Auditor: Medicaid could save on equipment, transportation

Tuesday, October 4, 2005

JEFFERSON CITY, Mo. -- The state could be paying less for medical equipment and transportation service for Medicaid patients, an audit released Monday found.

The audit determined that two Medicaid services -- one providing medical equipment and the other nonemergency trips, such as to doctor's offices -- cost about $100 million from January 2003 through March 2004.

Of that, Medical Transportation Management Inc. received $44.1 million for arranging rides for Medicaid patients, making at least $19 million in gross profit, said the report by State Auditor Claire McCaskill.

Under its state contract, the Lake St. Louis-based company chooses the method of transportation. The audit said the company is paid much more when sending people by taxi or their own vehicle than on public transportation.

For example, the company was paid $2.80 if a person took public transportation but $34.90 if that person used a taxi. In another case, when a patient used his own vehicle, the company paid the person 15 cents a mile, or $3.60, for the trip, but the state paid the company $98.44 for administrative services.

The audit also found the Department of Social Services did not properly check up on the company to ensure billed trips were legitimate.

McCaskill said the agency should audit the company's work and require documentation to prove trips were needed, especially if they are to non-Medicaid providers such as a store giving out flu shots.

In a written response to the audit, the department said auditors' concerns would be considered as the legislature's Medicaid Reform Commission develops recommendations to change the government health-care program for the poor.

McCaskill contended that providers waste more money in Medicaid than patients.

"It is tiresome to most Missourians to continue to have this rhetoric that the Medicaid problem should be borne on the backs of recipients when we know that there is meaningful and real savings that can be found," she said.

Last week, Attorney General Jay Nixon announced that Medical Transportation Management was paying $2.4 million to resolve a state investigation.

Nixon said he had concerns about Medicaid fraud, contract problems and antitrust violations. The company denied doing anything wrong but said it was better to settle the case than to continue with costly litigation.

The state currently is reviewing bids and expects to award a new contract soon for the medical transportation service.

MTM is among the bidders for the new contract. The state earlier this year said it was canceling the company's current contract, but it has remained in place on a monthly basis while new bids were sought.

"We have been aggressively working to discover contracts and practices since January that need increased oversight and management," agency spokeswoman Deborah Scott said. "(Medical transportation) is an example of a program where the department has been aggressively pursuing such improvements."

McCaskill said auditors should monitor the new contract to see if it really saves the state money, saying it won't if rates are based on high costs under the current system.

The audit also said the federal government found other states could save money by seeking bids for medical equipment, and said Missouri could save about $5.4 million a year. The agency said it would review whether bids would be cost-effective.

The audit also found Missouri often paid more for the same equipment than surrounding states, and that the state should encourage patients to use Missouri businesses rather than out-of-state vendors when in-state companies could provide the same items.

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