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Medicaid expansion

FGA Research Shows Skyrocketing Improper Medicaid Spending Driven by Bad Policy

Naples, FL–This week, the Foundation for Government Accountability (FGA) released data showing how Medicaid program mismanagement, federal restrictions, and Medicaid expansion have led to significant increases in improper payment rates.

With a record-high 89 million people dependent on Medicaid, state budgets have been consumed by rapidly growing Medicaid program costs. Public record requests conducted by FGA uncovered state-specific data that showed increased improper payment rates could be responsible for this program increase. Researchers also found that more than one in every five dollars spent on state Medicaid programs can be defined as improper and are primarily a result of eligibility errors.

Currently, the national improper payment rate for Medicaid is nearly 22 percent. However, FGA data showed the improper payment crisis is even worse in some states, including Ohio, with an improper payment rate of 44 percent, and Illinois, with an improper payment rate of 37 percent. Prior to Missouri’s recent expansion of Medicaid, the state suffered from an improper payment rate of more than 30 percent. This is expected to worsen as expansion continues in the state.

“Federal Medicaid spending has increased 80 percent since 2013 with improper payments making up more than 40 percent of that growth. As Congress continues to push policies that threaten states’ Medicaid programs, state policymakers must work to reduce improper payment rates and improve program integrity,” said Hayden Dublois, Deputy Research Director. “States don’t need to wait for the Biden administration. Instead, they should reject temporary federal funding that requires them to lock in ineligible enrollees for coverage, and implement commonsense Medicaid program integrity measures, such as regular data cross-checks.”

Improper payments threaten state budgets as Congress pushes Medicaid expansion federally. State policymakers must take a stand to ensure that Medicaid is preserved for the truly needy—not for waste, fraud, abuse, and mismanagement.


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