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Haley Barbour Pushes Back on Medicaid Fraud

by Benjamin Domenech on March 8, 2011

I’ve criticized Haley Barbour pretty heavily over the past two months regarding his health policy views on a Mississippi health insurance exchange, but that’s not about to stop me from pointing out when he’s being unfairly criticized on other matters. In this case, The Washington Post‘s fact checker, Glenn Kessler, gives Barbour “four Pinocchios” for a comment Barbour made in a hearing last week (full text below the break) regarding a hypothetical scenario where people driving BMWs claim they can’t afford their co-payment on Medicaid and get away with it.

The flaw in Kessler’s fact check is an erroneous assumption regarding Medicaid eligibility requirements — that the people involved have no way to disguise their income levels. The key element of Barbour’s comment is not the legitimately poor population on Medicaid, but rather seniors with a lifetime of accrued wealth who have proven ingenious time and again in hiding their income in order to qualify for Medicaid dollars.

In fact, Governor Andrew Cuomo in New York — no political ally of Barbour’s — has been pushing a crackdown on exactly this type of “wealthy Medicaid moocher,” as the New York Post describes them — booting more than 8,000 seniors off of the program’s home care funding in the process:

Under current law, residents applying for home- care services often transfer assets to a spouse or other relatives in order to qualify for Medicaid. A spouse or other family member living with the home-care patient then refuses to make his or her income available to contribute to the costs of the service, thus sticking Medicaid, and, therefore, taxpayers, with the tab. Under the Cuomo plan, the income of the entire household must be included when applying for Medicaid home-care services to determine eligibility.

Several states have been dealing with these problems, but New York has some of the best stories in recent memory — including millionaires pretending to be paupers and others (including medical professionals) perfectly willing to lie on forms for some free cash.

Barbour’s point, in context, is that there are plenty of people who have in the recent past gotten away with rampant defrauding of the Medicaid system, and that hiding your household income for the program’s purposes is actually quite easy. A need for strengthened ability on the part of states to enforce Medicaid eligibility requirements is paramount, particularly as President Obama’s health care law expands the program dramatically in the coming years.

The text of the Barbour hearing exchange:

REP. SCHAKOWSKY: Thank you. Governor Barbour, you have talked about the reason that infant mortality rates, et cetera, are up in Mississippi, and also, you were talking about — in terms of Medicaid, “we have people pull up at the pharmacy window in a BMW and say they can’t afford their co-payment.”

Well, first of all, let me say that the federal government has made fraud in Medicare and Medicaid a top priority and has for the first time really put resources into doing that. But would you say that Mississippi uniquely — because other states — it’s really provider fraud that is the bulk of the fraud that goes on in Medicare and Medicaid, asking for reimbursements of care that really wasn’t given, or prescription drugs. Would you say in your state it’s your people who are defrauding, the big problem in fraud?

GOV. BARBOUR: Congresswoman, in — my understanding is that that’s not considered fraud, that in the federal rules if a person says they can’t afford to pay the co-payment, the provider can’t challenge it. And, of course, the sad thing about that for us is the state doesn’t save any money. It’s the provider who gets shorted. But I report that because providers report it to me. It is not my understanding that that is, quote, “fraud” under the federal law. We have really done a good job of tamping down on our error rate, including fraud.

REP. SCHAKOWSKY: So you do — so it’s really people trying to cheat the — you know, it’s not — it’s not about — it’s about poor people or not-so-poor people trying to cheat the system that’s been the big problem?

GOV. BARBOUR: We certainly had a problem at one time of people who were not eligible being on the program, and it was the state’s fault because the state was not following the rules. But do we have provider fraud? Yes, ma’am, we do, and we also have waste from providers as well.

REP. SCHAKOWSKY: Which all of us I think agree we have to go after.

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