Medicaid and cost containment

This GAO report makes for a perplexing stumbling block to cost savings.

Many of these individuals accumulated substantial assets, including million-dollar houses and luxury vehicles, while failing to pay their federal taxes. In addition, some case studies involved businesses that were sanctioned for substandard care of their patients. Despite their abusive and related criminal activity, these 25 providers received Medicaid payments ranging from about $100,000 to about $39 million in fiscal year 2006….CMS and our selected states do not prevent health care providers who have federal tax debts from enrolling in Medicaid. CMS officials stated that such a requirement for screening potential providers for unpaid taxes could adversely impact states’ ability to provide health care to low income people. Further, federal law generally prohibits the disclosure of taxpayer data to CMS and states.No tax debt owed by Medicaid providers has ever been collected from Medicaid payments through the continuous levy program. IRS has determined that Medicaid payments are not considered ‘‘federal payments’’ and thus not eligible for this program. GAO estimates that for the seven selected states the federal government could have collected between $70 million to $160 million during fiscal year 2006 if an effective levy program was in place.

(bolding is mine)

So the system loses millions in order to keep services inplace? Over time, doesn’t that sound odd?

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