Health Desk
6:49 pm
Tue September 17, 2013

Public vs. Private Job To Scrub State Medicaid Rolls

Director of Illinois' Department of Healthcare and Family Services, Julie Hamos
Credit Illinois.gov

  Illinois' attempts to remove ineligible people from the state's Medicaid rolls are on hold, as Illinois and its largest public employees' union fight over who should actually do the scrubbing. The state says it will appeal a ruling that says it has to cancel its $77 million dollar contract with an outside firm.

Big changes are ahead for Medicaid, the state's health insurance program for the poor. Hundreds of thousands of residents are expected to be added to the rolls under the federal health care law.

But first, Illinois wants to remove people who are ineligible.

The state hired a company - Maximus - to do that, and since January, about 125,000 people have been dropped.

Henry Bayer, with the AFSCME union, says state employees should have had that duty.

"The state of Illinois could have accomplished the same task for $18 million less," he says. "I know there's a lot of people who put on their ideological blinders and believe that the private sector always does things beter than the public sector. And of course we know that not to be true."

An arbitrator agreed; meaning Illinois would have to end its contract with Maximus months early.

But State Sen. Dale Righter (R-Mattoon) says a private vendor was needed because state workers weren't getting the job done.

"The reason the third party contractor was insisted upon, and approved with an overwhelming, bipartisan majority in both chambers and signed by the governor, was because looking back since 2011 the history kind of demonstrated to us that we needed something more," he says. "Cause just kinda the same old statements about 'we're going to get this thing cleaned up' and the same press releases and the same 'come on now team let's go' wasn't getting it done."

Director of the Department of Healthcare and Family Services, Julie Hamos, says the DFS workforce has dwindled to the point where there aren't enough case workers to carry out the job. She announced at a hearing in Chicago Tuesday afternoon that the state will appeal the arbitrator's decision ahead of a Wednesday deadline.

"Our shared priority is to preserve the integrity of Medicaid so that it can serve our most vulnerable while eliminating waste, fraud and abuse," she says.

Hamos says rather than abruptly cancelling the Maximus contract, it may be most efficient to gradually transition to a hybrid system, that allows the state to continue using the company's software.

Hamos says it's especially important now that Illinois get its Medicaid numbers down because the state's moving to a managed care system. Instead of reimbursing doctors when they provide services to a Medicaid patient, Illinois will pay a per-client fee, regardless of whether the Medicaid participant actually goes to the doctor or not.