Feds Look the Other Way As Medicaid Fraud Rises

Federal authorities have for years ignored a growing crisis involving a fraud-infested government entitlement program that fleeces U.S. taxpayers out of millions of dollars, according to a shocking new audit released this week.

It would almost seem inconceivable—even for today’s bloated government—if it wasn’t laid out in a report issued this week by the offending agency’s inspector general. It involves personal care services provided by the federal/state-funded health insurance for the poor known as Medicaid. In the late 90s the Supreme Court ruled that unjustified segregation of the disabled is a civil rights violation so Medicaid allocated a chunk of change for home health services.

The idea is to allow the sick, disabled and those with chronic or temporary conditions stay home and, in turn, avoid sticking Uncle Sam with a hefty hospitalization bill. Instead, Medicaid’s personal care services program is rife with corruption that was first exposed more than five years ago and continues to be documented annually by the agency’s watchdog. The budget has ballooned to more than $12 billion a year, just to send what amounts to a nanny to provide supportive “nonmedical services” like meal preparation, housework, help with bathing and getting dressed, transportation and even money management.  

The tab for home care has increased by 35% since 2005 and fraud is on the rise, according to the audit. In 2010 state Medicaid fraud units investigated more than 1,000 cases related to home services. Medicaid recipients can hire practically anyone to help them and collect the money and providers undergo virtually no scrutiny. In fact, auditors list examples of Medicaid recipients hiring juveniles, relatives and girlfriends to provide services. One man was in jail while his girlfriend collected money from the government to supposedly provide him with home care.

None of this is new, in fact the report includes six previous inspector general recommendations to combat the fraud yet none have been implemented. In 2008, for instance, the inspector general issued a report finding that five states paid around $11 million in fraudulent personal care services during one quarter alone. The illegal schemes are only getting worst yet the feds have done little to stop the madness.

Auditors stress the importance of cracking down on the costly fraud, writing that “as more and more State Medicaid programs explore home care options” it is “critical” that “adequate safeguards exist to prevent fraud, waste, and abuse.” Then again, this latest inspector general’s report essentially reiterates past assessments and the feds haven’t bothered to take action.