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AUDIT NOTES SAVINGS BY LIMITING SERVICES FOR MEDICAID OVERUSERS

SHARE AUDIT NOTES SAVINGS BY LIMITING SERVICES FOR MEDICAID OVERUSERS

Placing Medicaid recipients who overuse medical services in a restricted program to control access to health services may reduce costs by as much as 53 percent. But the restriction program is underused and the administrative process cumbersome.

That's the finding of a performance audit of Medicaid recipient controls, conducted by the office of the legislative auditor general at the request of the Utah Legislature. The audit was presented to the audit subcommittee of the Legislative Management Committee on Tuesday morning.Lawmakers have been concerned about rising Medicaid costs and overuse of some services, particularly hospital emergency rooms for non-emergency care. In 1993, the state Medicaid budget was $462 million. State and local governments paid one-fourth of the cost and federal matching funds made up the balance.

Nearly 80 percent of all Medicaid recipients are in programs to control costs by using a primary care physician to coordinate services. But the Division of Health Care Finance, which administers Medicaid, also established a restriction program to identify people with high medical service usage rates.

The audit examined 22 restricted cases and concluded that "overall costs went down by 53 percent and use of specific services decreased by as much as 77 percent for the sample population's first year on the program."

Because the sample was not random, auditors said the savings projections might not be representative of all restricted Medicaid users. But it indicated that the state could save a great deal of money by putting more people on restrictions.

The study compared routine medical care and excluded in-patient hospital stays and emergency room use for life-threatening conditions.

"Restricting more recipients who show signs of excessive use or abuse would create additional cost savings and provide controlled care for more recipients," it concluded.

The audit also called for simplified paperwork, streamlined appeals process and asked Health Care Financing officials to find ways to measure program effectiveness and better educate Medicaid recipients.