Pharmacy News Article

Medicaid already is a keystone of the nation's health care, but it will expand under the new federal health care law. The need to ensure that the federal/state program properly uses its money will grow along with the expanded coverage.

A study by the nonpartisan Government Accountability Office demonstrates that Congress has some work to do in that regard.

The study of Medicaid payments to health care providers covered just three large states - Texas, Florida and New York. It found that in 2009 about 7,000 Medicaid providers - nearly 6 percent of all providers in those states - were paid $6.6 billion by Medicaid even though they owed a collective $791 million in a variety of federal taxes.

Some examples cited by the GAO included a dentist who collected more than $100,000 while owing substantial income taxes and spending lavishly on travel, dining and wine, and a medical transport company that collected $1 million from Medicaid even while failing to turn over millions of dollars in federal payroll taxes it had withheld from employees - a federal crime.

The federal government pays about 60 percent of Medicaid, with state governments providing the rest. Washington will cover 100 percent of the cost of new enrollees under the health care law for several years, and will continue to pay 90 percent after states begin contributing.

Under Medicare, another federal health care insurance program that serves the elderly, the federal government can go after providers who do not pay their federal taxes. It cannot do so under the Medicaid program, however, because Medicaid money is funneled through state offices rather than paid directly to providers.

Congress should refine the law to bar providers who owe taxes from participating in the program. It also should allow Medicaid to use the same device as Medicare, known as a continuous levy, to withhold owed taxes from state payments to tax-delinquent providers. It should do so before the program's scheduled expansion in 2014.