Up to $1 Billion in Medicaid Outlays Improper, GAO Says

Medicaid is paying from $500 million to more than $1 billion a year for medical bills that should be paid by private insurers, the General Accounting Office said today.

In 1984, the report said, the federal government spent $21 billion and the states $17 billion to finance health care for 22 million low-income people.

By law, it noted, all other available resources, such as private insurance, must be exhausted before Medicaid pays claims.

The Census Bureau “reported that in 1981, the most recent available data, about 18% of Medicaid recipients were covered by private health insurance,” the GAO said. “Also, in the case of accidents, liability insurers may be responsible for injured Medicaid recipients’ medical bills.”

States must make reasonable efforts to identify and collect from health and liability insurers before making Medicaid responsible for paying medical bills, the report said.