The Government Accountability Office (GAO) has released a report entitled “Medicaid: CMS Oversight of Provider Payments Is Hampered by Limited Data and Unclear Policy.”  The report examines how state Medicaid payments to government hospitals compare to those made to private hospitals in selected states (Illinois, New York, and California) and CMS oversight of such payments. Because states receive federal matching funds for their payments to health providers, the GAO observes that states “may have incentives to make excessive Medicaid payments to certain institutional providers such as hospitals operated by local governments.” The GAO notes that its assessment was hampered by inaccurate and incomplete data on payments. For example, the GAO notes that large supplemental payments states often make to hospitals are not reported by the hospital. While some of the available data was inconclusive, the GAO believes that a small number of government hospitals it identified as receiving high payments warrants oversight. With regard to CMS oversight, the GAO observes that CMS has insufficient information on payments, lacks a policy and process for assessing payments to individual providers, and lacks a policy and standard process for determining whether Medicaid payments to individual providers are economical and efficient. The GAO recommends that CMS take steps to ensure states report provider-specific payment data, establish criteria for assessing payments to individual providers, develop a process to identify and review payments to individual providers, and expedite review of the appropriateness of New York's hospital payments. HHS concurred with the recommendations.