State Medicaid processing issues delay payments, threatening care providers and patients

COLORADO SPRINGS, Colo. (KRDO) -- Changes to the state’s Medicaid processing systems have led to thousands of long-term care patients losing eligibility and therefore losing vital medical services.

The Colorado Department of Health Care Policy and Financing oversees Health First Colorado, the state’s Medicaid program. Last year, the state said it implemented a new case management system while at the same time handling an increased claim workload after the end of COVID-19 protections. The combination of these changes proved to be disastrous for long-term services and support members, as thousands of patients across the state have lost their Medicaid eligibility due to backlogs and system glitches.

“We have so many lives in our hands,” said Paul Strange, the Chief Operating Officer for Stellar Care and Services. “It's not just the individuals that need services, it's the individuals that support them. So when the state does this there is a trickle-down effect.”

Stellar Care and Services provides community-based Medicaid services to individuals with a variety of disabilities. However, with many patients ineligible, Stellar Care and Services is no longer being paid by the state to take care of some of these individuals.

“We're constantly worrying about how do we keep the lights on and pay our staff when there's no money coming in?” Strange said.

Holly Grasso is the at-home care provider for her father, who has a number of health complications, including being blind and having advanced dementia. She’s supposed to be paid through the state to care for her dad, but she said she hasn’t seen a penny since October. She’s now burned through her savings accounts and has racked up thousands in credit card debt.

“I'm in a situation where like, my choice is give him the care and he's supposed to receive and not get paid for it and jeopardize my ability to live, literally be able to pay the cheapest rent in town anywhere. Right. Or neglect him and be, you know, harming him by not being there all the hours that he needs.”

It’s why the state’s processing problems ultimately hurt the patient. Without the money to pay staff, Stellar Care and Services said it’s forced to stop providing care for some of those whose Medicaid eligibility has unexpectedly ended.

“We're having to tell people, ‘I'm sorry, your services are suspended until I have something showing that you're eligible. Without eligibility, I can't serve you and get paid,’” Strange said. “You've got people in limbo with developmental disabilities and they have no one to turn to.”

“I don't know how other families are doing this,” Grasso said. “How anybody is paying their bills, how literally anybody is like managing to do this.”

Stellar Care and Services noticed billing issues in August 2023. Strange said the state has told them to be patient as they work on a solution, but nearly eight months later, Strange has lost his patience.

“I got no money coming in and I got no money to go out,” Strange said. “Then if I don't serve, I'm the bad guy. It kind of feels like the state washes their hands of responsibility and then throws it right back at us.”

“It is incredibly important to me that they have the funding they need to keep their doors open,” said Bonnie Silva, the Office of Community Living Director. “It's incredibly important to me that they have the funding to pay their staff. I don't think patience is an appropriate ask at this point.”

Silva said the Colorado Department of Health Care Policy and Financing said it would expedite a system change to process the backlog of Medicaid eligibility and ensure the system stops accidentally ending a patient’s eligibility, as well as pause all terminations for patients. Any providers who experience issues can escalate their challenges using this form.

“I don’t have fleshed-out timelines for when all of these fixes will be 100% implemented,” Silva said. “I think that we can see that for like the I.T. systems over the next few months, we can anticipate that many of the major issues will be remediated.”