Auditors release special report on Medicaid program


LITTLE ROCK — The state Medicaid program paid about $1.3 million to ineligible recipients since 2009 because of a lack of internal controls, according to a report released Friday detailing a special audit of the government health program.

The report, compiled by the state Division of Legislative Audit based an audit of selected areas of the $4 billion-a-year program, show a more than 15 percent payment error rate for 2009, a drop to just over 6.5 percent in 2010, down further to 3.27 percent in 2011 and a jump to just over 14 percent in 2012.

Release of the report comes as the Legislature considers Gov. Mike Beebe’s call for expansion of the Medicaid program under the federal Affordable Care Act. State officials say expansion would make basic health coverage available for up to 250,000 of Arkansas’ working poor who cannot currently afford insurance.

Republican legislative leaders have been cool to expanding Medicaid, saying ridding the program of waste, fraud and abuse should be more of a priority. Some have suggesting putting off a decision on expansion until after the current session.

The co-chairmen of the Legislative Joint Audit Committee had asked Legislative Audit to release the audit report Feb. 1, a request that drew complaints from Gov. Mike Beebe’s office and the state Department of Human Services. The lawmakers agreed to a delay.

Legislative Audit posted the report on its website Friday.

The report said errors by DHS included payments to recipients who exceeded income limits, fewer than a half-dozen incidents of payments to illegal immigrants and, in one case, payments to a knowingly ineligible recipient whose case was allowed to remain open for nine years.

It noted a lack of internal controls in each of the years covered, including lack of sufficient staff and inadequately trained workers at county offices.

The special audit focused on areas deemed to be at high risk for fraud, waste and abuse. Among them were ARKids First, Aid to the Aged, Aid to the Disabled, Refugee Settlement, Family Planning and TB (tuberculosis) Services.

DHS spokeswoman Amy Webb said Friday the audit report pointed out areas where the agency had some problems in recent years that have already been addressed along with some new concerns, including some with which the agency disagrees.

“We think the special report shows a couple of things. It shows that Legislative Audit pointed out some areas that needed improvement in 2009, and we took a look at them and we improved it,” Webb said. “Once they felt comfortable with that, they changed their focus to a real complex set of cases and that’s where they found new areas of concern.

“We don’t think those are representative of the entire program. Just as we did in 2009, we’ll take a look at that and see where we can make improvements. We’re responsive to concerns and we take the integrity of the Medicaid program quite seriously.”

Sen. Bryan King, R-Green Forest, co-chairman of the Legislative Joint Auditing Committee, suggested the report’s narrow sampling within Medicaid likely could be followed by a more comprehensive audit of the vast program that serves about 800,000 recipients annually.

“This is a starting point as far as looking into this matter, what’s in the details as far as the errors and how does that apply that later we could be looking more in depth,” King said.

He said he believed a more detailed study of the entire program would provide a clearer picture of potentially substantial losses.

“We’re going to look at what the audit members say, get some feedback and see where we go, but my guess is yes,” he said.