OSHKOSH – On Wednesday, U.S. Sen. Ron Johnson (R-Wis.) and House Committee on Oversight and Reform Ranking Member Rep. James Comer (R-Ky.) along with 20 of their colleagues, sent a letter to the Centers for Medicare and Medicaid Services (CMS) Administrator Chiquita Brooks-LaSure seeking information on what safeguards CMS has in place to address improper payments in the Medicaid program.

The members wrote, “According to CMS, Medicaid made $57.36 billion in improper payments in fiscal year 2019. Medicaid’s improper payments accounted for 32.8 percent of all improper payments across the federal government. In FY 2020, improper payments rose to $86.9 billion, meaning more than one out of every five Medicaid payments were improper. A recent report by the Foundation for Government Accountability found almost all of the improper payments were due to eligibility errors, administrative oversights, or outright fraud. Further, the report found the rate of Medicaid improper payments has nearly quadrupled since the implementation of Obamacare in 2014.”    

The members went on to say, “These staggering rates of improper payments in Medicaid programs are inexcusable.  As CMS data underscores, these improper payments threaten the integrity of the Medicaid program.  Moreover, we are concerned the policies implemented in response to the COVID-19 pandemic—expanded Medicaid eligibility, increased federal funding and suspended state audits—possibly added to the significant levels of improper payments in the program.”

Brian Blasé of Paragon Health Institute said, “Across multiple administrations of both parties, CMS has failed to protect the Medicaid program and ensure that taxpayer dollars only benefit eligible enrollees. The Affordable Care Act's expansion of the program has driven improper federal Medicaid payments to an estimated $100 billion annually. Senator Johnson and Representative Comer are taking important actions to shed light on this massive government failure and to hopefully push CMS to adopt common sense program integrity efforts.”  

Garrett Bess, Vice President of Heritage Action said, “According to their own data, the Centers for Medicare and Medicaid Services (CMS) is wasting a staggering amount of taxpayer money each and every year by making improper payments.  This cavalier attitude towards public finances is why America faces a historic fiscal crisis.  It is great to see Senator Johnson and Ranking Member Comer holding the administration’s feet to the fire on behalf of the American taxpayer.  We look forward to a response from CMS that includes a serious plan on how they plan to prevent improper payments moving forward.”

The Foundation for Government Accountability said, “Over time, Medicaid has transformed from a program for the truly needy into a massive welfare program for millions of able-bodied adults. As Medicaid has grown, so has its mismanagement. More than one in five dollars spent on Medicaid is improper, with the error rate in some states reaching as high as nearly 50 percent. Virtually all of these improper payments are due to eligibility errors, administrative oversights, or outright fraud. These eligibility errors were exacerbated by Medicaid policies in the Families First Coronavirus Relief Act (FFCRA) which have kept 17 million ineligible enrollees on the program. The Foundation for Government Accountability (FGA) applauds Senator Ron Johnson and Rep. James Comer's efforts to increase transparency and integrity in the Medicaid program.”

Sen. Johnson and Rep. Comer are joined on the letter by Senators James Inhofe (R-Okla.), James Lankford (R-Okla.), Rand Paul (R-Ky.), Rick Scott (R-Fla.), Marsha Blackburn (R-Tenn.), Ted Cruz (R-Texas), Mike Lee (R-Utah), Mike Braun (R-Ind.) and Representatives Ralph Norman (R-S.C.), Jody Hice (R-Ga.), Glenn Grothman (R-Wis.), Andy Biggs (R-Ariz.), Nancy Mace (R-N.C.), Byron Donalds (R-Fla.), Fred Keller (R-Ariz.), Jake LaTurner (R-Kan.), Virginia Foxx (R-N.C.), Scott Franklin (R- Fla.), Yvette Herrell (R-N.M.), and Chip Roy (R-Texas).

Read more about the letter in The Daily Caller.

The full text of the letter can be found here and below.

April 13, 2022 

Dear Administrator Brooks-LaSure:

              For years, we have raised concerns to the Centers for Medicare and Medicaid Services (CMS) regarding the staggering rate of improper payments in the Medicaid program.^[1]  Despite our calls to action, the improper payment rate continues to increase.^[2]  As we previously noted, the improper payments rate is likely an underestimate, and some estimates show that 27 percent, or more than $100 billion annually, could be improper.^[3]  This alarming amount threatens the viability of a program designed for Americans in need.  We write seeking additional information on what safeguards CMS has in place to address improper payments in the Medicaid program.

              According to CMS, Medicaid made $57.36 billion in improper payments in fiscal year 2019.[4]   Medicaid’s improper payments accounted for 32.8 percent of all improper payments across the federal government.[5]  In FY 2020, improper payments rose to $86.9 billion, meaning more than one out of every five Medicaid payments were improper.[6]  A recent report by the Foundation for Government Accountability found almost all of the improper payments were due to eligibility errors, administrative oversights, or outright fraud.^[7]  Further, the report found the rate of Medicaid improper payments has nearly quadrupled since the implementation of Obamacare in 2014.[8] 

              The improper payment rate in some states is as high as 44 percent—nearly double the national average.^[9]  Eligibility errors cause almost all—95 percent—of the improper payment rates in the worst performing states and cause 80 percent of improper payments nationwide.^[10]  Improper payments doubled over the last decade in some states like Illinois.^[11]   Meanwhile, according to the data CMS provided, California’s error rate was only 6.3 percent—significantly less than the nationwide average—despite rapid growth in the state’s Medicaid program. [12]  This low percentage appears implausible considering a 2018 Health and Human Services Inspector General audit which found more than half of sampled enrollees in California’s Medicaid program were paid to ineligible beneficiaries.[13]

These staggering rates of improper payments in Medicaid programs are inexcusable.  As CMS data underscores, these improper payments threaten the integrity of the Medicaid program.  Moreover, we are concerned the policies implemented in response to the COVID-19 pandemic—expanded Medicaid eligibility, increased federal funding and suspended state audits—possibly added to the significant levels of improper payments in the program.^[14]

              To better understand the policies that CMS instituted to increase accountability and reduce improper payments in the Medicaid program, please provide the following information:

1.       The underlying data and methodology used to determine improper payment rates for all 50 states and the District of Columbia, including the eligibility component of the rate, for each year.  

2.       The processes and procedures CMS uses to validate each state’s improper payment rate.  This includes sample data sets used by states or CMS to review eligibility determinations.

3.       A list of CMS’s efforts to recover the hundreds of billions of dollars in improper Medicaid payments. 

4.       The estimated improper payment rate due to the Medicaid expansion in response to COVID-19 and the number of Americans newly enrolled in the Medicaid program in response to COVID-19.

5.       The actions taken by CMS to date to ensure the program only enrolls those who meet eligibility requirements. Please provide this information on a state-by-state basis.

The Committee on Oversight and Reform is the principal oversight committee of the U.S. House of Representatives and has broad authority to investigate “any matter” at “any time” under House Rule X.  

Please provide this material as soon as possible but no later than 5:00 p.m. on April 27, 2022.  Thank you for your attention to this important inquiry. 

Sincerely,

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