Bloomberg News

Mismatched Data Hamper U.S. Accounting of Medicaid Costs

November 29, 2012

The full extent of U.S. spending on Medicaid, the $459 billion state-federal health insurance program for the poor, is unclear because of mismatches between government databases, auditors reported.

A $43 billion gap showed up in a comparison of 2009 spending data from the states, which run Medicaid, and the U.S. Centers for Medicare and Medicaid Services, which pays for more than half the program, according to a report released today by the Government Accountability Office. In a separate report, the inspector general for the U.S. Health and Human Services department said the agency hadn’t audited about $4 billion in payments to doctors and hospitals for installations of electronic record systems.

Medicaid is central to President Barack Obama’s health-care law, which will expand the program beginning in 2014 to cover all Americans earning wages close to the poverty line. Obama has also prioritized electronic health records, allocating about $27 billion in his 2009 economic stimulus law for medical providers who install them.

Delays in reporting the data and inconsistencies between the two databases “limit their usefulness as oversight tools,” auditors said in the report. States are supposed to report one set of Medicaid spending to the federal government within 45 days of the expenditures. The statistics can be as many as three years late, GAO said.

Hospitals are under increasing scrutiny for their use of computer systems to increase their billings to Medicare, the $591 billion U.S. health program for the elderly and disabled. Doctors and hospitals are supposed to prove they are “meaningful” users of the records to receive government payments for installing the systems.

Oversight Obstacles

The Medicare agency “faces obstacles to overseeing the Medicare EHR incentive program that leave the program vulnerable to paying incentives to professionals and hospitals that do not fully meet the meaningful use requirements,” the inspector general, Daniel Levinson, said in his report.

The acting administrator of the Medicare agency, Marilyn Tavenner, said in a letter attached to the inspector general’s report that she “does not believe prepayment audit is necessary” for the medical-records incentives. Auditing the payments before they’re made could “significantly delay” reimbursement to hospitals and doctors, she said.

To contact the reporter on this story: Alex Wayne in Washington at

To contact the editor responsible for this story: Reg Gale at

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