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Audit: Michigan Improperly Spent $160M On Medicaid

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LANSING (AP) - Michigan improperly spent $160 million over three years caring for Medicaid recipients needing in-home services primarily because it failed to obtain invoices and other required documentation from service providers, a damning state audit found Tuesday.

The expenditures accounted for 18 percent of nearly $894 in joint federal-state spending on the Medicaid Home Help Program that serves about 67,000 people a year. Auditors warned that Michigan could be forced to repay nearly $97 million to the U.S. government.

They said state caseworkers did not meet with clients to review their care or talk with home health aides to ensure the patients had not fired them and kept government payments for themselves. The state Community Health and Human Services agencies also probably improperly paid home aides unemployment benefits, including one who was fired by a Medicaid recipient for having illegal drugs and taking the client’s medications, the audit said.

The review of the program covered October 2010 through August 2013 and mostly coincides with Gov. Rick Snyder’s administration. Residents with disabilities or cognitive impairments living at home are helped with eating, bathing, dressing and other activities.

Auditors said nearly 3,800 of roughly 70,000 home health providers had felony convictions, including 572 convictions for violent crimes. The state said it has been considering background checks for years, but clients can hire family members to care for them and may be fully aware and accepting of their criminal history.

The audit also found that the state:

– overpaid 80 agencies $6.8 million by not making sure they met requirements to get higher fees than individual aides.

– hired a contractor in 2008 for $1.4 million to visit DHS county offices over three years to review home health cases, yet the case file reviews were not forwarded to the offices for corrective action on time. The Community Health Department blamed a lack of staff for the delay.

– inappropriately paid $3.5 million for home services when the patients were instead being hospitalized or in nursing homes.

- did not review thousands of W-2 forms returned as undeliverable, missing a chance to crack down on clients fraudulently getting services or their relatives providing a false address to avoid cuts in the clients’ authorized service level.

– failed to create a process for caseworkers to refer suspected fraud to the attorney general’s office.

Spokespeople for the Departments of Community Health and Human Services said they generally agree with the audit conclusions and take them seriously, but questioned the estimated amount of improper payments, saying it was extrapolated from a small sample size.

“DHS Director Maura Corrigan takes the audit finding seriously, as evidenced by her quick response to the audit in reorganizing all adult services under a centralized authority to provide greater accountability,” spokesman Bob Wheaton said.

“We are already in the process of recouping payments from providers where we can,” said DCH spokeswoman Angela Minicuci.

The audit’s release drew criticism from Democratic gubernatorial candidate Mark Schauer, who said taxpayers “deserve better.”

“This audit raises very serious questions about Governor Snyder’s ability to manage the state’s Medicaid program, which provides vital health care services to our seniors and families,” spokeswoman Cathy Cunningham said.

A message seeking comment was left with Snyder, a Republican.

© Copyright 2014 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.

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