Inspector General: Illinois Spent Too Much Federal Medicaid Money

An audit reveals the state overdrew its account by millions from 2010-2012

An audit by the Inspector General at the U.S. Department of Health and Human Services reveals that Illinois overdrew on its federal Medicaid account due to "faulty" and "imprecise" bookkeeping, the Chicago Tribune reports.

The audit found the state took out an average quarterly excess of $60 million between 2010-2012, funneling the money into a general fund that covers pension, education and transportation costs, according to the Tribune. As such, when it came time to return the overdrawn cash to the feds, Illinois could not afford to pay back the government and was up to six months late in doing so.

Mike Casey, a staffer with the Illinois Department of Healthcare and Family Services’ finance branch, pegs the problem on outdated Medicaid processing software that slows down the system (and contributes to budget mishaps) because there is no real-time claims data to give an accurate, up-to-date estimate of how much the state can withdraw from the feds' Medicaid account.

"When you look at a $60 million variance per quarter, that’s not much of a variance on average when you consider we have $3 billion in claims each quarter," Casey told the paper, putting the three-year accounting gaffe into perspective.

Casey said Illinois is in the midst of modernizing its Medicaid claims process, an update which should take effect in 2017.

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