The Mega Wastes in Medicaid
by U.S. Representative Barbara Cubin
As our government increases in size, unfortunately, we also see a direct correlation to an increase in wasteful spending. It is not surprising that the more bureaucrats involved, the more careless and out-of-control spending becomes in Washington. Medicaid is just one of several examples of the reckless spending that is becoming quite the trend.
Medicaid was first created in 1965 with other programs included in President Johnson's Great Society Program. Medicaid currently delivers medical services to approximately 63 million Americans at an estimated annual cost to state and federal taxpayers of over $315 billion. The U.S. Office of Management and Budget (OMB) projects that the cost of the Medicaid Program will increase by over 75% over the next five years. Moreover, the National Governors Association has noted that within the next two decades, Medicaid will consume as much as 80-100% of all State revenues. The rising costs have in recent years forced many states to reduce their Medicaid eligibility criteria and benefit packages. This demonstrates that Medicaid spending is exorbitant without even beginning to address the amount of money burned in fraud and other types of abuses within the program.
Egregious cases of Medicaid fraud exist throughout the nation. New York has some of the most atrocious examples of taxpayers being robbed of their hard-earned tax dollars. Its Medicaid program has been under fire frequently for reports of improper overbilling. One example among many in New York is of a Brooklyn dentist who billed Medicaid for performing 991 services in a single day. Jason Mehmet, former Medicaid fraud and abuse investigator in New York City, believes up to 40% of all Medicaid claims in New York are either fraudulent or unnecessary. This is only one state in our nation. Imagine if this is representative of Medicaid practices throughout the country.
Speaking frankly, states and the federal government simply cannot sustain this rate of Medicaid growth without raising taxes or reducing benefits. I refuse to sit back and see this happen in Wyoming. Medicaid must be reformed if we are going to keep it afloat for our nation's most vulnerable citizens. The first place to begin this reforming is with the fraud and abuse rampant in the program.
Unfortunately, the House Democrats' actions last week may reverse altogether efforts already underway to reform and to find savings in the program. H.R. 5613, the Protecting the Medicaid Safety Net, deceptively suggests that it will protect Medicaid. In actuality, the bill does the exact opposite by making the program more vulnerable to abusive practices. The bill imposes a moratorium until April 2009 on new cost-cutting Medicaid policies crafted in response to independent audits of the Medicaid program dating from 1994. The cost to the federal taxpayer for this one-year moratorium alone is $1.65 billion.
The states and our Medicaid providers have good reason to be concerned with many of these regulations. Congress should most certainly work with the Bush Administration to find some middle ground, but this bill is more than just a one year time out. It is no secret Democrats are hoping to see one of their own in the White House next year. If that happens, we may never see these regulations implemented, nor will the federal taxpayer benefit from the $42.2 billion in savings the Congressional Budget Office estimates these regulations will generate over the next ten years.
This decision to delay implementation does not bode well for the prospects of eliminating fraud in Medicaid. Rarely in life do we solve problems by hiding them under a rug, and the case of Medicaid is no different. We need to address this issue immediately. Until we do, taxpayers will continue to be robbed of their hard-earned money.