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When an extra $30 million shows up as a result of a state operated, federally-funded Medicaid program, one can expect Congress will be interested.
A recent $30 million payment from UCare health plan to the state of Minnesota that was described as a “gift” but appeared to be a kind of Medicaid refund recently drew the attention of a Congressional committee investigating Medicaid fraud across the country.
Minnesota Human Services Commissioner Lucinda Jesson was called before the Committee on Oversight and Government Reform to explain the payment. She said it was a “very unique situation” and one the state “didn’t have a playbook for.”
Committee members pressed her more and raised the issue of fraud, to which Gov. Mark Dayton and other members of the state’s congressional delegation rejected out of hand. But there do not appear to be a lot of clear answers here, at least not from the department or Jesson.
Last year, the Dayton administration negotiated a deal with health plans that get state contracts on Medicaid that all profits over 1 percent would be returned to the state. Officials say the $30 million from UCare was above and beyond the $73 million paid back to the state under the 1 percent rule from several health plans.
The $30 million also raised questions at the federal Center for Medicare and Medicaid which argued some of the payment should go to it since it provides the state money for the programs as well.
Jesson told the committee she and Dayton had questions about how the previous administration set contracts with the health care plans. Former Pawlenty administration Human Services Commissioner Kevin Goodno told the Star Tribune he was not aware of anything done in the past that would have been illegal. He had no suspicions of fraud.
But a whistleblower and former general counsel of the Minnesota Hospital Association testified that the $30 million payment was actually reimbursement for overpayments made by the state to UCare, according to a report in the Star Tribune.
The whistleblower, David Feinwachs, said he was fired from his job because he was “asking the wrong questions,” according to the report.
He accused people in state government and private parties of collaborating on the fraud, though his report offered few specifics or direct evidence. Still, the accusations are troubling.
In addition, a recent Minnesota legislative auditor’s report of DHS compliance with things like federal Medicaid programs showed state oversight was mostly solid but short of perfect. While the auditor said DHS “generally complied” with federal laws on the programs, there were some issues of concern raised by the auditor.
One of the findings from that report showed that DHS “allocated some costs to federal programs that may not have been allowable for federal reimbursement.” One such cost, the auditor noted, was a $7.2 million lawsuit settlement with a software company when the state terminated its contract.
The events taken together may lead a reasonable taxpayer to believe that if millions of dollars are coming back in what appears to be a voluntary manner, more scrutiny and independent auditing may bring in even more light to the situation.
This line of investigation is worth continuing.
Editorials
April 26, 2012
Our View: Medicaid scrutiny would be welcomed
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