Maine State Auditor Matt Dunlap’s office has identified a significant gap in Medicaid oversight, according to its fiscal 2025 audit. The Department of Health and Human Services disputes this finding.

The disagreement is gaining renewed attention as questions about Medicaid spending emerge this week. A separate federal review uncovered at least $45.6 million in improper payments for children’s autism services.

In March, the Maine Office of the State Auditor reported that the Program Integrity Unit could not document how it selected projects and payment reviews covering Medicaid services. Auditors were unable to determine whether monitoring was complete. Finding 2025-064 classified this as a significant deficiency with no questioned costs, requiring documented procedures and evidence supporting review scope.

The Department of Health and Human Services countered that the audit conflated one unit’s annual plan with the entire agency’s oversight program, citing other reviews and controls outside that unit. Auditors maintained those additional controls were not properly documented for the providers and services they identified, leaving the issue unresolved.

The Health and Human Services Office of Inspector General conducted a separate January audit covering Maine’s 2023 fee-for-service payments for children diagnosed with autism. The review found each of 100 sampled enrollee-months included at least one improper or potentially improper claim line. Federal auditors estimated $45.6 million in improper payments, including approximately $28.7 million in federal funds.

The inspector general recommended repayment of the federal share and further review of potentially improper payments, along with improved provider guidance and periodic statewide reviews after payment. Maine conditionally agreed to repay the federal portion and these recommendations.

As of August 31, the federal tracker lists all four recommendations as open and unimplemented, with an update expected November 19. This status does not indicate that Maine has taken no interim steps.

The Electronic Code of Federal Regulations establishes a state Medicaid agency’s duty to maintain statewide monitoring against unnecessary services and excess payments, including assessment of care quality. The regulation requires oversight across the entire state plan rather than treating payment review as optional and mandates attention to service appropriateness and beneficiary care quality.

These requirements connect two critical concerns: protecting public funds and safeguarding patients who rely on Medicaid. A payment system can process claims without ensuring comprehensive safeguards in all required areas.

The ongoing state oversight dispute and federal repayment recommendations remain separate matters, neither of which is resolved by merely describing the other.