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While acknowledging that the Baldacci administration had made progress in repairing its Medicaid computer meltdown, the federal Health and Human Services inspector general nevertheless wants Maine to reprocess some 12 million claims to ensure they had been properly decided. The Office of MaineCare Services may eventually have to take that step, but the state and federal government ought to be able to reassure themselves the claims have been properly processed short of that.

The reason to hesitate on this step is the state’s assertion that it lacks the computer power to carry out the recommendation while continuing its work on new claims. No one wants to see Meltdown II: Return of Medi-Monster. Fortunately, this is a situation

in which, first, there is more time to demonstrate the safeguards in the current system are more than adequate and, second, that running a partial sample of the claims would tell officials whether a full run is necessary.

Maine’s Medicaid disaster is now well known: In January 2005, the state switched over to its new, federally ordered Maine Claims Management System (MECMS), which soon proved to be a spectacular failure. Hundreds of thousands of legitimate claims were rejected by the system, care providers didn’t get paid for many months, the state could not return to its old system and government got a black eye that it wears to this day. Since then, the Baldacci administration has brought in consultants, expanded training, provided interim payments (which have caused their own headaches) and generally remade MECMS.

The backlog of claims is down substantially and the new system appears to run now at least as well as the old one. By next summer, when the final computer shortcomings and claims backlog should both be gone, Maine may have a solid system. The inspector general, however, has legitimate concerns. For instance, the state inadequately documented the changes it made to software, and those changes could be overridden “to force claims through the system for payment.”

Other problems included an inability of the Medicaid computer to communicate with Medicare, making it difficult to process claims for people who qualified for both, an inability of the Maine system to identify overpayments or track letters and invoices with third parties. MECMS also could not quantify overpayments, so the state could not re-collect them.

The state has been testing for these problems, but what the federal government reasonably wants is assurance that its money has been spent properly, in addition to a well-functioning system that can document how funds were dispersed and how they will be dispersed in the future. Maine already is re-running a sample of earlier claims to test for compliance. If a substantial number demonstrate that MECMS eventually processed these claims accurately, the federal HHS might rethink the requirement to rerun all claims.

If not, Maine has until next summer to prepare to reprocess 12 million claims.