Medicaid fraud reform bills pass Legislature

March 15, 2012

By Staff

An overhaul of Washington’s Medicaid fraud recovery efforts to cut waste and recover taxpayer dollars was passed by the Legislature March 8 with strong bipartisan support, according to a press release from the Legislature.

A bipartisan group of legislators applauded the progress made.

Experts from the National Conference of State Legislatures estimate the cost of Medicaid fraud accounts for between 3 percent and 10 percent of total Medicaid expenditures. Washington spent $8.5 billion on Medicaid last year, only to recover less than $20 million in fraud. At its most optimistic, the state’s recovery rate tops less than 1 percent.

Senate Bill 5978 will give the state new tools in pursuing Medicaid fraud with the hopes of raising tens of millions of dollars in fraud recoveries over the next few years.

Sen. Karen Keiser, D-Kent, chairwoman of the Senate Health and Long Term Care Committee, helped shepherd the package of fraud bills in the past two sessions.

“The bill allows us to be party to over 100 ongoing cases of multistate fraud around the country that already exist and are under way, that we are denied access to right now,” Keiser said in a press release. “In the last three years, Washington has missed out on our proportionate share of over $1 billion.”

“Without this tough enhancement of our False Claims Act our state has been almost powerless against the corporate culprits who defraud taxpayers through false Medicaid claims,” Sen. Cheryl Pflug, R-Maple Valley, prime sponsor of the legislation, said in the release. “Fraud only leads to higher health-care costs, and as the Medicaid program grows the need to deter fraud grows as well.”

The bill was just one piece in a series of legislation designed to cut Medicaid fraud waste and abuse.

HB 2571, sponsored by Rep. Kevin Parker, R-Spokane, passed the Legislature as well.

The bill will reform the way Washington combats fraud and waste in medical services by focusing on prevention and early detection, as opposed to the state’s current “pay and chase” model.

“Projected savings for this legislation range from $30 million to $150 million,” Parker said in the release.

SB 5978 and HB 2571 now head to the governor to be signed into law.

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