Lawmakers urge Medicaid to slow spending

BOISE – Idaho Department of Health and Welfare officials tried to reassure lawmakers Thursday they’re doing everything they can to keep costs down.

But Senate Finance Chairman Dean Cameron insisted the agency could do more to stop ineligible people from signing up for Medicaid – people he said are “driving SUVs, having their nails done” – to enroll for help under the program reserved for poor people and people with disabilities.

And lawmakers pressed the agency to keep looking at requiring some Medicaid recipients to pay a portion of the costs, a possibility the agency director promised will be explored.

Department leaders told the budget-setting Joint Finance-Appropriations Committee that they’ve trimmed spending by about $150 million by, among other things, requiring prior approval for medications, reducing payments to hospitals and doctors and expanding a managed care program. State taxpayer support represents about a third of that savings.

Still, Gov. Dirk Kempthorne’s proposed taxpayer-supported budget would give the agency $460 million, an increase of 13 percent. And even Kempthorne has acknowledged his figure may be too low, as rising Medicaid costs eclipse the budget he’s proposing.

But Cameron told Health and Welfare officials that even the agency’s employees, surveyed during the state budget crisis in 2003, are aware “that we were enrolling participants who should not and did not qualify for Medicaid services.”

The agency allows would-be Medicaid recipients to sign up for the program and “self-declare” key data such as income.

Cameron said the agency should use a more rigorous examination process to weed out potential unqualified applicants.

“It seems to me there are a few things we can do so those who don’t qualify for Medicaid benefits don’t receive Medicaid benefits,” Cameron said.

But the acting administrator of the Division of Welfare, Greg Kunz, said Cameron is mistaken, and the process in place now does work.

“We did a study about a year ago trying to determine if there were some factual evidence to suggest that there was fraud occurring or that individuals were providing false information,” Kunz told Cameron. “We did not find any evidence of fraud. We did not find that individuals were making statements to become eligible.”

“I’m going to have to tell you that your study must have been flawed,” Cameron fired back, “because I can tell you physicians who can point out individuals who are driving SUVs, having their nails done and are Medicaid-eligible.”

Some Medicaid applicants who are turned away come back with different income information in order to squeeze into the program, Cameron said.

But Senate Health and Welfare Chairman Dick Compton, of Coeur d’Alene, stuck up for the department, relaying his own experiences involving his son, who died last year of Lou Gehrig’s disease.

“The system worked,” Compton said. “When you are a recipient, you realize that (Medicaid) is there to help those people who really need help themselves and are in a tough spot. As a close observer of the system, it worked pretty well.”

Legislative budget writers say the department still hasn’t done enough to explore other cost-saving steps, including requiring Medicaid recipients to pay some nominal fee for services. That’s known as a co-payment.

“I don’t buy this reluctance to go to a co-pay system,” Oakley Republican Rep. Scott Bedke said.

But Health and Welfare Director Karl Kurtz said the issue is being researched, even though federal regulations would restrict it to just a quarter of Medicaid clients.

“We have and will continue to explore co-pay for the remainder of our Medicaid patients,” Kurtz told lawmakers. “Let’s get co-payments addressed, look at the impacts that co-pay has, and let’s get on to address (other) cost-containment issues.”