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Reeder: Better late than never in examining Medicaid program

SPRINGFIELD – Imagine walking into a government office, asking for $5,000 and being handed a check – without anyone bothering to verify whether you qualify for the money.

That’s how the state has been managing its Medicaid program for years.

While nobody actually gets handed a check, they receive a benefit with a value of about $5,000 – and a real cost to taxpayers.

Folks who apply for the health insurance program, which is reserved for low-income folks, are granted the coverage, but not enough has been done to ensure recipients are answering questions truthfully to determine whether they really qualify.

For some, basic questions are never verified, including: How much do applicants really earn? Do they really live in Illinois? Are they U.S. citizens?

Ever since the Medicaid program began expanding under former Gov. Rod Blagojevich, Republican lawmakers, in particular, have been waving the red flag and crying, “Are all of these folks really eligible?”

Blagojevich was dismissive of the concern.

Our current governor, Pat Quinn, has given the matter lip service, and it has taken him four long years to do anything.

What he has done so far is inadequate. Just ask Illinois Auditor General Bill Holland, who uncovered major problems with the program.

“When the first batch of enrollees were reviewed, they found about 60 percent weren’t eligible for the program,” said state Rep. Patti Bellock, R-Hinsdale. “That says to me there is a major problem with the administration of this program.

“The bipartisan committee I was on predicted that if the administration did a full scrubbing of the Medicaid rolls, they would find 300,000 people enrolled who weren’t eligible. Taking these people off of the Medicaid rolls would save $350 million.”

Jonathan Ingram, a senior fellow at the Illinois Policy Institute, said there are many things that make the Illinois Medicaid system attractive to out-of-staters.

“Eligibility here in Illinois is broader than in most of our neighboring states,” Ingram said. “So it makes it attractive for people to enroll here who actually live elsewhere.”

Also, Ingram said, little is done to weed out citizens from other countries unlawfully residing in the U.S. from being a part of the Medicaid system – for which they are not eligible.

But now the Quinn administration wants to do something about all of the people illegally gaming the system. It has signed a contract with a firm that will carefully examine each person’s eligibility to receive Medicaid.

“I honestly think the reason the Quinn administration is finally doing something is because the bond houses are putting a great deal of pressure on him to reform pensions and the Medicaid system,” Bellock said.

Regardless of why the Quinn administration is taking action – or at least trying to – it is clear its efforts have hit a snag that could cost taxpayers hundreds of millions of dollars.

And that snag has a name: the American Federation of State, County and Municipal Employees.

The government workers union doesn’t like Quinn having an outside firm scrubbing Medicaid rolls. It thinks that work ought to be done by state workers, who would just happen to belong to – you guessed it – AFSCME.

Never mind that the state does not have the workforce or the technology to get the job done. AFSCME smells potential new membership dues pouring into its coffers – if the state is forced to hire more workers.

The administration has signed a two-year contract with Maximus Health Services, an outfit specializing in this type of work. But now that $76 million contract is in danger because an arbitrator recently ruled that the state couldn’t hire the Virginia-based firm.

The arbitrator said the administration should use state union workers instead.

“That doesn’t make any sense,” Bellock said. “These are the same people who enrolled these ineligible people in the first place.”

Hopefully Quinn has the good sense to appeal the arbitrator’s ruling. Or, better yet, the General Assembly ought to pass a law making it clear that such contracts with outside firms are legal.

After all, our cash-strapped state doesn’t have a dime to waste.

• Scott Reeder is a veteran statehouse reporter and the journalist in residence at the Illinois Policy Institute. He can be reached at

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