Problems With Orange County Computer System Could Jeopardize Medi-Cal Reimbursement for Mental Health Services

Orange County could lose millions of dollars in Medi-Cal reimbursements because a new computer system installed to process and submit Medi-Cal claims to the state does not work properly, the Orange County Register reports. The system is intended to centralize mental health patients' medical records and submit claims to the state for services eligible for Medi-Cal reimbursement, but it "immediately malfunctioned" when it was launched in September, according to the Register. David Riley, chief compliance officer for the Orange County Health Care Agency, said that some of the problems with the system arose because the state now requires all Medi-Cal claims to be filed in a new format -- which neither the new computer system nor the previous system could replicate -- to comply with provisions of the Health Insurance Portability and Accountability Act. As a result, county Health Care Agency officials have hired temporary workers to process claims using the previous system to avoid penalties of as much as 50% of the amount eligible for reimbursement if the claims are not submitted within six months. To date, county workers have submitted about 75% of the claims for September. Each month, Orange County submits between 36,000 and 48,000 claims to Medi-Cal for mental health services.

"This is an embarrassment," county Supervisor Bill Campbell said, adding, "Fortunately, they didn't throw out the old system, or we'd be dead in the water." Bruce Ernst, who oversaw the Orange County project for system developer Cerner, said, "I don't think it's anybody's fault. This is part of the normal process of installing a large system" (Saavedra et al., Orange County Register, 2/13).