Medicaid claims audits come up short, report suggests

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Peter Budetti, Director of Program Integrity, the Centers for Medicare & Medicaid Services
Peter Budetti, Director of Program Integrity, the Centers for Medicare & Medicaid Services
The federal program tasked with detecting Medicaid fraud costs more to operate than it has recovered in overpayments, a government investigation found.

Since 2008, the government has spent $102 million on its Medicaid audit program, which has only identified less than $20 million in overpayments, according to a report released Thursday by the Government Accountability Office. The report found that close to two-thirds of 1,550 audits of state records were characterized as “unproductive” by the GAO, as they identified $7.4 million in possible Medicaid overpayments since 2008.

Peter Budetti, the Centers for Medicare & Medicaid Services' director of program integrity, told Bloomberg News that audits conducted by 10 contractor companies have been discontinued, while the remaining five contractors will be dropped or reassigned.

Federal officials acknowledged last week in a Congressional hearing that recovery of overpayments by Medicaid auditors has lagged behind their Medicare counterparts. Nursing homes, which are largely funded by Medicaid, have come under increased scrutiny under these audit programs.

A congressional hearing will be held today to discuss the GAO's findings. Click here to read the report.