Medicaid Personal Care Services: More Harmonized Program Requirements and Better Data Are Needed
Published: 2017-05-02T00:00:00

Fast Facts:
A growing number of people rely on Medicaid personal care services for help with daily tasks like bathing and eating. However, these types of services are at high risk for fraud and abuse—e.g., services that were paid for but never provided.
We testified that federal and state rules for protecting Medicaid beneficiaries varied across personal care services programs. We also found that Medicaid needs better data to oversee these programs.
In our reports on the topic, we've recommended that the program rules be harmonized and that better guidance be issued to states for reporting the required data.

Highlights:
section_title: Why GAO Did This Study
paragraphs: Medicaid, a joint federal-state health care program, provides long-term services and supports for disabled and aged individuals, increasingly in home and community settings. Federal and state Medicaid spending on home- and community-based services was about $80 billion in 2014. Personal care services are a key component of this care. States can offer personal care services through many different types of programs, and each may be subject to different federal requirements established by statute, regulations, and guidance. The provision of personal care in beneficiaries' homes can pose safety risks, and these services have a high and growing rate of improper payments, including cases where services for which the state was billed were not provided. In recent years Congress has directed HHS to improve coordination of these programs which could harmonize requirements--that is, implement a more consistent administration of policies and procedures--and enhance oversight.
This statement highlights key issues regarding (1) the federal program requirements to protect beneficiaries' safety and ensure that billed services are provided, and (2) the usefulness of data collected by CMS for oversight. This testimony is based on reports GAO issued in 2016 and 2017. For these reports, GAO assessed CMS data on personal care services provided to beneficiaries and state spending. GAO also reviewed federal statutes, regulations, and guidance, and interviewed CMS officials.
section_title: What GAO Found
paragraphs: In its November 2016 report, GAO found a patchwork of federal requirements related to how states must protect the safety of beneficiaries in their personal care services programs and to how states ensure that billed services are actually provided. Personal care services help beneficiaries with basic activities of daily living such as bathing and dressing, in a home- or community-based setting. For two types of programs under which personal care services can be offered, states must describe to the Centers for Medicare & Medicaid Services (CMS) how they will ensure the health and welfare of beneficiaries. Similar requirements were not in place for several other programs GAO examined. In addition, for some but not all personal care services programs that GAO reviewed, states must provide evidence to CMS that the state is paying claims for services that have actually been provided. These differing federal program requirements result in uneven beneficiary safeguards and levels of assurances regarding states' beneficiary protections and oversight of billed services. GAO recommended that CMS take steps to harmonize and achieve a more consistent application of federal requirements across programs. CMS agreed with GAO's recommendation and sought input on how to do so by publishing a request for information.
In its January 2017 report, GAO found limitations in the data that CMS collects to monitor the provision of personal care services and to monitor state spending on services. For example:
Data on personal care services provided were often not timely, complete or consistent. The most recent data available during GAO's review (2016) were for 2012 and included data for only 35 states. Further, 15 percent of claims lacked provider identification numbers and 34 percent lacked information on the quantity of services provided. Data were also inconsistent as more than 400 different procedure codes were used by states to identify personal care services. Without timely, complete, and consistent data, CMS is unable to effectively oversee state programs and verify who is providing personal care services or the type, amount, and dates of services provided.
Data on states' spending on CMS's expenditure reports, the basis for states' receipt of federal matching funds, were not always accurate or complete. From 2012 through 2015, 17 percent of expenditure lines were not reported correctly by states, according to GAO's analysis. Nearly two-thirds of these errors were due to states not separately identifying personal care services expenditures, as required by CMS, from other types of expenditures. Inaccurate and incomplete data limit CMS's ability to, among other oversight functions, ensure federal matching funds are appropriate.
GAO made several recommendations to improve the data CMS collects to monitor the provision of and expenditures on personal care services. CMS agreed with some but not all of these recommendations.

section_title: Letter
paragraphs: I am pleased to be here today as you examine the personal care services  benefit available under Medicaid, the federal-state health financing  program for low-income and medically needy individuals. Medicaid is the  nation’s primary payer of long-term care services and supports for  disabled and aged individuals who may need care for an extended period  of time. Personal care services are a significant and important component  of Medicaid’s long-term care services and supports. Personal care  services provide assistance to beneficiaries of all ages who have limited  ability to care for themselves because of physical, developmental, or  intellectual disabilities, helping them with activities of daily living such as  bathing, dressing, and toileting. Such assistance can enable disabled and  aged beneficiaries to remain in their homes, maintain their independence,  and participate in community life to the fullest extent possible.
Medicaid spending on long-term care services and supports is significant,  representing more than one-quarter of Medicaid spending annually. The  federal cost of Medicaid long-term care spending is expected to increase  from $75 billion in 2015 to $111 billion in 2026. Historically, Medicaid  spending for long-term care has been largely for services provided in  institutional settings, such as nursing homes. In recent years, this trend  has changed and the majority of federal and state spending has shifted  towards home- and community-based services (HCBS)—that is, services  and assistance provided to beneficiaries in their homes or other settings  integrated with their communities. As a result of the aging of the nation’s  population and increased opportunities for aged and disabled individuals  to live in their homes instead of institutions, the demand for and spending  on HCBS and personal care services is expected to increase.
Although personal care services are an important support for Medicaid  beneficiaries, provision of these services is not without risk, both for  beneficiary safety and for improper Medicaid payments. Beneficiaries  receiving personal care services include aged individuals and individuals  with physical, developmental, or intellectual disabilities, some of whom  can be vulnerable. Also, when personal care services are provided in a  private home, other providers or community members may not be present  to help discourage or report on questionable activities. These factors can  result in some beneficiaries being at risk of unintentional harm and  potential neglect and exploitation. A beneficiary’s capacity to manage  finances and secure possessions may decline with age, onset of  dementia, or other cognitive disabilities, and put them at risk of theft or  financial exploitation from unscrupulous attendants. Moreover,  depending on the particular state and Medicaid program, personal care  attendants who provide services may not be required to have a credential  from an organization that trains workers for certain qualifications. The  provision of personal care services is also at high risk for Medicaid  improper payments, including instances where services for which the  state was billed were not provided. The Centers for Medicare & Medicaid  Services (CMS), an agency within the U.S. Department of Health and  Human Services (HHS), estimated that about 12 percent of all states’  payments for personal care services in 2015 were improper—twice the 6  percent error rate estimated for 2014—and that the projected dollar  amount of payment errors was over $3.6 billion, up from $2 billion  estimated for 2014.
As the agency overseeing Medicaid at the federal level, CMS is  responsible for overseeing state Medicaid programs, including protecting  Medicaid fiscally from improper payments, ensuring that all beneficiaries  are protected, and collecting data from states on Medicaid spending for  services, and the types and volume of services provided, to carry out its  oversight responsibilities. CMS also provides states with guidance on  federal program requirements. Personal care services can be provided  under many different authorities under Medicaid, and states have  developed many different types of programs for delivering personal care  and other home- and community-based services. In recent years,  Congress has directed HHS to improve coordination of these programs,  which could harmonize requirements—that is, implement a more  consistent administration of policies and procedures. Specifically, in 2010  Congress required HHS to take steps to improve the coordination among,  and regulation of all, providers of home- and community-based services  to achieve a more consistent administration of policies and procedures  across programs.
We issued a report in each of 2016 and 2017 examining the federal  oversight of Medicaid personal care services provided by state Medicaid  programs. My remarks today are based primarily on these two reports  and will focus on our assessment of:  1.  federal program requirements to ensure the safety of Medicaid  beneficiaries receiving personal care services and to ensure that  billed services are actually provided; and  2.  the extent CMS collects data that can be used to monitor the provision  of and spending on personal care services by state Medicaid  programs.
My remarks on the federal program requirements to ensure the safety of  Medicaid beneficiaries and to ensure that billed services are provided are  based on our 2016 report. For that report, we reviewed applicable federal  laws, regulations, and guidance, including state reporting requirements  specific to Medicaid personal care services programs. We also reviewed  personal care services programs in four states, selected to include  variation in the types of such programs. In addition, we reviewed reports  by CMS and HHS Office of the Inspector General relating to personal  care services and interviewed CMS officials. My remarks on the data  CMS collects on Medicaid personal care services are based on our 2017  report. For that report, we analyzed data collected by CMS on personal  care services provided to beneficiaries and on state Medicaid spending  on those services. For services provided, we analyzed Medicaid provider  claims and managed care encounter data for calendar year 2012—the  most recent and complete data available at the time of our 2016  analysis—for 35 states that had finalized 2012 data. For spending, we  also analyzed Medicaid expenditure data for all 50 states and the District  of Columbia for calendar years 2012 through 2015. Additional  information on our scopes and methodologies are included in the 2016  and 2017 reports.
We conducted the work on which this statement is based in accordance  with generally accepted government auditing standards. Those standards  require that we plan and perform the audit to obtain sufficient, appropriate  evidence to provide a reasonable basis for our findings and conclusions  based on our audit objectives. We believe that the evidence obtained  provides a reasonable basis for our findings and conclusions based on  our audit objectives.
subsections: section_title: Background
subsections: section_title: Medicaid Program
paragraphs: Medicaid is jointly financed by the federal government and the states, with  the federal government matching most state Medicaid expenditures using  a statutory formula that determines a federal matching rate for each state.  Medicaid is a significant component of federal and state budgets, with  estimated total outlays of $576 billion in fiscal year 2016, of which $363  billion is expected to be financed by the federal government and $213  billion by the states. Medicaid served about 72 million individuals, on  average, during fiscal year 2016.
As a federal-state partnership, both the federal government and the  states play important roles in ensuring that Medicaid is fiscally sustainable  over time and effective in meeting the needs of the populations it serves.  States administer their Medicaid programs within broad federal rules and  according to individual state plans approved by CMS, the federal agency  that oversees Medicaid.
Federal matching funds are available to states for different types of  payments that states make, including payments made directly to  providers for services rendered under a fee-for-service model and  payments made to managed care organizations:
Under a fee-for-service delivery model, states make payments directly  to providers; providers render services to beneficiaries and then  submit claims to the state to receive payment. States review and  process fee-for-service claims and pay providers based on state- established payment rates for the services provided.
Under a managed care delivery model, states pay managed care  organizations a set amount per beneficiary; providers render services  to beneficiaries and then submit claims to the managed care  organization to receive payment. Managed care plans are required to  report to the states information on services utilized by Medicaid  beneficiaries enrolled in their plans—information typically referred to  as encounter data.
Most states use both fee-for-service and managed care delivery models,  although the number of beneficiaries served through managed care has  grown in recent years.
Federal law requires each state, under both fee-for-service and managed  care delivery models, to operate a claims processing system to record  information about the services provided and report this information to  CMS:
Provider claims and managed care encounter data are required to  include information about the service provided, including the general  type of service; a procedure code that identifies the specific service  provided; the location of the service; the date the service was  provided; and information about the provider who rendered the  service (e.g., provider identification number).
Fee-for-service claims records must include the payment amount.
Federal law requires states to collect managed care encounter data,  but actual payment amounts to individual providers are not required.
section_title: Long-Term Services and Supports, Home and Community Based Services, and Personal Care Services
paragraphs: Long-term services and supports financed by Medicaid are generally  provided in two settings: institutional facilities, such as nursing homes and  intermediate-care facilities for individuals with intellectual disabilities; and  home and community settings, such as individuals’ homes or assisted  living facilities. Under Medicaid requirements governing the provision of  services, states generally must provide institutional care to Medicaid  beneficiaries, while HCBS coverage is generally an optional service.  Medicaid spending on long-term services and supports provided in home  and community settings has increased dramatically over time—to about  $80 billion in federal and state expenditures in 2014—while the share of  spending for care in institutions has declined, and HCBS spending now  exceeds long-term care spending for individuals in institutions (see fig.  1). All 50 states and the District of Columbia provide long-term care  services to some Medicaid beneficiaries in home and community  settings.
Personal care services, a key type of HCBS, are typically nonmedical  services provided by personal care attendants—home-care workers who  may or may not have specialized training. The demand for personal care  services is expected to increase as is the number of attendants providing  these services in coming years. The number of Medicaid beneficiaries  receiving personal care services at this time is not known, but likely in the  millions. In calendar year 2012, the most recent and complete available  data, an estimated 1.5 million beneficiaries in the 35 states reporting at  the time received personal care services at least once. Total Medicaid  spending for personal care services is also not known, as spending in  managed care delivery systems is not reported by service. Total Medicaid  spending for personal care services in fee-for-service delivery systems  was about $15 billion in FY 2015.
section_title: Types of Personal Care Services Programs
paragraphs: With approval from CMS, states can choose to provide personal care  services under one or more types of authorities (referred to in this  statement as programs) put in place over the past 41 years under  different sections of the Social Security Act. The various types of  programs provide states with options for permitting participant direction  and choices about how to limit services, among other things (see table 1).
CMS has implemented the different statutory requirements associated  with these various program types by issuing regulations, as well as  guidance to help states implement their Medicaid programs in accordance  with applicable statutory and regulatory requirements. Guidance can  include letters to state Medicaid directors, program manuals, and  templates to help states apply for CMS approval to provide certain  services like personal care. Together with federal statutes, the regulations  and guidance issued by CMS establish a broad federal framework for the  provision of personal care services. States are responsible for  establishing and administering specific policies and programs within the  federal parameters laid out in this framework.
section_title: Federal Program Requirements for Maintaining Beneficiary Safety and Ensuring That Billed Services Are Provided Differ Significantly
paragraphs: In our 2016 report examining the federal program requirements for the  multiple programs under which personal care services are provided, we  found significant differences in federal requirements related to beneficiary  safety and ensuring that billed services are provided. These differences  may translate to differences in beneficiary protections across program  types. Program requirements can include general safeguards for ensuring  beneficiary health and welfare, quality assurance measures, critical  incident monitoring, and attendant screening. For example, states  implementing an HCBS Waiver program or a State Plan HCBS program  must:
Describe to CMS how the state Medicaid agency will determine that it  is assuring the health and welfare of beneficiaries. To do so, states  must describe: the activities or processes related to assessing or  evaluating the program; which entity will conduct the activities; the  entity responsible for reviewing the results of critical incident  investigations; and the frequency at which activities are conducted.
Demonstrate to CMS, by providing specific details that an incident  management system is in place, including incident reporting  requirements that establish the type of incidents that must be  reported, who must report incidents, and the timeframe for reporting.
In contrast, states implementing a State Plan personal care services  program or a Community First Choice program have fewer requirements  for beneficiary safeguards. For example, for these programs, states are  not required to do the following:
Provide CMS with detailed information describing the activities they  are taking to assure the health and welfare of beneficiaries.
Demonstrate to CMS specific details about their critical incident  management process and incident reporting system; instead they are  required to describe more generally their “process for the mandatory  reporting, investigating and resolution of allegations of neglect, abuse,  or exploitation.”
Table 2 below illustrates more broadly the differences in federal program  requirements that establish beneficiary safeguards and protections that  we identified in our 2016 report.
Differences in federal program requirements may also result in significant  differences in the level of assurance that billed services are actually  provided to beneficiaries. States implementing HCBS Waiver programs  and State Plan HCBS programs, for example, are required by CMS to  provide evidence that the state is only paying claims when services are  actually rendered, while the State Plan personal care services and  Community First Choice programs are not required to do so.
Table 3 below highlights the federal Medicaid personal care services  program requirements that we identified in our 2016 report to ensure that  billed services are provided for each of the different type of HCBS  program states may administer.
The four selected states we examined as part of our 2016 report used  different methods to ensure attendants provided billed services to  beneficiaries, according to state officials. For example, for at least some  personal care services programs, two states required beneficiaries to sign  timesheets, and two states used electronic visit verification timekeeping  systems. All four states performed quality assurance reviews for some  personal care services programs to ensure billed services are received.
The differing federal program requirements can create complexities for  states and others in understanding federal requirements governing  different types of HCBS programs, including personal care services.  These different requirements may also result in significant differences in  beneficiary safeguards and fiscal oversight, as illustrated in the following  examples:
Beneficiaries may experience different health and welfare safeguards  depending on the program in which they are enrolled. For example, in  one state we reviewed in 2016, the state required quarterly or  biannual monitoring of beneficiaries for most of its personal care  services programs. In contrast, for another program, the state  required only annual monitoring contacts, in part, officials told us, due  to the differing program requirements. Depending on the program  type, CMS may have fewer assurances that beneficiaries’ with similar  levels of need are in programs with similar protections. For example,  three of the four states we reviewed—Maryland, Oregon, and Texas— have in recent years transitioned coverage of personal care services  for beneficiaries who need an institutional level of care from personal  care services programs with relatively more stringent federal  beneficiary safety requirements to programs with relatively less  stringent requirements. Although they were not required to do so,  state officials in the three states reported that the states chose to  continue using the same quality assurance measures in the new  programs as the best way to ensure safety for beneficiaries. Without  more harmonized requirements, we concluded that CMS has no  assurance that states that transition personal care services from  HCBS Waivers to Community First Choice in the future will make the  same decisions.
States can use different processes for each personal care services  program to ensure that billed services are actually provided, and  some programs may not be subject to federal personal care services  requirements explicitly in this regard. For example, in one state we  reviewed in 2016, steps taken to ensure billed services are provided  under some types of personal care services programs were not  required in another of the state’s programs.
A report we issued in 2012 reviewing states’ implementation of different  HCBS programs also suggested that states could benefit from more  harmonization of program requirements. Officials in selected states we  reviewed in 2012 noted the complexity of operating multiple programs.  For example, officials from one state reported that the complexity resulted  in a siloed approach, with different enrollment, oversight, and reporting  requirements for each program. The administration and understanding of  the programs available to beneficiaries was difficult for state staff and  beneficiaries, according to officials in another state. The officials indicated  that they would prefer CMS issue guidance on how states could operate  different HCBS program types together, rather than issuing guidance on  each program separately.
In our 2016 report, we acknowledged certain efforts CMS had taken to  harmonize requirements and improve oversight of personal care services  programs. However, despite these efforts, we found that significant  differences in program requirements existed. We recommended that CMS  take additional steps to better harmonize and achieve a more consistent  application of program requirements, as appropriate, across the different  personal care services programs in a way that accounts for common risks  faced by beneficiaries and to better ensure billed services were provided.  CMS agreed with these recommendations, and has sought input by  publishing a request for information on numerous topics related to  Medicaid home and community-based services, including input on how to  ensure beneficiary health and safety and program integrity across  different types of personal care services programs.
section_title: Data on Personal Care Services Collected by CMS were Often Not Timely, Complete, Consistent, or Accurate Claims and Encounter Data Were Not Timely, Complete, or Consistent
paragraphs: In our 2017 report examining the data CMS uses to monitor the provision  of personal care services, we found that claims and encounter data  collected by CMS were not timely. Data are typically not available for  analysis and reporting by CMS or others for several years after services  are provided. We found that this happens for two reasons. First, although  states have 6 weeks following the completion of a quarter to report their  claims data, their reporting could be delayed as a result of providers and  managed care plans not submitting data in a timely manner, according to  the CMS contractor responsible for compiling data files of Medicaid  claims and encounters. For example, providers may submit claims for  fee-for-service payments to the state late and providers may need to  resubmit claims to make adjustments or corrections before they can be  paid by the state. Second, once complete MSIS data are submitted by the  states, the data must be compiled into annual person-level claims files  that are in an accessible format, checked to identify and correct data  errors, and consolidated for any claims with multiple records. This  process, for one year of data, can take several years and, as a result,  when information from claims and encounters becomes available for use  by CMS for purposes of program management and oversight it could be  several years old.
We also found that Medicaid personal care services claims and encounter  data that CMS collects were incomplete in two ways. First, specific data  on beneficiaries’ personal care services were not included in the calendar  year 2012 MSIS data for 16 states, as of 2016, when we conducted our  analysis. Nevertheless, these 16 states received federal matching funds  for the $4.2 billion in total fee-for-service payments for personal care  services that year—about 33 percent of total expenditures for personal  care services reported by all states (see figure 2).
Second, even for the 35 states for which 2012 MSIS claims and  encounter data were available, certain data elements collected by CMS  were incomplete. For example, for the records we analyzed, 20 percent  included no payment information, 15 percent included no provider  identification number to identify the provider of service, and 34 percent  did not identify the quantity of services provided (see figure 3).
Incomplete data limit CMS’s ability to track spending changes and  corroborate spending with reported expenditures because the agency  lacked important information on a significant amount of Medicaid  payments for personal care services. For example, among the 2012  claims we reviewed for personal care services under a fee-for-service  delivery model, claims without a provider identification number accounted  for about $4.9 billion in total payments. Similarly, payments for fee-for- service claims with missing information on the quantity of personal care  services provided totaled about $5.1 billion. These data gaps represented  a significant share of total personal care services spending, which totaled  about $15 billion in fee-for-service expenditures in 2015.
Even when states’ claims and encounter data collected by CMS was  complete, we found that it was often inconsistent, which limits the  effectiveness of the data to identify questionable claims and encounters.  For purposes of oversight, a complete record (claims or encounters)  should include data for each visit with a provider or caregiver, with dates  of when services were provided, the amount of services provided using a  clearly specified unit of service (e.g., 15 minutes), and the type of  services provided using a standard definition. Such a complete record  would allow CMS and states to analyze claims to identify potential fraud  and abuse. The following examples illustrate inconsistencies in data  regarding when services were provided and the types of services that  were provided from the 35 states whose data we reviewed:
When services were provided. State-reported dates of service were  overly broad. In the 35 states, some claims for personal care services  had dates of services (i.e., start and end dates) that spanned multiple  days, weeks, and in some cases months. For 12 of the 35 states, 95  percent of their claims were billed for a single day of service.  However, in other states, a number of claims were billed over longer  time periods. For example, for 10 of the states, 5 percent of claims  covered a period of at least 1 month, and 9 states submitted claims  that covered 100 or more days. When states report dates of service  that are imprecise, it is difficult to determine the specific date for which  services were provided and identify whether services were claimed  during a period when the beneficiary is not eligible to receive personal  care services—for example, when hospitalized for acute care  services.
Type of services provided. States used hundreds of different  procedure codes for personal care services. Procedure codes on  submitted claims and encounters were inconsistent in three ways: the  number of codes used by states; the use of both national and state- specific codes; and the varying definitions of different codes across  states. More than 400 unique procedure codes were used by the 35  states. CMS does not require that states use standard procedure  codes for personal care services; instead, states have the discretion  to use state-based procedure codes of their own choosing or national  procedure codes. As a result, the procedure codes used for similar  services differed from state to state, which limits CMS’s ability to use  this data as a tool to compare and track changes in the use of specific  personal care services provided to beneficiaries because CMS cannot  easily compare similar procedures by comparing service procedure  codes.
subsections: section_title: Medicaid Expenditure Data Collected by CMS Were Not Always Accurate or Complete
paragraphs: In our 2017 report we found that Medicaid personal care services  expenditure data collected were not always accurate or complete,  according to our analysis of expenditure data collected by CMS from  states for calendar years 2012 through 2015. When submitting  expenditure data, CMS requires states to report expenditures for personal  care services on specific reporting lines. These reporting lines correspond  with the specific types of programs under which states have received  authority to cover personal care services, and can affect the federal  matching payment amounts states receive when seeking federal  reimbursement. For example, a 6 percent increase in federal matching is  available for services provided through the Community First Choice  program. For three other types of HCBS programs, CMS also requires  states to report their expenditures for personal care services separately  from other types of services provided under each program on what CMS  refers to as feeder forms—that is, individual expenditure lines for different  types of services that feed into the total HCBS spending amount for each  program.
We found that not all states were reporting their personal care services  expenditures accurately, and, as result, personal care services  expenditures may have been underreported or reported in an incorrect  category. We compared personal care services expenditures for all states  for calendar years 2012 through 2015 with each state’s approved  programs during this time period and found that about 17 percent of  personal care services expenditure lines were not reported correctly. As illustrated in figure 4, nearly two-thirds of the reporting errors were a  result of states not separately identifying and reporting personal care  services expenditures using the correct reporting lines, as required by  CMS. Without separate reporting of personal care expenditures as  required, CMS is unable to ensure appropriate federal payment, monitor  how spending changes over time across the different program types and  have an accurate estimate of the magnitude of potential improper  payments for personal care services. The other types of errors involved  states erroneously reporting expenditures that did not correspond with  approved programs. As a result, CMS is not able to efficiently and  effectively identify and prevent states from receiving federal matching  funds inappropriately, in part because it does not have accurate fee-for- service claims data that track payments by personal care program type  that is linked with expenditures reported for purpose of federal  reimbursement.
These errors demonstrated that CMS was not effectively ensuring its  reporting requirements for personal care expenditures were met. We  concluded that by not ensuring that states are accurately reporting  expenditures for personal care services, CMS is unable to accurately  identify total expenditures for personal care services, expenditures by  program, and changes over time. According to CMS, expenditures that  states reported through MBES are subject to a variance analysis, which  identifies significant changes in reported expenditures from year to year.  However, CMS’s variance analysis did not identify any of the reporting  errors that we found. CMS officials told us that they would continue to  review states’ quarterly expenditure reports for significant variances and  follow up on such variances.
In our 2017 report, we acknowledged certain efforts CMS had taken to  improve the data it collects. However, these efforts had not addressed  data issues we identified that limited the usefulness of the data for  oversight. We recommended that CMS take steps to improve the  collection of complete and consistent personal care services data and  better monitor the states’ provision of and spending on Medicaid personal  care services. Specifically, CMS agreed with recommendations to better  ensure states comply with data reporting requirements and to develop  plans for analyzing and using the data. The agency neither agreed nor  disagreed with recommendations to issue guidance to ensure key data  regarding claims and encounter data are complete and consistent, or with  a recommendation to ensure claims data can be accurately linked with  aggregate expenditure data. In light of our findings of inconsistent and  incomplete reporting of claims and encounters, errors in reporting  expenditures, and the high-risk of improper payments, we believe action  in response to these recommendations is needed.
In conclusion, Medicaid personal care services are an important benefit  for a significant number of Medicaid beneficiaries and amount to billions  of dollars in spending to the federal government and states. The demand  and spending for personal care services continues to grow. However, the  services are not without risk. Personal care services are at high risk for  improper payments and beneficiaries may be vulnerable and at risk of  unintentional harm and potential neglect and exploitation. Over the years,  federal laws have given states a number of different options to provide  home- and community- based services. Having various options for  providing personal care services provides flexibilities for states in how  they administer their programs and provide services to different groups of  beneficiaries. At the same time, our work has also found a patchwork of  federal requirements, resulting in varying levels of beneficiary safeguards  and requirements to ensure that billed services are actually provided. As  a result, beneficiaries with similar needs could be receiving services in  programs with significantly different safeguards in place, depending on  the program. Similarly, the level of assurance that billed services are  actually provided could vary based on the type of program. Further, our  work showed that the data CMS collects for oversight of these programs  is not always timely, complete, accurate, and consistent. Without better  data, CMS is hindered in effectively performing key management  functions related to personal care services, such as ensuring state claims  for enhanced federal matching funds are accurate. CMS has taken steps  to improve the data it collects from states, and to establish more  consistent administration of policies and procedures across the programs  under which personal care services are provided. However, we found  additional steps are warranted.
Chairman Murphy, Ranking Member DeGette, and Members of the  Subcommittee this concludes my prepared statement. I would be pleased  to respond to any question that you might have at this time.
section_title: GAO Contact and Staff Acknowledgments
paragraphs: If you or your staffs have any questions about this testimony, please  contact Katherine M. Iritani at (202) 512-7114. Contact points for our  Offices of Congressional Relations and Public Affairs may be found on  the last page of this statement. Individuals making key contributions to  this testimony include Tim Bushfield, Assistant Director; Anna Bonelli;  Christine Davis; Barbara Hansen; Laurie Pachter; Perry Parsons; and  Jennifer Whitworth.
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