Governors: Give states $4 billion for Medicare mistakes

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HHS Secretary Kathleen Sebelius
HHS Secretary Kathleen Sebelius

The National Governors Association says the federal government owes the states up to $4 billion for wrongfully denying disabled individuals Medicare coverage over the past 30 years.

In a letter to Health and Human Services Secretary Kathleen Sebelius, the NGA claims that disabled people were denied Medicare benefits because of mistakes made by the Social Security Administration. As a result, state Medicaid programs had to foot the bill instead. The SSA, which acknowledges the mistakes, has finished a 10-year program to retroactively correct the errors. In some cases, the SSA billed states for Medicare premiums that were 30 years old.

The NGA letter says the state's budget woes mean they “cannot absorb expenditures that rightfully belong to the federal government.”

"Payment to the states would be in the form of credits to the states to be used as the state share of current Medicaid expenditures," the letter says. "This method of satisfying the federal liability would assure that the federal expenditure for correcting the problem would benefit current Medicaid programs."

Gov. Scott Walker (R-WI), chair of the NGA's Health and Human Services Committee, and Gov. John Kitzhaber (D-OR), signed the letter, the committee's vice chair.