Better Financial Practices Needed to Manage $7.5 billion program
FOR IMMEDIATE RELEASE: December 21, 2011
An audit has found a lack of accountability and transparency in the state Medicaid program according to Senator Kathleen Vinehout.
“The Department of Health Services (DHS) is unable to assign many Medicaid costs by specific program, such as BadgerCare,” said Vinehout. “If DHS can’t answer such basic questions about program costs, how can officials make informed decisions on how to fix Medicaid?”
The nonpartisan Legislative Audit Bureau released the much anticipated audit of the state’s Medical Assistance (MA) program. The audit findings shined a light on the lack of transparency regarding dollars spent on specific MA programs.
“The inability of the department to account for how and where each dollar is spent raises serious questions about how they can effectively manage costs and quality.” Vinehout said.
State accounting systems are unable to identify on which Medical Assistance programs $2 billion of the $7 billion was spent during fiscal year 2009-10. Vinehout noted these problems take on added significance when state officials propose ‘savings’ by making major changes to MA programs.
“Officials say taxpayers will save money by dumping people off BadgerCare,” said Vinehout. “I have questions about the money spent on contractors hired to find those savings. Is the money we are spending to bring about savings paying off or not?”
Vinehout cited $12.2 million paid to contractors to achieve ‘savings’. Auditors identified 11 contract amendments, which included the hiring of an additional 107 vendor staff, but were unable to determine the extent to which this investment actually saved taxpayer dollars.
The audit also identified significant concerns related to the administration of contracts by DHS.
“DHS amended contracts numerous times. The amendments increased costs. Those costs were not budgeted for by DHS.” Vinehout said. “DHS officials did not even communicate the contract changes to budget, accounting and procurement staff.”
“There must be transparency in how state tax dollars are spent. DHS should get its own fiscal house in order before kicking thousands of citizens off health programs,” concluded Vinehout.
As former Co-Chair of the Joint Legislative Audit Committee, Vinehout recommended an audit of the Medicaid program two years ago. The audit was approved by the Committee in January 2011.
Contact: Sen. Vinehout 608-266-8546