Timing is everything, isn't it? As Utah and the nation ponder how to reform health care — including a federal proposal to create a cost-effective government option for people who have no insurance — a legislative audit spotlights millions of dollars of waste within Utah's Medicaid program.
Utah's legislative auditor general, in an audit released earlier this week, estimates the state could save $20.2 million if the Utah Department of Health's Bureau of Program Integrity were more diligent about Medicaid fraud. The current system is hobbled by an ineffective, decades-old software system intended to look for providers who submit fraudulent bills. Auditors also found problems with the state's Medicaid authorization process. Sleep studies and surgeries were approved by nurses working for the Department of Health. While some of the procedures may have been medically necessary, thus covered, the matters should have been considered by an established committee of physicians and nurses.
The normally upbeat House Speaker Dave Clark, who is heading up Utah's health-care reform efforts, said of the audit, "I don't know that I've read a more damning report."
While Medicaid is primarily funded with federal funds, a significant amount of state funding supports government health programs in Utah. The state health department's budget exceeds $1.7 billion. The inefficiencies and poor oversight uncovered by legislative auditors mean there are fewer resources to address legitimate needs such as adding qualified individuals — low-income individuals and families, and people with disabilities — to the rolls, let alone address issues that fall outside the scope of the program such as needed dental and vision care.
Health department officials dispute the auditors' estimates on potential savings. Whatever the true figure, it is obvious that cost-recovery tools that are nearly 30 years old are woefully inadequate. For instance, the Surveillance and Utilization Review System doesn't examine 62 percent of providers. That leaves open the possibility for significant fraudulent billing issues or the payment of services or procedures that are unnecessary or not covered by the program.
State health officials say they're looking into an updated system. It would seem a small price to pay when even health department officials say the returns that could be realized by a new system could be between $1 million and $9 million.
Perhaps the larger question is, why didn't health department officials themselves recognize the limitations and pitfalls of using decades-old technology and convince state lawmakers and federal officials to fund system upgrades years earlier?
Using updated tools is but part of the problem. Employees did not follow statutes or their own guidelines. Internal auditing mechanisms have been ineffective. Some employees lack the latitude to do their jobs properly. Some authorized procedures, studies and prescription medications that were unnecessary or not covered by the program.
As Utah attempts to overhaul other aspects of the state's health-care system, it is beyond troubling that the Medicaid program, which serves the neediest adults, is riddled with such problems. They deserve better. So do Utahns who support this program with their state and federal taxes.