Sen. Steve Daines criticized the state of Montana on Wednesday during a Senate subcommittee hearing, saying its policies on Medicaid has made it more at risk to abuse and fraud compared to other states.
He made his comments after noting the U.S. government improperly spent $36 billion in Fiscal Year 2018.
“The sad reality is that for every dollar that is lost to waste, fraud and abuse means a lost investment in improving the health and well-being of vulnerable Montanans,” the Montana Republican said.
He noted a 2018 report from the Montana Legislative Audit Division that he said found Montana is more at risk to welfare waste and abuse.
“That is deeply concerning,” he said.
He said Montana is one of seven states that does not verify income data prior to enrollment and said a review of 100 cases showed income errors in income in 24% of cases. And he said those discrepancies were not followed up.
The head of the Montana Department of Public Health and Human Services, which oversees Medicaid, defended the program. She said her department runs an effective Medicaid program while following all applicable laws and regulations, including policies and procedures that determine eligibility.
“The value of Medicaid is indisputable,” Director Sheila Hogan said, adding Medicaid expansion was reauthorized in the 2019 Legislative session with bipartisan support and by lawmakers who know the “critical economic and lifesaving benefits” it provides to Montanans.
“It’s disappointing to hear Senator Daines unfairly criticize the very program that has kept rural hospitals open, brought millions of taxpayer dollars back to Montana, created jobs, bolstered our economy, and improved the health of thousands of Montanans,” she said.
Hogan said the 2018 Montana legislative audit did not find fraud, waste and abuse.
“The audit was about evaluating risk. We concurred with nearly all of the recommendations as we are committed to making improvements to the Medicaid program that focus on preventing fraud, waste, and abuse. She said various DPHHS agencies focus on preventing such problems.
Daines made his comments during a hearing by the Senate Finance Subcommittee on health care.
Daines asked Brian Ritchie, assistant inspector general under the Health and Human Services Department, if he was surprised Montana had not followed up on the discrepancies.
“It’s not worth doing if you are not going to follow through,” Ritchie said.
The Montana State Legislature mostly recently approved Medicaid expansion during the 2019 session. It approved a bill that provides health care to nearly 90,000 Montanans.
Gov. Steve Bullock signed the Health and Economic Livelihood Partnership (HELP) act, in 2015 with a provision for it to sunset June 30, 2019. It was touted as a uniquely Montana solution in which recipients participate in a workplace program to help them get better-paying jobs.
The newest bill sunsets in 2025.
Hogan said Medicaid expansion has helped lower Montana’s uninsured rate down to 7% from 20% in 2013. Also, Montana’s uncompensated care costs have been reduced by nearly 50%. The program has created more than 5,000 jobs in health care and other diverse industries, by generating nearly $300 million in personal income each year, by infusing $500 million in new dollars into the state’s economy, and by helping more non-disabled adults join the workforce.
She said studies have touted that Medicaid expansion “pumped” more than $600 million each year into Montana’s economy, creating about $350 million per year in personal income. Studies also claim it has provided $902 million in health care services and saved about $40 million in Medicaid benefits.
In a 2017 teletownhall with residents, Daines said Medicaid expansion in Montana was growing beyond expectations and that expenses were more than expected and troubling.
“We’re blowing the budget, we’re busting the budget with anticipated expenses,” he said.
Hogan said the program provides health care coverage to about 230,000 children, adults and seniors, and brings in over $1 billion in investments into the state’s economy.
In FY17, Montana cost avoided $195.9 million in Medicaid payments and recovered $9.4 million. In FY18, Montana cost avoided $206.1 million in Medicaid payments and recovered $8.8 million.
Hogan said DPHHS uses a number of electronic systems to assist in validating applicants’ identities, income, and other eligibility criteria.
This story has been updated to include detailed comment from the Department of Public Health and Human Services.