Medicaid: States Use Illusory Approaches to Shift Program Costs to Federal Government
HEHS-94-133
Published: Aug 01, 1994. Publicly Released: Sep 20, 1994.
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Highlights
Pursuant to a congressional request, GAO reviewed certain states' Medicaid program records, focusing on: (1) whether states are using financial arrangements that inflate the federal share of Medicaid program expenditures; (2) various techniques that states use to obtain federal funds for their basic Medicaid and disproportionate share hospital (DSH) programs; and (3) whether states are using their federal matching funds to provide medical services to Medicaid patients.
Recommendations
Matter for Congressional Consideration
| Matter | Status | Comments |
|---|---|---|
| Congress should enact legislation to minimize the likelihood that states can develop illusory financing mechanisms whereby providers return Medicaid payments to the states, thus effectively reducing the states' share of Medicaid funding. This legislation should prohibit Medicaid payments that exceed costs to any government-owned facility. | Congress is considering major changes to the Medicaid program that would increase states' flexibility in managing their Medicaid programs. The reforms being considered do not directly address this issue. |
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Topics
Cost sharing (finance)Federal aid to statesstate relationsFunds managementHealth care servicesHospitalsProgram abusesQuestionable paymentsState-administered programsMedicaid