The disastrous implementation of North Carolina’s new Medicaid claims software, which physicians in the state say caused more than one-half billion dollars in unpaid or delayed medical claims, is being challenged in a class action lawsuit.
Seven physician practices in the state are alleging the “NCTracks” software, implemented by the North Carolina Department of Health and Human Services (DHHS), was developed and launched with full knowledge of a laundry list of problems.
The court’s judgment will determine whether the North Carolina Medicaid program can be required to pay physicians for the unpaid treatment and services given to Medicaid participants.
NCTracks was launched July 1, 2013, nearly two years after its intended August 2011 go-live date, and cost nearly double the original budget of $265 million. The suit alleges that vendors retained by DHHS implemented software known to be problematic from use in other states and that the other DHHS vendors named as defendants in the suit failed to complete full testing, resulting in a “defective product” that caused financial damages to the class action participants.
“In some instances, providers have decided not to accept Medicaid patients or have even closed their practices, and some of North Carolina’s most needy citizens have suffered a reduction in the health care resources available to them,” the suit, filed Jan. 16, stated.
The North Carolina Medical Society, which is backing the case along with financial support from the Litigation Center of the AMA and State Medical Societies, said it believes NCTracks has systematically misapplied Medicaid payment rules, and DHHS and its vendors have been unresponsive to physician complaints.
The software had more than 3,200 errors in its first few months of operation. Problems with NCTracks alleged in the suit include:
- Physicians were prevented from or hindered in performing necessary tasks, such as checking Medicaid recipient eligibility or creating and checking the status of claims.
- Co-payment amounts were incorrectly applied, shortchanging physician payments.
- Payment increases mandated by the Affordable Care Act were never implemented.
- Claims for injections and vaccines were rejected without explanation.
- Some physicians were denied all payments because their data files had not been converted properly from the old Medicaid software to NCTracks.
Additionally, key vendors have not implemented some legislative or regulatory mandated changes by their required implementation dates, the suit alleges. NCTracks was designed in a manner that “put the state of North Carolina out of compliance with applicable law.”
Visit the AMA Litigation Center Web page to learn more about this case and similar litigation in which it has been involved across the country.
