State misallocated medicaid coverage fees to deceased, cost 1.9 million dollars

Photo provided by staff

POSTED: Monday, November 4, 2013 - 7:05pm

UPDATED: Tuesday, November 5, 2013 - 9:03am

In the last eighteen months, the Department of Health and Hospitals paid over 1.9 million dollars in Medicaid coverage for people who no longer needed coverage, because they had passed away.

"It's a needle in a haystack," said Legislative Auditor, Daryl Purpera.

It’s a needle in the size of 1.9 million dollars. Even though DHH was paying on behalf of the 1,700 dead people, those funds did not go to them directly. It went to the health management programs that the state recently started to use.

Louisiana is now using Bayou Health and Behavioral Health Partnership, in which the state pays them monthly fees for anyone eligible for insurance coverage.

“It’s a new program with new processes and new procedures,” noted Purpera.

“It doesn’t mean it’s a bad thing that we are moving to a mange care system,” said DHH Secretary, Kathy Kleibert. “It allows us to do things differently.”

Secretary Kleibert says one of the major reasons for this mistake was “a faulty federal database" or the social security system.

“The majority of these cases were not closed out by social security."

Legislative Auditor Purpera says these programs affect a lot of our citizens and its important the right amount of money is paid but not to the deceased.

"What we wanted to point out at the auditors office was that there is a better way to do it, that we should put some checks and balances in the process."

Kleibert assured me that they are already working to make sure this doesn't happen again.

"We’re doing a couple of things to correct this were not going to use the faulty database anymore, were going to use our vital records system to determine whether or not someone is dead."

So now the 1700 "eligible participants" will be removed from the list and all of the misallocated funds will be recouped, soon.

Kleibert told NBC33 they will recoup 1,300 of the 1,700 individual's funds this month then the remainder will be done in February. To do that they simply are reducing the fees paid monthly to those health management programs.

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