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Q & A: Post-Mortem: Misspent Medicaid Dollars

October 23, 2019
With U.S. Senator Chuck Grassley - R-Iowa , Toledo Chronicle, Tama News-Herald

Q: Why is it so difficult to stop federal benefits flowing for deceased Medicaid recipients?

A: Although it seems like there ought to be a simple flip of a switch, the federal agency distributing Medicaid dollars doesn't have in place an accountable mechanism to stop federal benefits from flowing on behalf of a deceased recipient. From farm payments to health care benefits, I keep check on federal payment systems that distribute hard-earned tax dollars for public benefits and government services.

Unfortunately, I've found the U.S. Treasury's funding pipeline too often becomes a sieve as it winds its way through the federal bureaucracy. Between defrauded payments and fiscal mismanagement, there are countless loopholes to plug and payment liabilities to fix.

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U.S. Senator Chuck Grassley

Restoring fiscal integrity is an endless, but important, task to protect tax dollars and strengthen government programs that serve the American people. As a taxpayer watchdog, I work to trim bureaucratic bloat and integrate transparency tools so taxpayers get the most bang for the buck. For example, I have worked to fix flawed systems at the USDA that sent payments to deceased farmers and to stop fugitive felons from defrauding Social Security benefits.

As then-chairman of the Senate Finance Committee in 2001, I held a hearing to scrutinize payment errors in federal health programs and called upon the Department of Health and Human Services (HHS) to step up and shut down these improper payments.

Returning as chairman in the 116th Congress, I've sharpened my oversight axe to restore fiscal integrity to the federal-state Medicaid program. This program serves tens of millions of low-income families and individuals with disabilities. Rooting out waste, fraud and abuse is a never ending grind that I'm committed to championing for as long as it takes.

Every misspent dime diverted for a deceased beneficiary weakens Medicaid for those who depend on it for preventive care, lifesaving health care and services to promote independent living. Recent federal audits identified recurring payment risks to managed care organizations for deceased persons.

In October, I wrote the Centers for Medicare and Medicaid Services (CMS) to deliver yet another wake-up call that solutions are sorely needed. A few years ago, the Government Accountability Office (GAO) took a snapshot of four states to compare beneficiary and provider identity with the Social Security Administration's data bank.

The audit found at least $9.6 million of unallowable payments were made in 2011, on behalf of at least 200 deceased individuals. Nearly a decade later, it begs another question.

How many hundreds of millions of dollars since then have been misspent on behalf of deceased individuals across all 50 states and U.S. territories?

Last year, the GAO highlighted failures by CMS to implement and develop robust and accountable safeguards to curb payment risks in Medicaid managed care. More recent federal audits by the Inspector General at HHS show this fiscal stain hasn't been erased, identifying more than $200 million in unallowable payments to managed care organizations on behalf of dead patients.

Improper payments have plagued federal health programs for decades. As chairman of the Senate Finance Committee, which has legislative and oversight jurisdiction of Medicaid, I won't allow this fiscal mess to be swept under the rug. Just consider if the federal government took over the entire U.S. health care system for 320 million Americans; the hundreds of millions of dollars in improper Medicaid payments would look like a spit in the ocean.

Q: What will it take to fix improper Medicaid payments?

A: As the saying goes, an ounce of prevention is worth a pound of cure. In my letter to CMS, I called upon the federal agency to implement reforms that will recoup and prevent wasteful Medicaid payments, as well as intensify efforts currently underway at the agency.

In addition to sharpening its tools to recover improper payments, CMS also needs to identify accountability measures to prevent states from continuing to make improper payments for deceased beneficiaries when there are prospective efforts to stop this fraud currently on the books.

For example, implementing guidelines for states to identify providers or managed care organizations that have a track record for improper claims for the deceased is a good place to redouble efforts.

It makes common sense for CMS to adopt policies that track and compare death records with other government agencies. Every dime that goes down the drain to improper payments burdens the taxpayer to pay even more for health care services for Medicaid patients.

Better quality control standards are needed to ensure contractors, providers and managed care organizations work together to achieve compliance with basic eligibility requirements.

For example, state Medicaid agencies ought to regularly cross-check the Social Security Administration's death records to verify an individual's eligibility. If the SSA and USDA can figure it out, so should CMS. I've also asked CMS to identify any changes in law or regulatory reforms that would help fix flaws in the system. As long as I'm in the U.S. Senate, I'll keep working to bring fiscal integrity to federal programs paid for by taxpayers.



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