State misspent $263M in Medicaid mistakes

Virginia committed a major oops in Medicaid enrollment mistakes, worth between $18 million and $263 million in 2009, mostly because of human errors in manually processing applications, according to a Tuesday report from the state's Joint and Audit Review Commission (JLARC), reports The Washington Examiner blog. What's worse is that it will cost even more to correct the improper payments to ineligible recipients and improve on the current system.

There's some disagreement about the $18 million to $263 million range because it's unclear how much the state spent on ineligibles to receive care and how many were treated when their files were incomplete, reports The Virginian-Pilot.

"There's quite a lot of manual work that's done, things like notices, worksheets," Joe Schwartz, a Medicaid eligibility supervisor in Arlington County, told WAMU. "In a lot of ways, the Medicaid is still pretty antiquated."

Analysts blame enrollment errors on outdated and inconsistent eligibility processes and standards, reports The Washington Times. Federal law requires that local departments redetermine whether Medicaid recipients are eligible every 12 months, but they do not consistently.

Lack of documentation to prove Medicaid eligibility cost the state up to $235 million, although the number is likely inflated, according to The Washington Examiner article. Agency errors accounted for $18 million in improper payments, and fraud accounted for $6.1 million, mostly by providers.

Medicaid program costs were $7.2 billion last year, $2.7 billion of which Virginia paid, according to The Virginian-Pilot.

Errors cost the federal government anywhere between $26 million to $397 million, according to The Washington Examiner article.

For more information:
- read the WAMU article
- here's The Virginian-Pilot article
- see The Washington Examiner blog post
- read The Washington Times article
- here's the JLARC report (.pdf)

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