Senators demand crackdown on Medicaid waste
The federal government has gone more than 25 years without making a serious effort to recover overpayments for bogus Medicaid charges that could run into the billions of dollars, according to two senators demanding an explanation.
Sens. Chuck Grassley, Iowa Republican and chairman of the Finance Committee, and Patrick J. Toomey, Pennsylvania Republican and chairman of the health subcommittee, said they were stunned by a recent report by Louisiana’s auditor that found a large portion of Medicaid beneficiaries weren’t eligible for at least part of the time they were collecting benefits.
“Unfortunately, governmental efforts to ensure Medicaid payments are spent prudently have fallen short,” the senators said.
Medicaid is the federal-state partnership to provide health coverage for the poor.
States run their programs, but the federal government foots part of the bill.
The law was dramatically expanded by Obamacare, and that has swollen the ranks and fed the problem, the senators said in their letter to Seema Verma, administrator of the Centers for Medicare and Medicaid Services.
Some states are reporting that high percentages of people enrolled in Medicare under the relaxed rules of Obamacare should have been ruled ineligible.
“We’re thrilled they are looking at it because it’s a huge problem, one of the major scams happening in welfare programs today,” said Sam Adolphsen, a vice president at the Foundation for Government Accountability. “Ineligible people swelling the rolls is taking away resources from the very people Medicaid is supposed to help.”
Obamacare made the problem worse by allowing states to review and purge their Medicaid lists of ineligible beneficiaries only once a year, Mr. Adolphsen said.
“Essentially, the Obama administration was telling states to forgo the program’s integrity in a rush to boost its numbers,” he said.
While officials said there have been some indications that CMS and the Trump administration are interested in working with the senators on the problem, CMS declined to discuss the matter, saying it would respond to the senators directly.
In the upcoming 2020 budget, the department has requested more money to improve CMS’s ability to recoup improper Medicaid payments.
CMS, in its budget presentation, blamed “current law and regulations” for limiting the agency’s ability to recover overpayments. It proposed clawback authority beyond the current improper payment structure.
There is some concern on the Hill that while CMS wants to appear serious about combating Medicaid fraud, not enough of its efforts are directed toward improper beneficiaries.
Consequently, the senators asked Ms. Verma to detail any efforts CMS has made since 1992 to recover overpayments and to provide information on the erroneous payment rates of individual states.
It wasn’t immediately clear why federal officials have not acted before, though the senators said there appeared to be a decision more than 20 years ago to focus “on prospective improvements in eligibility determinations rather than disallowances.”
The federal government must take the lead in policing ineligibility and overpayments because a perverse incentive structure gives states little reason to do, the senators said.
That’s because Washington picks up much of the tab for regular Medicaid and almost all of the bill for those added under Obamacare.
They pointed to recent state studies of new beneficiaries that detected a range of ineligible participants, from 7 percent in Kentucky to between 25 and 30 percent in California and New York, to “an astounding 82 percent” in a random sample selected in Louisiana, the senators note.
The senators told Ms. Verma that they would like to work with CMS either in ramping up enforcement efforts or providing the agency with new legal tools for clawing back misspent dollars.
“Our offices would like to work with you on our shared goal of ensuring that the government complies with the intent and plain language of … the Social Security Act by discouraging systematic and routine errors in Medicaid eligibility determinations by states,” the senators wrote. “We believe that CMS’ past actions have ignored its requirements under the law.”