House Republicans are pushing a slew of bills that attempt to cut back on Medicaid fraud by reforming eligibility and closing loopholes that enable lottery winners to get coverage.
But Democrats are concerned that some of the measures could have unintended consequences.
The House Energy and Commerce Committee’s health subcommittee looked at six bills during a Friday hearing. The bills target certain eligibility loopholes that could be used for fraud, a pervasive problem with the government program that gives health coverage to low-income U.S. residents.
“The increasing size, complexity and vulnerability of Medicaid have led the [federal watchdog Government Accountability Office] to designate it a ‘high-risk’ program that can too easily be subjected to fraud and abuse,” said subcommittee Chairman Joseph Pitts, R-Pa.
Medicaid gives states a wide berth to design and implement their own programs.
The biggest fraud problem is making improper payments to people who are ineligible for Medicaid or payments to providers for services that weren’t provided, the GAO said. Last year, the federal government paid an estimated $17.5 billion in improper Medicaid payments, the federal watchdog added.
One of the bills would count lottery winnings or similar lump sums toward Medicaid eligibility.
Income eligibility for Medicaid applicants and new enrollees is based on monthly household income. Therefore, a lump sum gained by lottery or gambling winnings or an inheritance is counted as income “only in the month received,” a subcommittee report said.
Because of these regulations, lottery winners could keep their Medicaid coverage, the report said. The bill would allow states to consider any lump sum payments as if they were obtained over multiple months, even if they were obtained in only one month.
Other bills would stop healthcare providers who are terminated from the Medicaid program in one state for committing fraud from applying for Medicaid reimbursements in another state.
Democrats largely supported some of the legislation, but were skeptical about the bill on lottery winners.
A problem, for example, is if a parent receives a lump sum but a child is actually the Medicaid enrollee.
“As we all know, the majority of Medicaid enrollees are children,” said Rep. Lois Capps, D-Calif.
Capps wondered if a child would lose eligibility for Medicaid due to the parent’s lump sum, despite how the parents spend that money. Trish Riley, a commissioner of the nonpartisan Medicaid and Children’s Health Insurance Program Payment and Access Commission, said the bill has the potential to do that.
The agency conducts nonpartisan studies on the Medicaid and CHIP programs.
“That lump sum would ensure that child was not eligible for a long time,” Capps said.
Capps said she couldn’t support the bill because it “may seem very attractive but underneath there are some unintended consequences.”
“We have some work to do here,” said Rep. Kathy Castor, D-Fla.
It is not clear how many Medicaid recipients are in fact lottery winners. The subcommittee report said that last year one state, which was not identified, reported that about 6,000 lottery winners were receiving, or were a member of a family receiving, Medicaid benefits.
About 200 of those people got winnings of $20,000 or more.
The committee hasn’t scheduled a markup of the six Medicaid bills.
