Herald-Whig View

Medicaid paid out $36.3 billion improperly in fiscal 2016

Posted: Feb. 27, 2017 11:25 am

REMEMBER all of those political stump speeches about "cutting waste and abuse" in government? Medicaid has just become the poster child for that reform effort.

The U.S. Government Accountability Office released more reports last month on government payment errors. The mammoth Medicaid program, which covers 70 million people, had a budget of $576 billion last year, and made $346 billion in total payments. Unfortunately, $36.3 billion of those payments were improper -- an error rate of 10.5 percent.

Despite ongoing efforts to improve data quality and eligibility screening, the problem is getting worse, rising from a 9.8 percent error rate in fiscal year 2015.

"We and others have expressed long-standing concerns about the completeness, accuracy and timeliness of available Medicaid data, and the effect of these inefficiencies on (the Centers for Medicare and Medicaid Services') ability to ensure the fiscal integrity of the program," the GAO scolded. "CMS's continued reliance on inaccurate, incomplete and untimely data, and the ongoing uncertainty about the scope and timing of its remedial actions, is inconsistent with federal internal control standards. As a steward of the program, CMS must take immediate steps to ensure the appropriate use of scarce federal and state dollars."

Or else what, though? It is extremely unlikely that any heads are going to roll for such ongoing mismanagement. That accountability has always been the problem with federal government programs, particularly the very large ones.

President Donald Trump and House Republicans have suggested converting Medicaid to a block grant to states as part of their Obamacare reforms. Though block grants are not a panacea, and large states would still struggle with many payment errors, devolving power to the states could help reduce waste and fraud, while eliminating a layer of bureaucracy and offering the states more flexibility.

Whatever happens, Medicaid is long overdue for a shake-up. The GAO report should be a sobering wake-up call that tax dollars are being squandered.