06 Mar MEDICAID NEWS RECAP – FEBRUARY 2025
Syrtis Solutions distributes a monthly Medicaid news summary to help you stay up-to-date. The monthly roundup focuses on developments, research, and legislation that relates to Medicaid program integrity, cost avoidance, coordination of benefits, improper payments, fraud, waste, and abuse. Below is a summary of last month’s Medicaid news.
POTENTIAL FEDERAL BUDGET CUTS AND THEIR IMPACT ON MEDICAID: HOW STATES SHOULD PREPARE Syrtis Solutions, February 28
With the passing of the recent budget proposal in Congress, Medicaid remains a prime target for potential budget cuts. If funding reductions move forward, states will be left scrambling to fill gaps, likely leading to fewer benefits, stricter eligibility requirements, and financial strain on healthcare providers. Given that Medicaid supports millions of low-income individuals, families, and people with disabilities, any significant changes could have severe consequences for access to care and the broader healthcare system. With the possibility of substantial budget cuts, states must prepare by evaluating their current spending, exploring alternative funding mechanisms, and advocating for policy changes that protect vulnerable populations.
With the passing of the recent budget proposal in Congress, Medicaid remains a prime target for potential budget cuts. If funding reductions move forward, states will be left scrambling to fill gaps, likely leading to fewer benefits, stricter eligibility requirements, and financial strain on healthcare providers. Given that Medicaid supports millions of low-income individuals, families, and people with disabilities, any significant changes could have severe consequences for access to care and the broader healthcare system. With the possibility of substantial budget cuts, states must prepare by evaluating their current spending, exploring alternative funding mechanisms, and advocating for policy changes that protect vulnerable populations.
Audits show room for improvement in health care program and Medicaid fraud prevention VermontBiz, February 27
Vermont’s Medicaid program cost more than $2 billion last year, providing coverage to nearly 197,000 individuals who were served by thousands of Vermont providers, including hospitals, nursing homes, general practitioners, and specialists. Because of the scale and importance of the program, we decided to conduct two audits of the Department of Vermont Health Access (DVHA), the state department that manages Vermont’s Medicaid program. The first audit related to DVHA’s Special Investigative Unit (SIU), which is responsible for trying to prevent Medicaid fraud, waste, and abuse. read more
Vermont’s Medicaid program cost more than $2 billion last year, providing coverage to nearly 197,000 individuals who were served by thousands of Vermont providers, including hospitals, nursing homes, general practitioners, and specialists. Because of the scale and importance of the program, we decided to conduct two audits of the Department of Vermont Health Access (DVHA), the state department that manages Vermont’s Medicaid program. The first audit related to DVHA’s Special Investigative Unit (SIU), which is responsible for trying to prevent Medicaid fraud, waste, and abuse. read more
California braces for potential federal cuts to Medi-Cal program
abc10, February 26
The Republican-controlled House passed a budget blueprint Tuesday as part of an effort to avert a government shutdown. Lawmakers are looking to cut some $880 billion over the next decade, which could possibly include cuts to Medicaid. “This is costing California taxpayers $9.5 billion this year alone,” said Rep. Kevin Kiley (R-Roseville). Kiley says the cuts are needed since the state spends billions on providing Medi-Cal to people regardless of citizenship. Californians between the ages of 26-49 have been able to qualify for Medi-Cal regardless of immigration status since January 2024. read more
abc10, February 26
The Republican-controlled House passed a budget blueprint Tuesday as part of an effort to avert a government shutdown. Lawmakers are looking to cut some $880 billion over the next decade, which could possibly include cuts to Medicaid. “This is costing California taxpayers $9.5 billion this year alone,” said Rep. Kevin Kiley (R-Roseville). Kiley says the cuts are needed since the state spends billions on providing Medi-Cal to people regardless of citizenship. Californians between the ages of 26-49 have been able to qualify for Medi-Cal regardless of immigration status since January 2024. read more
WWNO, February 26
Louisiana’s reliance on federal funds for half of the state budget leaves it vulnerable as President Donald Trump and congressional leaders push for substantial cuts in federal spending. Federal funds provided $21.4 billion, or 50.8%, of the $42.1 billion Louisiana state budget in fiscal 2024. Louisiana is usually ranked within the top five states with the greatest percentage of their budgets coming from federal funding, and residents who depend on Medicaid for health insurance or on food stamps could be particularly vulnerable. read more
Louisiana’s reliance on federal funds for half of the state budget leaves it vulnerable as President Donald Trump and congressional leaders push for substantial cuts in federal spending. Federal funds provided $21.4 billion, or 50.8%, of the $42.1 billion Louisiana state budget in fiscal 2024. Louisiana is usually ranked within the top five states with the greatest percentage of their budgets coming from federal funding, and residents who depend on Medicaid for health insurance or on food stamps could be particularly vulnerable. read more
Jason Brodeur files bill to enhance Medicaid oversight
Florida Politics, February 26
Lake Mary Republican Sen. Jason Brodeur has filed a bill (SB 1060) to establish a Joint Legislative Committee on Medicaid Oversight. The committee would be within the Office of the Auditor General and would aim to ensure that Florida’s Medicaid program operates efficiently and transparently. In May 2024, former Florida Attorney General Ashley Moody announced that two arrests had been made stemming from a billing scheme that had defrauded the Florida Medicaid program out of more than $1.6 million. Not only did prosecutors accuse the duo of defrauding the state’s Medicaid program, but they were also accused of hiring unlicensed medical staff that resulted in the poor treatment of Medicaid patients. read more
Florida Politics, February 26
Lake Mary Republican Sen. Jason Brodeur has filed a bill (SB 1060) to establish a Joint Legislative Committee on Medicaid Oversight. The committee would be within the Office of the Auditor General and would aim to ensure that Florida’s Medicaid program operates efficiently and transparently. In May 2024, former Florida Attorney General Ashley Moody announced that two arrests had been made stemming from a billing scheme that had defrauded the Florida Medicaid program out of more than $1.6 million. Not only did prosecutors accuse the duo of defrauding the state’s Medicaid program, but they were also accused of hiring unlicensed medical staff that resulted in the poor treatment of Medicaid patients. read more
American Hospital Association, February 26
The House of Representatives last night voted 217-215 to adopt its budget proposal that calls for $2 trillion in spending cuts, some of which could potentially impact Medicaid and other key health care programs. The bill, which focuses on the Trump administration’s agenda on border security, defense, energy and taxes, also allows for up to $4.5 trillion in spending for tax cuts and would raise the debt ceiling by $4 trillion. In a statement shared yesterday with the media prior to the House vote, AHA President and CEO Rick Pollack said the chamber should construct a path forward on budget reconciliation that “protects Medicaid from harmful cuts that would impact access to care for millions of Americans.” read more
The House of Representatives last night voted 217-215 to adopt its budget proposal that calls for $2 trillion in spending cuts, some of which could potentially impact Medicaid and other key health care programs. The bill, which focuses on the Trump administration’s agenda on border security, defense, energy and taxes, also allows for up to $4.5 trillion in spending for tax cuts and would raise the debt ceiling by $4 trillion. In a statement shared yesterday with the media prior to the House vote, AHA President and CEO Rick Pollack said the chamber should construct a path forward on budget reconciliation that “protects Medicaid from harmful cuts that would impact access to care for millions of Americans.” read more
Office of Inspector General audit finds Colorado paid millions in Medicaid funding for deceased enrollees Denver abc 7, February 25
The Office of Inspector General alleges that the State of Colorado owes the federal government $6 million related to Medicaid funding that was reportedly spent on enrollees who were dead. An audit conducted by the OIG found 127,874 payments were made on behalf of recipients who were listed as deceased by the Social Security Administration (SSA) but not listed as deceased in the state’s system. Another 106,222 payments were reportedly made on behalf of recipients who were listed as deceased in the state’s system at the time of the audit. read more
The Office of Inspector General alleges that the State of Colorado owes the federal government $6 million related to Medicaid funding that was reportedly spent on enrollees who were dead. An audit conducted by the OIG found 127,874 payments were made on behalf of recipients who were listed as deceased by the Social Security Administration (SSA) but not listed as deceased in the state’s system. Another 106,222 payments were reportedly made on behalf of recipients who were listed as deceased in the state’s system at the time of the audit. read more
The Clock is Ticking: Protect Medicaid Budgets
Syrtis Solutions, February 24
Syrtis Solutions, February 24
With potential budget cuts on the horizon, reducing improper Medicaid payments is more important than ever. Inefficiencies in claims processing cost the program $80 billion annually, but better data can help.
- Identify third-party liability (TPL) coverage before claims are paid
- Reduce unnecessary payments with real-time eligibility data
- Move beyond the inefficient “pay and chase” model
By improving cost avoidance strategies, Medicaid agencies and MCOs can protect funding and ensure resources go where they’re needed most.
Adapting ACA Access Amid Medicaid Transition and Policy Reversals: Molly Dean AJMC, February 19
During the COVID-19 pandemic, Congress temporarily suspended eligibility checks for Medicaid and the Children’s Health Insurance Program (CHIP), ensuring uninterrupted access to health care for millions of Americans.1 As a result, Medicaid and CHIP enrollment surged from 71 million in February 2020 to 94 million by April 2023. However, with the pandemic emergency ending in May 2023, states resumed eligibility reviews, initiating a process termed “unwinding.” To mitigate disruptions in care, some states offered financial assistance to help those transitioning from Medicaid to Affordable Care Act (ACA) marketplace coverage. read more
During the COVID-19 pandemic, Congress temporarily suspended eligibility checks for Medicaid and the Children’s Health Insurance Program (CHIP), ensuring uninterrupted access to health care for millions of Americans.1 As a result, Medicaid and CHIP enrollment surged from 71 million in February 2020 to 94 million by April 2023. However, with the pandemic emergency ending in May 2023, states resumed eligibility reviews, initiating a process termed “unwinding.” To mitigate disruptions in care, some states offered financial assistance to help those transitioning from Medicaid to Affordable Care Act (ACA) marketplace coverage. read more
Kentuckians can’t afford federal cuts to Medicaid
Kentucky Lantern, February 17
This year marks the 60th anniversary of the Medicaid program. Over the last six decades, Medicaid has been one of our most successful efforts to safeguard health coverage in an ever-changing world. As a state and federal partnership, it also serves as a vital reminder of the longstanding good our government can achieve when it comes together to tackle big challenges. Medicaid allows for vital access to care for low-income families, children, pregnant women, elderly adults and individuals with disabilities. In Kentucky it’s been an indispensable pillar for our health care system — a lifeline for about a third of the state’s population.
Kentucky Lantern, February 17
This year marks the 60th anniversary of the Medicaid program. Over the last six decades, Medicaid has been one of our most successful efforts to safeguard health coverage in an ever-changing world. As a state and federal partnership, it also serves as a vital reminder of the longstanding good our government can achieve when it comes together to tackle big challenges. Medicaid allows for vital access to care for low-income families, children, pregnant women, elderly adults and individuals with disabilities. In Kentucky it’s been an indispensable pillar for our health care system — a lifeline for about a third of the state’s population.
Audit finds New York missed $31.2 million in Medicaid drug rebates due to system errors FingersLakes1.com, February 13
13 New York’s Medicaid program lost an estimated $31.2 million in drug rebates due to rejected pharmacy encounter claims, according to an audit released by the State Comptroller’s Office. The report found that errors in the Department of Health’s (DOH) encounter system led to nearly half a million claims being improperly excluded from rebate invoicing. The audit, covering January 2018 through March 2023, identified 453,706 pharmacy encounter claims totaling $59.1 million in payments that were rejected by DOH’s system. read more
13 New York’s Medicaid program lost an estimated $31.2 million in drug rebates due to rejected pharmacy encounter claims, according to an audit released by the State Comptroller’s Office. The report found that errors in the Department of Health’s (DOH) encounter system led to nearly half a million claims being improperly excluded from rebate invoicing. The audit, covering January 2018 through March 2023, identified 453,706 pharmacy encounter claims totaling $59.1 million in payments that were rejected by DOH’s system. read more
Committee On Oversight, February 12
The Subcommittee on Delivering on Government Efficiency (DOGE) held its inaugural hearing today titled “The War on Waste: Stamping Out the Scourge of Improper Payments and Fraud” to investigate the hundreds of billions of taxpayers’ dollars wasted annually on improper payments and fraud. Expert witnesses shared step-by-step plans to improve payment systems, close loopholes, decrease fraud, and save American taxpayers billions of dollars every year. Members explained how the DOGE Subcommittee will aid President Trump and Elon Musk in their efforts to rein in the runaway bureaucracy. read more
The Subcommittee on Delivering on Government Efficiency (DOGE) held its inaugural hearing today titled “The War on Waste: Stamping Out the Scourge of Improper Payments and Fraud” to investigate the hundreds of billions of taxpayers’ dollars wasted annually on improper payments and fraud. Expert witnesses shared step-by-step plans to improve payment systems, close loopholes, decrease fraud, and save American taxpayers billions of dollars every year. Members explained how the DOGE Subcommittee will aid President Trump and Elon Musk in their efforts to rein in the runaway bureaucracy. read more
Virginia Mercury, February 7
With the threat of federal budget cuts looming, Virginia lawmakers are laying the groundwork to respond to potential changes that could impact healthcare coverage for roughly 630,000 residents. As the General Assembly prepares for budget negotiations with Gov. Glenn Youngkin, proposed amendments include contingency plans to address possible federal reductions to Medicaid funding. Sen. Creigh Deeds, D-Charlottesville, emphasized the need for readiness. “There are variations of what can come from Washington,” Deeds said. “We have to be prepared to respond and that’s what the budget language allows.” read more
With the threat of federal budget cuts looming, Virginia lawmakers are laying the groundwork to respond to potential changes that could impact healthcare coverage for roughly 630,000 residents. As the General Assembly prepares for budget negotiations with Gov. Glenn Youngkin, proposed amendments include contingency plans to address possible federal reductions to Medicaid funding. Sen. Creigh Deeds, D-Charlottesville, emphasized the need for readiness. “There are variations of what can come from Washington,” Deeds said. “We have to be prepared to respond and that’s what the budget language allows.” read more
The Valley Patriot, February 7
Today, State Auditor Diana DiZoglio’s Office released an annual report of the recent work conducted by the office’s Medicaid Audit Unit, from March 2, 2024 through February 28, 2025. Over the past year, the State Auditor’s Office released three audit reports on the state’s Medicaid program, known as MassHealth, and its compliance with state and federal laws, regulations, and other applicable authoritative guidance. Combined, these three reports identified an estimated $27,259,164 in potential cost savings and provided several recommendations to strengthen internal controls and oversight in MassHealth’s program administration. read more
Today, State Auditor Diana DiZoglio’s Office released an annual report of the recent work conducted by the office’s Medicaid Audit Unit, from March 2, 2024 through February 28, 2025. Over the past year, the State Auditor’s Office released three audit reports on the state’s Medicaid program, known as MassHealth, and its compliance with state and federal laws, regulations, and other applicable authoritative guidance. Combined, these three reports identified an estimated $27,259,164 in potential cost savings and provided several recommendations to strengthen internal controls and oversight in MassHealth’s program administration. read more
Times Union, February 6
The state comptroller’s office said Thursday that an audit had uncovered $16 million in improper Medicaid payments made by the Department of Health, and found 10 Medicaid providers that had criminal violations that should have excluded them from the state’s program. The comptroller’s audit, which spanned a six-month period ending in March 2024, said that nearly $3 million has so far been recovered and nine of the providers have been removed from the Medicaid program. read more
The state comptroller’s office said Thursday that an audit had uncovered $16 million in improper Medicaid payments made by the Department of Health, and found 10 Medicaid providers that had criminal violations that should have excluded them from the state’s program. The comptroller’s audit, which spanned a six-month period ending in March 2024, said that nearly $3 million has so far been recovered and nine of the providers have been removed from the Medicaid program. read more
Reuters, February 5
Representatives of Elon Musk’s Department of Government Efficiency have been working at the Centers for Medicare and Medicaid Services where they were granted access to agency systems and technology, CMS said on Wednesday. CMS oversees Medicare, the health insurance program for older and disabled Americans, and Medicaid, for lower-income enrollees. Together they provide coverage for over 140 million people in the United States. read more
Representatives of Elon Musk’s Department of Government Efficiency have been working at the Centers for Medicare and Medicaid Services where they were granted access to agency systems and technology, CMS said on Wednesday. CMS oversees Medicare, the health insurance program for older and disabled Americans, and Medicaid, for lower-income enrollees. Together they provide coverage for over 140 million people in the United States. read more
Disputed $15.5 billion R.I. Medicaid contract canceled amid new federal requirements Rhode Island Current, February 4
Rhode Island officials have scrapped a tentative, $15.5 billion, five-year contract to manage the state Medicaid program amid new federal rules, Kerri White, a spokesperson for the Rhode Island Executive Office of Health and Human Services (EOHHS), confirmed via email on Tuesday. Instead, the state will extend its existing Medicaid contract to June 30, 2026 — a year later than it was scheduled to end. The massive contract, equal to 25% of the state’s annual budget, determines which vendors run the state’s medical assistance program for nearly 320,000 Rhode Islanders. read more
Rhode Island officials have scrapped a tentative, $15.5 billion, five-year contract to manage the state Medicaid program amid new federal rules, Kerri White, a spokesperson for the Rhode Island Executive Office of Health and Human Services (EOHHS), confirmed via email on Tuesday. Instead, the state will extend its existing Medicaid contract to June 30, 2026 — a year later than it was scheduled to end. The massive contract, equal to 25% of the state’s annual budget, determines which vendors run the state’s medical assistance program for nearly 320,000 Rhode Islanders. read more
As cuts loom, state Medicaid programs leave millions in drug rebates on the table Stateline, February 3
Even as states worry about looming Medicaid cuts, they are failing to collect tens of millions of dollars in drug discounts every year, according to a report by a government watchdog. Since 1991, state Medicaid agencies have been entitled to claim rebates from pharmaceutical companies. But between 2008 and 2020, the agencies failed to collect $392.8 million in rebates, according to a little-noticed report released last spring by the inspector general’s office of the U.S. Department of Health and Human Services. In addition, states should have claimed rebates totaling an unknown amount for another $362.3 million worth of drugs, the report found.
Even as states worry about looming Medicaid cuts, they are failing to collect tens of millions of dollars in drug discounts every year, according to a report by a government watchdog. Since 1991, state Medicaid agencies have been entitled to claim rebates from pharmaceutical companies. But between 2008 and 2020, the agencies failed to collect $392.8 million in rebates, according to a little-noticed report released last spring by the inspector general’s office of the U.S. Department of Health and Human Services. In addition, states should have claimed rebates totaling an unknown amount for another $362.3 million worth of drugs, the report found.