As many as 3 million New Yorkers may be receiving fraudulent benefits from taxpayer-funded Medicaid and other public health insurance benefits, with costs potentially reaching $20 billion annually. A surprising new research result has been announced.
Approximately 5.5 million Empire State residents have incomes low enough to meet the standard eligibility limits for Medicaid or a related public health insurance program, the Essential Plan. But with expanded eligibility rules under Obamacare and increased demand for the controversial home health program, enrollment has swelled to 8.5 million, with a potential surplus of 3 million. There is.
“It raises the question of whether fraud is widespread,” said Bill Hammond, a senior fellow for health policy at the Empire Center, which drafted the bill. The report was released on Tuesday.
About 44% of the state's residents (including 60% of New York City residents) are covered by Medicaid or essential plans, 7 percentage points higher than any other state, according to the report. This program accounts for a large portion of the national budget.
“Overuse of taxpayer-funded insurance negatively impacts the nation in a number of ways, the most obvious being increased costs to taxpayers. Most of the 3 million excess enrollees are non-disabled adults and “Even assuming children, this could cost Medicaid more than $20 billion annually,” the study said.
It added that a third of people receiving taxpayer-funded coverage earn more than the standard income limit.
Some high-income earners can circumvent Medicaid eligibility restrictions through legal means, such as putting their income into a trust fund managed by the Medicaid applicant's agent, the report said.
The report also blamed state officials for the surge in enrollment, saying the creation of the Essential Plan expanded coverage to 250 percent of the federal poverty level.
Federal eligibility requirements and reviews were also relaxed during and after the COVID-19 pandemic, which left many people unemployed.
Additionally, the surging popularity of the Consumer Personal Assistance Program, the $6 billion state Medicaid program that allows residents with no medical experience to earn compensation to care for elderly or disabled relatives and friends. This is a contributing factor to the expansion of Medicaid. Critics say CDPAP is rife with fraud and waste and has little oversight.
States contribute $38 billion to Medicaid, but costs have soared by $10 billion, or 36 percent, in the past three years alone, according to the report. This number exceeds the state's funding for public schools, which previously made up the largest portion of the state budget. The share of state taxpayer-funded Medicaid costs has jumped 53% over the past five years and now consumes about 28% of all state operating funds.
“New York State must stop abusing Medicaid as a blanket health insurance program that covers nearly half of the state's population,” Hammond said.
“Instead, we need to refocus programs on their original and most important purpose: providing care to people who cannot help themselves.”
The report said the large number of people covered by public health insurance, including those with moderate incomes, is having a negative impact on the private insurance market.
Medicaid enrollment soared after former President Barack Obama approved the Affordable Care Act to reduce the number of uninsured or underinsured Americans. This law encouraged more people to enroll in Medicaid and the private market, or exchange.
The number of uninsured residents has plummeted. But the number of New Yorkers enrolled in Medicaid and essential plans has ballooned far more than the decline in uninsured residents, the report says.
Hammond said it's not uncommon for people to receive Medicaid but also have private health insurance.
Asked to comment on the report's findings, Gov. Cathy Hochul's office said, “We have prioritized fiscal responsibility while providing the services New Yorkers need.”
“The Governor has fought to maintain a strong reserve fund of $20.5 billion for a ‘rainy day.’ We remain committed to ensuring taxpayer money is spent responsibly. We are giving our all,” the statement said.
