$12.3 MILLION IN ILLINOIS MEDICAID PAYMENTS FOR DEAD PEOPLE, AUDIT FINDS

MATT DIETRICH
MAY 30, 2014
Reboot Illinois
The Illinois Department of Healthcare and Family Services paid $12.3 million in Illinois Medicaid payments for 2,850 enrollees who were dead, a state audit reveals.

Auditor General William Holland’s report, released Thursday, says the department had 8,232 deceased people still listed as Medicaid eligible on its books. The payments went to 2,850 people from that list. The vast majority of the $12.3 million in payments for enrollees who had been dead more than 60 days when payments were issued.

“…$11.4 million was paid on behalf of 993 individuals whose date of death was more than 60 days prior to the payment date. In our review of the eligibility for the 993 individuals, we determined that 94 percent were aged, blind, or disabled,” the report states. (The full report is posted below along with a summary.)

The $11.4 million was in “capitation” payments — fixed-rate sums paid to providers on a per-patient basis. The report says the auditor general’s office turned over its findings to DHFS for possible referral to the Inspector General’s Office, which could pursue investigations related to the payments.

Highlights from the report:

We identified four individuals who had a large amount of fee-for-service expenditures after their date of death. The following summarizes these four instances:

An individual died on January 21, 1989; however, $29,860 in payments were made for 816 
services (dental, lab, hospital, etc) beginning December 5, 2005 and continued through 
October 2013, which was the last month of data used in this testing; 

An individual died on November 1, 2010; however, $8,604 in payments for homemaker 
services and emergency response fees were made through January 2013. Additionally, the 
individual was enrolled in managed care in September 2011, which continued through 
October 2013, the last month of data used in this testing; 

An individual died on March 19, 2008; however, $14,109 in payments, for medical supplies, 
were made through March 2013. Subsequently, the individual was enrolled in managed care, 
which continued through October 2013, the last month of data used in this testing; 

An individual died on May 27, 2006; however, $22,233 in payments, primarily for 
pharmacy, general clinic, outpatient, physician, and dental services, were made through May 
7, 2013. Subsequently, the individual was enrolled in managed care, which continued 
through October 2013, the last month of data used in this testing. 
We provided recipient names, provider names, and additional supporting documentation for these four 
examples to the Department for its review and possible referral to the Inspector General’s Office.

Holland also notes that payments to deceased enrollees began a sharp increase in July 2011:

The payments for capitation arrangements occurring more than 60 days after death began to increase on 
July 1, 2011, and have continued to steadily increase through the last data we received in connection with 
this testing, which was October 2013 (see Exhibit below). As of October 1, 2013, the Department 
continued to make capitation payments for 861 of the 993 individuals (87%) identified.

Illinois Auditor General William Holland found payment to 2,850 deceased Illinois Medicaid enrollees in his March 29, 2014, audit. (Click to enlarge)

Allegations of rampant Medicaid fraud in Illinois has been a frequent theme of Republican members of the Illinois General Assembly. They believe that the $2.7 billion in savings from a massive Medicaid overhaul in 2012 largely has been negated by the state’s failure to properly clear its Medicaid rolls of ineligible patients.

Holland’s findings are sure to stoke that debate.

Here is a summary of the audit:

Summary report: STATE OF ILLINOIS DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES COMPLIANCE EXAMINATION

Here is Holland’s full report:

STATE OF ILLINOIS DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES COMPLIANCE EXAMINATION (Full report)

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