Ohio starts audit of its Medicaid program

11/16/2005

COLUMBUS - Auditor Betty Montgomery yesterday launched an unprecedented performance audit of Ohio's $9.7 billion-a-year Medicaid program, predicting that her team will identify millions in savings.

"It's not just a flashy sound bite," she said. "It's not just an ad in the paper or on television. It's not some quick-fix plan designed to grab headlines. I'm talking about millions in real taxpayer dollars."

The candidate for governor said she believes it was a mistake for the state to merge the Department of Human Services and the Bureau of Employment Services into one massive Department of Job and Family Services five years ago.

The two-year, $51.3 billion state budget that went into effect July 1 orders the state auditor to undertake the audit to crack down on fraud and waste and to identify ways the health insurance program of last resort can improve operations.

On average, 60 cents of every dollar Ohio spends on medical services for children, the poor, and frail comes from the federal government.

"Identifying and collecting overpayments has simply not worked, and, it appears, not been a priority," she said. "The U.S. General Accounting Office estimates that between 5 and 7 percent of all health-care expenditures in this country consists of fraudulent or erroneous payments.

"Apply that figure to the Medicaid program," she said. "That would translate into hundreds of millions of dollars."

She said her audit will examine the best practices employed by other states and will examine greater use of generic drugs, more privatization of services, and long-term care options as an alternative to costly nursing homes.

She said 15 people are on the Medicaid audit team, three times the number for a normal audit.

Ms. Montgomery plans to unveil an interim report by spring. That's conveniently before the May primary election in which Ms. Montgomery is vying for the Republican gubernatorial nomination against Secretary of State Ken Blackwell and Attorney General Jim Petro.

The final report is due by the end of 2006.