categories listed are based on analysis of the Medicaid Statistical 

Information System (MSIS) and CMS service types. We combined acute care and long term support 

services because CMS officials told us there was overlap between services in each type of care. 

The MSIS “unknown” service type was proportionally distributed across 5 categories, excluding 

Medicare.

While states could report expenditures under “Religious non-medical” in CMS-64 for fiscal years 2007 

through 2009, no state did so. There is no corresponding category in MSIS.

Step 4: Excluded Expenditures

For certain CMS-64 expenditures, instead of adding them to MSIS, we 

excluded them from CMS-64. Specifically, expenditures from Puerto Rico 

or the U.S. territories from CMS-64 were excluded because these are not 

in MSIS data. 
Appendix I: Scope and Methodology

Page 38 GAO-13-47 Medicaid Data

Additionally, we excluded all administrative expenses from CMS-64 

reported amounts, because these are not reported in MSIS data. We also 

excluded all state collections from CMS-64, because these are not in 

MSIS.12

Step 5: Comparison of MSIS and CMS-64 Expenditures

 

We compared total Medicaid expenditures in MSIS and CMS-64 for fiscal 

years 2007 through 2009, nationally and for all 50 states and the District 

of Columbia, to determine the extent of the difference between these two 

data sets. With total expenditures from both data sets, we calculated the 

expenditures in MSIS as a percentage of those reported in CMS-64. We 

also compared total Medicaid expenditures by our six combined 

expenditure categories, as reported by MSIS and CMS-64 for fiscal years 

2007 through 2009.

II. Adjustment Analysis

To conduct our adjustment analysis, we determined the factors that 

account for the difference between MSIS and CMS-64 data on Medicaid 

expenditures. We identified and analyzed factors that account for the 

differences in each data set in fiscal years 2007 through 2009. We 

attempted to reconcile the expenditures by making adjustments to the

MSIS expenditures on the basis of the differences we identified. In 

attempting to reconcile these differences, we made adjustments to the 

baseline analysis described above. Specifically, we added expenditures 

reported in CMS-64 that were not reported in MSIS to the MSIS amounts. 

We added expenditures to MSIS rather than subtracting them from CMS64, because CMS-64 contains total Medicaid spending, and the additions 

make MSIS a better approximation of this spending. For certain service 

types, MSIS and CMS-64 reported different amounts of Medicaid 

expenditures because of differences in the way they capture the 

expenditure information. We identified four factors that account for the 

differences that we were able to quantify. Therefore, we adjusted the 

MSIS baseline amount and reduced the gap between the two data sets. 

Specifically, MSIS does not include Disproportionate Share Hospital 

(DSH) payments, Medicare premiums, prescription drug rebates, and 

 

12State collections include offsetting collections from third-party liability, estate, and other 

recoveries.
Appendix I: Scope and Methodology

Page 39 GAO-13-47 Medicaid Data

Medicaid health insurance payments. We then compared total adjusted 

expenditures nationally and by state. We did this by comparing the 

expenditures reported in MSIS as a percentage of those reported in 

CMS-64. We also compared adjusted expenditures by combined 

expenditure category, nationally and by state.

Step 1: 

We added expenditures from DSH payments as reported on line 1B 

(Inpatient Hospital Service–DSH Adjustment Payments) in CMS-64 to the 

MSIS baseline amount within the Combined Hospital expenditure 

category.

Step 2: 

We added expenditures related to Medicare premiums from lines 17A 

(Medicare Health Insurance Payments–Part A premiums), 17B (Medicare 

Health Insurance Payments–Part B premiums), 17C1 (120–134 percent 

of the poverty level), and 17C2 (135–175 percent of the poverty level) 

from CMS-64 to the MSIS baseline amount within the combined Medicare 

expenditure category.13

Step 3: 

We subtracted prescription drug rebate amounts reported on line 7A1 

(Drug Rebate Offset–National Agreement) and 7A2 (Drug Rebate Offset–

State Sidebar Agreement) in CMS-64 within the prescription drugs 

expenditure category from the MSIS baseline amount within the 

Combined Prescription Drug expenditure category.14

 

13Medicaid expenditures reported on line 17C1 include premiums paid for Medicare Part B 

for individuals whose income is 120–134 percent of the poverty level. Medicaid 

expenditures reported on line 17C2 include the percentage of the Medicare Part B 

premium attributable to the Home Health Benefit transferred from Part A to Part B for 

individuals whose income is 135–175 percent of the poverty level. 

14Unlike the other adjustments, the adjustment for prescription drug rebates decreases the 

spending reported in MSIS. Prescription drug spending is overreported in MSIS because 

rebates are not included in the data set. Consequently, for this category we subtracted the 

amounted reported in CMS-64 for prescription drug rebates from the amount in MSIS. 
Appendix I: Scope and Methodology

Page 40 GAO-13-47 Medicaid Data

Step 4: 

We added expenditures related to Medicaid health insurance payments 

from lines 18C (Medicaid health insurance payments–Group Health Plan 

Payments), 18D (Medicaid health insurance payments–Coinsurance and 

Deductibles) and 18E (Medicaid health insurance payments–Other) in 

CMS 64 to the MSIS baseline amount within the combined managed care 

and Medicaid premium assistance category.

Step 5:

After making the adjustments in steps 1 through 4, we compared the total 

adjusted Medicaid expenditures as reported in MSIS and CMS-64 for 

fiscal years 2007 through 2009, nationally and for all 50 states and the 

District of Columbia. With total expenditures from both data sets, we 

calculated the expenditures reported in MSIS as a percentage of those 

reported in CMS-64.

We also compared total adjusted Medicaid expenditures by our six 

expenditure categories, as reported by MSIS and CMS-64 for fiscal years 

2007 through 2009.

After making the expenditure adjustments, we determined any remaining 

expenditure differences between MSIS and CMS-64. We then identified 

additional factors that help account for the difference between data sets. 

However, because these were not systematic quantitative differences, 

they could not be used to adjust the expenditures.

We conducted this performance audit from March 2012 through 

September 2012 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.
Appendix II: Total Baseline Medicaid 

Expenditures in MSIS and CMS-64, by State, 

Fiscal Year 2009

Page 41 GAO-13-47 Medicaid Data

State MSIS baseline (dollars) CMS-64 baseline (dollars)

MSIS baseline as a

percent of CMS-64

Alabama $3,625,540,937 $4,415,801,712 82%

Alaska 1,040,288,855 1,069,624,574 97

Arizona 8,628,093,458 8,665,269,493 100

Arkansas 3,486,489,877 3,451,516,646 101

California 35,002,258,860 41,389,559,881 85

Colorado 3,288,276,426 3,555,155,172 92

Connecticut 5,289,134,290 6,035,281,239 88

Delaware 1,263,983,534 1,211,814,329 104

District of Columbia 1,928,483,265 1,626,139,477 119

Florida 14,051,386,231 15,088,582,200 93

Georgia 7,376,411,423 7,693,345,212 96

Hawaii 1,172,582,338 1,308,211,194 90

Idaho 1,330,846,516 1,276,526,247 104

Illinois 11,658,850,516 13,140,383,274 89

Indiana 5,312,111,931 5,906,490,283 90

Iowa 2,870,172,181 2,960,114,156 97

Kansas 2,315,819,323 2,443,675,864 95

Kentucky 4,927,054,393 5,400,899,512 91

Louisiana 5,230,654,120 6,513,211,836 80

Maine 1,480,509,448 2,517,981,111 59

Maryland 6,124,798,441 6,523,939,093 94

Massachusetts 9,928,887,946 12,480,644,429 80

Michigan 10,145,744,904 10,583,215,243 96

Minnesota 7,029,437,421 7,387,421,506 95

Mississippi 3,199,788,959 3,947,805,053 81

Missouri 5,679,022,531 7,747,665,625 73

Montana 714,263,803 875,768,845 82

Nebraska 1,542,139,671 1,616,257,729 95

Nevada 1,196,285,725 1,383,003,611 86

New Hampshire 994,261,996 1,327,164,314 75

New Jersey 7,924,068,702 9,667,209,281 82

New Mexico 2,633,955,686 3,290,379,397 80

New York 44,882,629,782 49,368,510,253 91

North Carolina 9,589,597,797 11,506,119,180 83

North Dakota 581,137,250 572,101,389 102

Appendix II: Total Baseline Medicaid 

Expenditures in MSIS and CMS-64, by State, 

Fiscal Year 2009
Appendix II: Total Baseline Medicaid 

Expenditures in MSIS and CMS-64, by State, 

Fiscal Year 2009

Page 42 GAO-13-47 Medicaid Data

State MSIS baseline (dollars) CMS-64 baseline (dollars)

MSIS baseline as a

percent of CMS-64

Ohio 13,655,184,427 14,150,220,981 97

Oklahoma 3,441,451,894 3,937,604,747 87

Oregon 2,797,080,333 3,677,976,463 76

Pennsylvania 14,206,934,568 17,231,560,151 82

Rhode Island 1,492,164,387 1,893,290,969 79

South Carolina 4,640,158,035 5,098,527,910 91

South Dakota 716,509,192 713,353,957 100

Tennessee 7,197,427,171 7,290,231,215 99

Texas 18,542,742,821 23,704,821,993 78

Utah 1,867,632,519 1,628,633,714 115

Vermont 969,805,347 1,190,678,054 81

Virginia 5,518,557,224 5,774,994,043 96

Washington 5,733,929,571 6,603,087,308 87

West Virginia 2,588,751,602 2,434,058,051 106

Wisconsin 5,754,921,788 6,684,081,412 86

Wyoming 551,809,947 526,237,765 105

Total $323,120,029,363 $366,486,147,093 88%

Source: GAO analysis of Centers for Medicare & Medicaid Services’ data.

Note: MSIS = Medicaid Statistical Information System
Appendix III: Total Adjusted Medicaid 

Expenditures in MSIS and CMS-64, by State, 

Fiscal Year 2009

Page 43 GAO-13-47 Medicaid Data

State MSIS adjusted (dollars) CMS-64 baseline (dollars)

MSIS adjusted as a

percent of CMS-64

Alabama $4,149,081,465 $4,415,801,712 94%

Alaska 1,044,650,976 1,069,624,574 98

Arizona 8,950,429,121 8,665,269,493 103

Arkansas 3,566,963,553 3,451,516,646 103

California 37,800,029,701 41,389,559,881 91

Colorado 3,469,734,861 3,555,155,172 98

Connecticut 5,565,391,332 6,035,281,239 92

Delaware 1,243,966,462 1,211,814,329 103

District of Columbia 1,998,599,795 1,626,139,477 123

Florida 14,754,686,816 15,088,582,200 98

Georgia 7,835,521,037 7,693,345,212 102

Hawaii 1,209,812,682 1,308,211,194 92

Idaho 1,320,590,808 1,276,526,247 103

Illinois 12,053,935,834 13,140,383,274 92

Indiana 5,488,175,214 5,906,490,283 93

Iowa 2,895,286,487 2,960,114,156 98

Kansas 2,391,474,252 2,443,675,864 98

Kentucky 5,170,171,436 5,400,899,512 96

Louisiana 6,117,964,332 6,513,211,836 94

Maine 1,530,105,787 2,517,981,111 61

Maryland 6,308,462,604 6,523,939,093 97

Massachusetts 10,223,698,086 12,480,644,429 82

Michigan 10,671,661,360 10,583,215,243 101

Minnesota 9,661,603,386 7,387,421,506 131

Mississippi 3,458,893,939 3,947,805,053 88

Missouri 6,348,322,455 7,747,665,625 82

Montana 730,414,065 875,768,845 83

Nebraska 1,559,900,885 1,616,257,729 97

Nevada 1,305,273,428 1,383,003,611 94

New Hampshire 1,210,132,665 1,327,164,314 91

New Jersey 9,240,294,628 9,667,209,281 96

New Mexico 2,720,776,943 3,290,379,397 83

New York 47,601,163,307 49,368,510,253 96

North Carolina 10,037,581,856 11,506,119,180 87

North Dakota 580,335,888 572,101,389 101

Appendix III: Total Adjusted Medicaid 

Expenditures in MSIS and CMS-64, by State,

Fiscal Year 2009
Appendix III: Total Adjusted Medicaid 

Expenditures in MSIS and CMS-64, by State, 

Fiscal Year 2009

Page 44 GAO-13-47 Medicaid Data

State MSIS adjusted (dollars) CMS-64 baseline (dollars)

MSIS adjusted as a

percent of CMS-64

Ohio 14,470,087,279 14,150,220,981 102

Oklahoma 3,541,362,801 3,937,604,747 90

Oregon 2,950,571,584 3,677,976,463 80

Pennsylvania 15,215,057,372 17,231,560,151 88

Rhode Island 1,630,860,669 1,893,290,969 86

South Carolina 5,117,449,890 5,098,527,910 100

South Dakota 720,846,348 713,353,957 101

Tennessee 7,363,722,376 7,290,231,215 101

Texas 20,378,285,311 23,704,821,993 86

Utah 1,881,512,781 1,628,633,714 116

Vermont 1,000,491,043 1,190,678,054 84

Virginia 5,749,185,155 5,774,994,043 100

Washington 6,150,885,067 6,603,087,308 93

West Virginia 2,582,401,847 2,434,058,051 106

Wisconsin 5,653,921,737 6,684,081,412 85

Wyoming 550,456,264 526,237,765 105

Total $345,172,184,969 $366,486,147,093 94%

Source: GAO analysis of Centers for Medicare & Medicaid Services’ data.

Note: Adjustments were made by adding expenditures reported in CMS-64 to those reported in the 

Medicaid Statistical Information System (MSIS). Specifically, we added Disproportionate Share 

Hospital payments, national and state rebates for prescription drugs, Medicaid health insurance 

payments, and Medicare premiums to the expenditures reported in MSIS.
Appendix IV: Adjusted MSIS Expenditures as a 

Percentage of CMS-64, by State, Fiscal Year 

2009

Page 45 GAO-13-47 Medicaid Data

Note: Adjustments were made by adding expenditures reported in CMS-64 to those reported in the 

Medicaid Statistical Information System (MSIS). Specifically, we added Disproportionate Share 

Hospital payments, national and state rebates for prescription drugs, Medicaid health insurance 

payments, and Medicare premiums to the expenditures reported in MSIS.

Appendix IV: Adjusted MSIS Expenditures as 

a Percentage of CMS-64, by State, Fiscal Year 

2009
Appendix V: Adjusted MSIS Expenditures as a 

Percentage of CMS-64, by State and 

Expenditure Category, Fiscal Year 2009

Page 46 GAO-13-47 Medicaid Data

Appendix V: Adjusted MSIS Expenditures as 

a Percentage of CMS-64, by State and 

Expenditure Category, Fiscal Year 2009
Appendix V: Adjusted MSIS Expenditures as a 

Percentage of CMS-64, by State and 

Expenditure Category, Fiscal Year 2009

Page 47 GAO-13-47 Medicaid Data
Appendix V: Adjusted MSIS Expenditures as a 

Percentage of CMS-64, by State and 

Expenditure Category, Fiscal Year 2009

Page 48 GAO-13-47 Medicaid Data

Note: Four states—Maine, Mississippi, Vermont, and Wyoming—reported $0 in expenditures related 

to the managed care and Medicaid premium assistance category. 

Adjustments were made by adding expenditures reported in CMS-64 to those reported in the 

Medicaid Statistical Information System (MSIS). Specifically, we added Disproportionate Share 

Hospital payments, national and state rebates for prescription drugs, Medicaid health insurance 

payments, and Medicare premiums to the expenditures reported in MSIS. No adjustments were made 

for acute and long-term support services (LTSS)-noninstitutional and LTSS-institutional.
Appendix VI: GAO Contact and Staff 

Acknowledgments

Page 49 GAO-13-47 Medicaid Data

Carolyn L. Yocom, (202) 512-7114 or yocomc@gao.gov

In addition to the contact named above, Robert Copeland, Assistant 

Director; Muriel Brown; Shaunessye Curry; Greg Dybalski; Sandra 

George; Giselle Hicks; Drew Long; Jessica Morris; and Monica Perez 

Nelson made key contributions to this report.

Appendix VI: GAO Contact and Staff 

Acknowledgments 

GAO Contact

Staff 

Acknowledgments 
Related GAO Products

Page 50 GAO-13-47 Medicaid Data

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Focus on Audit Collaboration with States. GAO-12-627. Washington, 

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