SALEM — The state of Oregon said Tuesday it had dispensed millions of dollars in Medicaid assistance to thousands of Oregonians with no idea whether they were eligible.
The Oregon Health Authority says it is working to clarify whether as many as 115,000 Medicaid recipients have incomes low enough to qualify for the benefits they have been receiving.
As the Affordable Care Act vastly expanded the Medicaid population in Oregon, the state got approval to skip the normal once-a-year eligibility check on its Medicaid clients. Recipients did qualify initially, agency officials said, but the state failed to check to ensure they still qualified. The lack of regular checks, coupled with lingering technological issues with the agency’s computer systems, has led to the current situation, they said.
Officials declined to offer a ballpark estimate of how much Medicaid assistance may have been wrongfully dispensed. But they confirmed they are in the process of terminating 14,000 Medicaid recipients who were receiving benefits but failed to respond to their queries. The agency continues to analyze 17,000 more who did respond to determine if they still qualify. That leaves 84,0000 who still must be checked out.
The stakes are huge. The average Medicaid recipient costs the state and federal government about $430 a month. At that rate, even if it is determined that just the 14,000 recipients actually shouldn’t have qualified, the annual outlay could top $72 million a year.
Auditors in the Secretary of State’s office recently began investigating the Health Authority’s handling of the eligibility checks, after discovering the problem during a different audit. The new financial audit is months away from completion, but Secretary of State Dennis Richardson plans to release an “auditor alert” outlining some of the early findings Wednesday morning, according to deputy secretary of state Leslie Cummings.
Richardson campaigned on the promise of auditing several controversial state programs, including Cover Oregon, its disastrous attempt to build an e-commerce website for health insurance.
Republicans have pointed out state auditors within the Secretary of State’s office never audited the program after it failed to launch in fall 2013.
The revelations come as Democrats are trying desperately to save the Affordable Care Act and the increase in the Medicaid rolls that came with it. Obamacare, as it became known, nearly doubled the Medicaid ranks in Oregon to just over a million. Oregon has staked its reputation as a health care innovator in part on the 16 coordinated care organizations established to serve the enlarged Medicaid population.
But President Donald Trump and the Republicans in Congress want to repeal the Affordable Care Act claiming, among other things, the program is too expensive to sustain. Defenders, including Gov. Kate Brown and Oregon Health Authority Director Lynne Saxton, contend hundreds of thousands of Oregonians will lose health care coverage if the law is repealed.
At the same time, Brown and lawmakers are working on a state budget deal that would raise taxes on health care to prevent cuts to Oregon’s Medicaid program. Those budget problems are unrelated to Trump’s and Congressional Republicans’ attempts to repeal or overhaul the Affordable Care Act.
The explosion in the number of Medicaid recipients due to Obamacare posed a record-keeping nightmare for Oregon. The state was already behind the curve due to the failure of Cover Oregon.
Recognizing this, the U.S. Centers for Medicare and Medicaid granted several waivers – the first in 2013 — to the state allowing it to put off routine “redetermination” checks on individual eligibility.
The information technology system intended to replace Cover Oregon had its own issues. The health authority was forced to hire new employees to manually input the names, addresses and other information of Medicaid recipients into the system, a process that took much of 2016 and further delayed the resumption of the normal re-qualification schedule.
“The data transfer required more work, more time and more employees than we expected,” said Jon Collins, a senior technology employee at the health authority.
The health authority has been conducting its own analysis of the backlog, which it says will be complete by the end of the month. The health authority confirmed last year that 700,000 of its Medicaid recipients did qualify, said spokeswoman Courtney Crowell. At the same time, total enrollment in the program fell by more than 90,000, which Crowell said is attributable in part to the stepped up redetermination process.
It has hired Deloitte, the big consulting and accounting firm, to assess its case files.
The federal government covers the bulk of Medicaid costs while Oregon’s share varies from 10 percent to 30 percent of the total. To qualify, an individual in Oregon cannot earn more than $16,643 a year, a family of four no more than $33,948.
Collins and state Medicaid director Lori Coyner said the Health Authority has kept the U.S. Centers for Medicare and Medicaid informed of the situation in monthly calls, and also briefed lawmakers and advisers to the governor.
Brown’s spokesman declined to say when she learned of the situation, which wasn’t explicitly addressed in her December budget proposal.
“Governor Brown’s recommended budget includes several cost-savings measures in the Oregon Health Authority (OHA) budget, including $15 million in savings through strengthening the program’s integrity capabilities,” spokesman Bryan Hockaday said in an emailed statement. “This increased investment will help OHA improve its program to investigate Medicaid and non-Medicaid fraud.”
In a written statement, the health authority said “shares the Secretary of State’s commitment to an accurate eligibility process.”
— Hillary Borrud, Jeff Manning