Mike Stenhouse: Medicaid cuts that left, right can support

As published in the Providence Journal:


Gov. Gina Raimondo’s “Reinventing Medicaid” is not a new concept. In 2008, Rhode Island became the nation’s first state to receive a Medicaid global waiver, and since then many other states have explored ways to control burgeoning costs.

However, in 2012, after a bruising debate about President’s Obama Affordable Care Act and associated state exchanges, the Chafee administration took the further step of accepting the federal government’s program to expand Medicaid. As our Center warned, Medicaid costs in our state have exploded. Governor Raimondo is correct in asserting that Medicaid’s rate of growth is unsustainable from a budget perspective.

The question now is: Can cuts be implemented without endangering the safety net for those who are most in need of Medicaid services? One approach that everyone should agree with is to eliminate fraud and abuse and to ensure that taxpayer-funded benefits are provided only to those who are eligible. This has always been a nice-sounding goal, but difficult to achieve in practice.

But there is at least one proven solution, which our center discovered when we reached out to a national partner, the Foundation for Government Accountability (FGA), which focuses on health-care issues. FGA is successfully promoting a program that has saved hundreds of millions of Medicaid dollars in states such as Illinois and Pennsylvania.

The idea revolves around Medicaid eligibility. Without proper database mining and detailed eligibility verification for prospective and current enrollees, an FGA report shows that many states regularly extend benefits to individuals who are not eligible to receive them. Examples include payments to dead people, to wealthy lottery winners, cases with incomplete documentation, and individuals lying about their incomes.

Yet, given our Center’s strong opposition over the years to HealthSource RI and to Medicaid expansion, we wondered if we were the proper messenger to introduce this idea to state officials. We were pleased when both Elizabeth Roberts, the secretary of the Executive Office of Health and Human Services, House Speaker Nicholas Mattiello’s policy director separately agreed to meet with me and an FGA executive in March. Acknowledging our philosophical and past differences, the secretary and her staff were very gracious and highly interested in the FGA solution, as was the speaker’s policy team.

The FGA approach includes three steps: better verification at the front door; ongoing verification checks; and public prosecution and oversight. There are certain third-party vendors FGA identifies that can conduct national database checks, above and beyond the technical capacity of many states. With $90 million targeted by the governor in Medicaid cuts, this solution alone, FGA estimates, could save tens of millions in Rhode Island, allowing other critical services to be maintained.

We have been informed that this idea will be one of the recommendations included in Governor Raimondo’s work-group report. It could manifest as a request for proposals from the executive branch or via legislation that requires aggressive Medicaid eligibility verification.

Will Rhode Island try to implement this win-win cost cutting solution? If it does, it will be a reform both the left and the right should readily agree to support.


Mike Stenhouse is CEO of the Rhode Island Center for Freedom and Prosperity.


Read it on PROJO.com Here. 

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