Audit finds Illinois spent $4.6M on Medicaid coverage for dead people

A federal health department audit found Illinois spent $4.6 million in Medicaid payments on behalf of deceased beneficiaries.

An audit by the U.S. Department of Health & Human Services’ Office of Inspector General, or OIG, found Illinois spent $4.6 million on Medicaid coverage for dead people.

From October 2015 to September 2017, Illinois made 84 insurance payments for 80 deceased individuals that the state did not recover, according to OIG’s audit. The state now owes the federal government $3.2 million – the portion of the $4.6 million Illinois received from the federal health department.

State officials blamed the errors on a “technical flaw,” according to the Chicago Tribune, and said the state failed to enter the individuals’ death dates into the system.

OIG’s Illinois audit comes following similar reports revealing that other states’ Medicaid programs also made insurance payments on behalf of dead people. The OIG report recommends Illinois add dates of death to the records of deceased beneficiaries previously marked in the system as “inactive.” The state accepted all OIG’s recommendations, according to the report.

This is not the first time Illinois accidentally made Medicaid payments on behalf of dead people: Illinois spent $16 million on Medicaid coverage for 3,961 dead people between 2013 and 2014, according to previous audits.

In 2015, former Gov. Bruce Rauner signed a bill into law requiring the Illinois Department of Human Services to cross check recipient names with death records kept by the Illinois Department of Public Health.

Illinois also spent $2.2 million on pension benefits for 1,000 dead people from 2010 to 2014.

At the same time the state was making Medicaid payments for dead people, many other Illinoisans have died waiting in line for care. Since the state expanded Medicaid through the Affordable Care Act in 2013 – which relaxed means testing requirements for able-bodied adults aged 19 to 64 – 823 Illinoisans have died while on Medicaid’s waiting list.

Despite lawmakers’ efforts to improve the system and years of reports detailing millions of mismanaged tax dollars, Illinois has struggled to resolve these inefficiencies. As the state grapples with a $3.2 billion structural deficit, it has continued to squander millions in scarce health care dollars.

State lawmakers must work to ensure Medicaid funds are spent appropriately and benefit those truly in need. Given Illinois’ dire fiscal condition, neither taxpayers nor those who rely on Medicaid can afford more bureaucratic errors.