Medicaid pays for vital health services to 3 million Ohioans, among them the oldest and youngest

Medicaid pays for vital health services to 3 million Ohioans, among them the oldest and youngest and poorest of the state’s residents. There are over 110,000 providers of Medicaid-funded services in the state, the vast majority of whom are honest and conscientious.

But with numbers such as these, there are bound to be instances of providers being paid money to which they are not entitled. In 2016, the Ohio Department of Medicaid paid providers more than $22 billion. Even a small percentage of improper billings add up to a lot of wasted taxpayer dollars.

It’s the job of state Auditor Dave Yost to hold to account those who don’t provide quality service, who can’t prove that they’ve provided the services they’ve been paid for or who are attempting to defraud the state.

Yost is doing yeoman’s work in that regard, but chasing down the horse after it is out of the barn is less efficient than locking the barn door. The General Assembly can help lock that door, and there’s legislation in the works to do that. Senate Bill 218, introduced by Sen Peggy Lehner, R-Kettering, in October, targets providers that are the greatest risk of improperly billing the state for services.

“For too long, dishonest providers have exploited vulnerabilities in the Medicaid program with little consequence,” Yost said. “A stronger system of controls is necessary to protect the program’s vital resources and the citizens who need them most.”

The bill, Yost says, would require at-risk providers to obtain surety bonds that would help the state recover losses caused by fraud and improper payments. Indiana, Texas, Florida and New York use a similar approach.

It also would require providers to complete training in billing, records retention and Medicaid compliance before becoming certified to provide Medicaid services.

Committee hearing

SB 218 awaits its first committee hearing, and the longer the General Assembly waits, the longer unscrupulous or unqualified providers will be able to collect payments to which they are not entitled.

Yost released a special report last week detailing the costs and dangers of Medicaid noncompliance in the state. In the past seven years, Yost’s office has performed compliance examinations of 133 Medicaid providers. Of those, 121 were paid more than $33 million for care they were not certified to offer or for services they couldn’t prove they provided.

Yost came to Youngstown, where the office reported that five Mahoning County providers had improperly billed the state for more than $650,000 – ranging from $614 to $458,000.

The challenges facing the auditor’s office range from providers who keep bad records to providers who attempt to stonewall examiners. And of special concern to taxpayers are those providers who have taken money from the state, can’t prove they’re entitled to keep it, but don’t have the resources to make repayment. That’s why SB 218’s provision requiring that providers be bonded is important.

Though the auditor’s office has been able to identify improper payments, a follow-up analysis of 60 errant providers showed that only about 10 percent of the millions they owed the state had been collected.

Any driver who has kept an eye on the vehicles on the road in recent years has noticed the proliferation of vans, some pristine and some bordering on dilapidated, carrying various markings identifying them as medical transport vehicles. It should come as no surprise that transportation and another industry that has burgeoned – home health care providers – account for 86 percent of the $33 million in overpayments identified by the auditor’s office since 2011.

Too often, when their shoddy record keeping or outright fraud is uncovered by the auditor’s office, the providers simply close up shop, leaving few if any assets from which the state can seek compensation.

Had Ohio had $10,000 and $50,000 surety bonds in place, as SB 218 would provide and as Yost advocates, the state could have recovered $1.2 million from the errant providers the auditor’s office exposed. That’s a small percentage of the state’s losses, but requiring bonds might discourage undercapitalized or underqualified potential providers from seeing Medicaid as a cash cow or easy mark.

The state would save money and the quality of Medicaid service providers in Ohio would be improved.

There’s more to be done to reduce waste and fraud by Medicaid providers and clients, and the job falls to multiple state agencies and to county Departments of Job and Family Services. SB 218 isn’t a panacea; it’s a good start.