A solution to Medicaid’s chronic fraud problem

October 22 01:00 2015 by ushadmin

The Obama administration just announced that fighting Medicaid fraud is going to be a “key priority” for the final year of the president’s term.

That’s a tall order. Last year, the program lost more than $17 billion to fraud. That’s on top of more than $14 billion in improper payments in 2013.

Medicaid’s structure actively encourages fraud. Eliminating it will require replacing the status quo, whereby the feds match whatever states spend, with individual block grants that empower states to take control of their own Medicaid programs.

A recent Government Accountability Office report reveals just how corrupt Medicaid has become. In 2014, almost 7 percent of Medicaid payments were “improper.” That’s a polite way of saying that they were the result of either fraud or mismanagement.

The GAO homed in on four states in particular – and discovered that Medicaid wasn’t even stopping the most obvious cases of fraud and abuse.

In 2011, for example, the program paid out $9.6 million in benefits to 200 dead people and $4.2 million to people who were, at the time, sitting in jail. The GAO also found “hundreds of thousands” of claims paid to people living at fake addresses or using fake Social Security numbers.

According to the report, Medicaid made payments to 190 healthcare providers who were dead, had their licenses suspended or revoked, or had been banned from participating in the program…