California signed up an estimated 450,000 people under Medicaid expansion who may not have been eligible for coverage, according to a report by the Health & Human Services’ chief watchdog.
In a Feb. 21, the HHS’s inspector general estimated that California spent $738.2 million on 366,078 expansion beneficiaries who were ineligible. It spent an additional $416.5 million for 79,055 expansion enrollees who were “potentially” ineligible, auditors found.
Auditors said nearly 90% of the $1.15 billion in questionable payments involved federal money, while the rest came from the state’s Medicaid program, known as Medi-Cal. They examined a 6-month period from Oct. 1, 2014, to March 31, 2015, when Medicaid payments of $6.2 billion were made related to 1.9 million newly eligible enrollees.
There were limitations to the California review, however. The audit extrapolated from a sample of 150 beneficiaries. The authors reported a 90% confidence level in their results – whereas 95% would be more common. That meant that the number of those ineligible could have been as low as 260,000 or as high as 630,000.
“If HHS has a strong reason to believe that California is systematically making enrollment errors, it would be helpful to show that in a more robust analysis,” said Ben Ippolito, a health care economist at the American Enterprise Institute, a conservative think tank. “The federal government should ensure that states are being good stewards of federal money.”
Nonetheless, the audit highlighted weaknesses in California’s Medicaid program, the largest in the nation with 13.4 million enrollees and an annual budget topping $100 billion, counting federal and state money. Medicaid covers one in three Californians.
The inspector general found deficiencies in the state’s computer system for verifying eligibility and discovered errors by caseworkers. The Medicaid payments cited in the report covered people in the state’s fee-for-service system, managed-care plans, drug treatment programs, and those receiving mental health services.