Medicaid audits include important findings but should be kept in context

By JEANIE DONOVAN | Policy Director, Louisiana Department of Health

Medicaid is arguably the most impactful public program in the state, and that’s why the Louisiana Department of Health (LDH) has a steadfast commitment to maintaining the program’s integrity. Medicaid promotes the health and wellbeing of 1.7 million low-income Louisianans. While recent audit findings released by the Louisiana Legislative Auditor are used by some as evidence that improper enrollment and fraud are pervasive in Louisiana’s Medicaid program, that is far from reality.

Improper enrollment and recipient fraud in Medicaid are the exceptions rather than the rule. Also, it is important to distinguish that recent legislative audits primarily identified cases of human error or neglect rather than actual fraud, which is defined by the federal government as the intentional provision of false information to get Medicaid. One audit by the Legislative Auditor estimated about 3% of all Medicaid expansion enrollees had wages above the eligibility limit after enrolling in the program and did not self-report their excess wages to the Department, as required by the state’s eligibility policy. Another audit identified five Medicaid expansion cases in which a caseworker’s error or failure to follow established protocol resulted in individuals who earned above the income limit being improperly enrolled in Medicaid.

It is important to remember that Medicaid expansion enrollees who had incomes above the eligibility limit did not receive any direct payments. Instead, the funding went to health insurers and healthcare providers responsible for delivering services to those individuals. What’s more, between federal Medicaid funding and premium taxes paid by health insurers to fund Medicaid expansion in Louisiana, no state general fund dollars are used for Medicaid expansion.

Still, any funding spent on an ineligible person is funding that could have been spent on another important purpose.  That’s why LDH, over the past two years, has greatly enhanced its investment in program integrity functions. Through our new eligibility and enrollment system, LDH is able to reduce caseworker error and more rigorously and regularly verify Medicaid recipients’ eligibility. Our new eligibility system has enhanced functionality that currently checks wage data and will soon check tax data to ensure that all recipients are earning below the eligibility limit, as recommended by the Legislative Auditor.

The department’s new Medicaid Recipient Fraud Investigations Unit is investigating cases and collaborating with the Louisiana Attorney General’s office to prosecute cases of Medicaid fraud. Recently, the Trump administration’s Centers for Medicare and Medicaid Services shared several of LDH’s Medicaid program integrity efforts for others states to consider.

LDH staff take the audit findings very seriously and have worked diligently to incorporate the recommendations of the Legislative Auditor into the Medicaid program. It is important, however, that the magnitude of the audit findings not be overstated or misrepresented. The vast majority of Medicaid recipients are eligible for the program and use their Medicaid health coverage to access needed medical care. The program is improving and saving lives in every town, city and parish across the state of Louisiana — a fact that is often overlooked or diminished in the ongoing conversations about program integrity.