Federal audit shows South Carolina made $406 million in improper Medicaid payouts

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AIKEN — A federal audit released Friday said that South Carolina might have spent more than $406 million on improper Medicaid payments and that nearly 11 percent of payments were made in error.

Tony Keck, the state Department of Health and Human Services’ exec­utive director, said many of the people who received the improper benefits would have qualified for the money if procedures had been properly followed.

“I think what we’re finding out is a large number are in fact eligible but did not follow the rules,” Keck said.

But the state’s eligibility workers didn’t follow procedures to put them in the program without proper documentation.

“Many have reapplied since that time and a number of their cases were done properly and they have received services.”

The data are based on claims handled in the federal fiscal year that ended in September 2010 and rely on a review of about 500 cases, Keck said.

He said that there might be issues with how the federal audit figures were gathered but that he is more interested in fixing the issues raised than questioning the accuracy of the report.

“We’re going to focus on fixing the problems,” Keck said. “The problem is very real.”

The state’s Medicaid program has been strapped for cash for more than a year. Keck took it over last year as legislators learned it was facing a deficit of nearly $228 million and badly in need of a taxpayer bailout.

The deficits were dealt with through a combination of spending and benefit reductions that included lowering payments to doctors and hospitals.

“We’re not going to have a repeat of the fiasco from last year,” he said. The audit confirms problems and provides details that Keck said legislators will be briefed on and asked to help resolve.

The Health and Human Services Department said it will merge computer systems and management of systems, use a private grant to improve operations and update its Medicaid eligibility decision system.

“Yes, the taxpayers should be concerned that money is being wasted on this program, but we’ve got to be able to walk and chew gum at the same time,” Keck said.


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