Key Takeaways:
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- Medicaid paid $4.3 billion in duplicative premiums between 2019 and 2021 for patients enrolled in multiple states, with private insurers like Centene, Elevance, and UnitedHealth benefiting from the payments.
- The issue stems from patients moving between states without canceling their previous Medicaid enrollment, leaving states to pay insurers in both locations.
- Federal emergency rules during the pandemic exacerbated the problem, increasing duplicative payments from $814 million in 2019 to $2.1 billion in 2021.
- Insurers argue that states are responsible for verifying eligibility, while states cite challenges in identifying and disenrolling patients who have moved.
What Happened?
A Wall Street Journal investigation revealed that Medicaid, the federal and state-funded healthcare program for low-income individuals, paid billions in duplicate premiums to private insurers for patients enrolled in multiple states. The payments occurred when patients moved to a new state and signed up for Medicaid without canceling their previous enrollment.
The three largest Medicaid insurers—Centene, Elevance, and UnitedHealth—collected $1.26 billion in duplicative payments during the three-year period. Centene alone received $620 million, with some cases involving the same insurer covering a patient in two states simultaneously.
The federal government relies on states to monitor Medicaid eligibility, but states often fail to identify patients who have moved until annual eligibility checks. This delay allows insurers to collect months of extra payments.
Why It Matters?
Medicaid and Medicare cost taxpayers over $1.8 trillion annually, and duplicative payments represent a significant waste of public funds. The issue highlights inefficiencies in Medicaid’s administration, particularly in verifying eligibility across state lines.
The problem also raises questions about the role of private insurers, which are paid monthly premiums regardless of whether patients use services. Critics argue that insurers have little incentive to flag duplicate enrollments, while insurers claim they follow state rules and return excess funds when required.
The pandemic-era rules that limited disenrollments further worsened the issue, but even after those rules were revoked in 2023, states continue to struggle with identifying and addressing duplicate payments.
What’s Next?
The Centers for Medicare and Medicaid Services (CMS) has pledged to work with states to address the issue, but it has rejected recommendations to use national data to detect duplicate enrollments. States like Georgia and Indiana are implementing measures such as quarterly eligibility checks and fraud investigations to reduce waste.
Policymakers and regulators must decide whether to strengthen oversight of Medicaid insurers or implement federal systems to track patient eligibility across states. Without significant reforms, taxpayers could continue to bear the cost of inefficiencies in the Medicaid system.
