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State Medicaid officials detail steps to address pediatric behavioral therapy audit and possible provider billing issues
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Summary
Department officials told the Medical Services Board they are preparing responses to a finalized OIG audit of pediatric behavioral therapy, will pursue targeted prepayment and post-payment reviews, and are considering regulatory and licensing changes to limit potential billing abuses and identify outlier providers.
Department officials told the Colorado Medical Services Board they are taking multiple steps in response to a finalized Office of Inspector General audit of pediatric behavioral therapy billing.
Adela Flores Brennan, a Medicaid director with the department, said staff have begun compiling provider-level data to identify billing outliers and will implement both prepayment and post-payment reviews in targeted areas. "We are starting both prepayment and post payment reviews on providers or specific codes so that we can identify if there's any gaming going on," she said.
Board members pressed staff on the state's ability to challenge OIG extrapolations and on how far back the department can look to recoup payments. A department official explained that CMS and OIG may extrapolate findings from sampled months to estimate improper payments and that the department must respond to requests from CMS to determine any federal disallowance. The department also said it lacks the same extrapolation authority in its own audits and that individual claim reviews remain resource-intensive.
Board members and providers discussed options including license requirements for centers that provide pediatric behavioral therapy, development of clearer regulations for the PBT benefit, and a possible single assessment tool to standardize clinical need and billing criteria. Adela said she expects some elements to require higher-touch reviews and that resource constraints will shape the scope of audits.
The board heard that an Inspector General brief and national reporting in The Wall Street Journal prompted the department to assemble responses and that the department will supply CMS with its formal responses as that federal review proceeds.

