The Oregon Health Authority could be spending as much as $37 million per month on Medicaid for people who aren’t eligible for the health care program for low-income adults and kids.

A searing “Auditor Alert” issued Wednesday from Oregon’s Secretary of State says as of May 1 more than 80,000 people — about 8 percent of the state’s Medicaid population — had not undergone annual eligibility determinations that are required under federal law.

The OHA sees the situation differently. The agency is in the midst of a years-long process of transitioning its membership from the failed Cover Oregon exchange to a new electronic enrollment portal. As it does, it has to contact each member and determine whether that person is still eligible. The OHA says 84,000 people are still in question, but spokeswoman Courtney Crowell said that does not mean they’re ineligible for the program.

“Very likely most of those people that do go through the redetermination process are likely still going to be eligible for Medicaid,” she said.

In addition to issuing his alert publicly, Secretary of State Dennis Richardson shared the “urgent” information with 90 lawmakers. In an interview with The Bulletin, he said a high-level OHA whistleblower provided him the “disturbing” information, which the agency had not shared during his office’s ongoing audit.

“We were being stonewalled,” he said. “We finally just had to publish it because the Legislature is considering the OHA budget, and these questions need to be asked by those who have authority to get answers.”

Federal law requires states to reassess whether their Medicaid recipients are still eligible each year.

The federal government granted OHA a break from processing those redeterminations between January 2015 and June 2016 as the state transitioned people out of the Cover Oregon system, which contained both Medicaid and privately insured individuals.

Richardson said despite that deadline coming and going, thousands of people have remained on Medicaid without having their eligibility rechecked.

OHA has relied on paper applications to get everyone into the state’s new electronic portal, and the information has been manually entered into the portal, a process that’s gone on for two years.

So far, 734,000 people out of the more than 1 million people on Medicaid in Oregon have been entered into the new system and their eligibility confirmed.

About 14,000 people have not responded to notifications from OHA and are in the process of being removed from the program. Federal and state laws preclude agencies from kicking people off programs without first giving them the opportunity to respond, Crowell said.

“We just have to wait the proper amount of time before we terminate benefits,” she said.

Medicaid recipients often don’t think to provide OHA with current addresses or phone numbers after moving, which commonly results in losing coverage through the program. Low-income families tend to move more often, especially if they’re displaced by rent increases, said Sen. Elizabeth Steiner Hayward, a Democrat from Portland.

“You have the stress of the fact that you have to move frequently and then because the Health Authority can’t find you, you get cut off Medicaid … which makes it worse because it exacerbates chronic health conditions,” she said.

To date, roughly 17,000 people have responded to the OHA renewal notifications and their eligibility is being determined, a process that’s projected to be done by Friday.

By May 31, OHA expects to have analyzed the remaining group of 84,000 people to determine whether they need to have their eligibility redetermined or whether they’re in certain categories, such as a breast and cervical cancer treatment program, that don’t require such action, Crowell said.

Steiner Hayward, who co-chairs a joint House and Senate budget committee on human services, has worked with the OHA throughout its transition and said it’s naturally a slow process given the systems they’re working with.

“It’s important to be very methodical about it,” Steiner Hayward said. “It’s important not to kick people off the health plan when in fact they’re eligible.”

Steiner Hayward said Richardson’s numbers are misleading and incomplete. She said she and other lawmakers asked him to wait until he had more complete data.

“He’s chosen to release partial findings early in the past when the full audits end up showing there isn’t a problem,” Steiner Hayward said. “That’s disappointing to me because that’s not how the auditor’s office has historically worked.”

The Joint Committee on Ways and Means Subcommittee on Human Services will host a hearing Tuesday on the issue.

Medicaid benefits are provided through a combination of state and federal funding, and Richardson said covering people who are not eligible could place federal funding in jeopardy. The federal government currently pays for roughly 75 percent of Oregon’s Medicaid program.

Richardson clarified he hasn’t gotten any indication that the federal government will take that money back.

“We certainly don’t want to feed a rumor in that regard, because that is the last thing we would like to see happen,” he said.

Richardson’s office will issue two audits this year on the subject. The first will cover Medicaid information systems. The second will examine improper Medicaid payments. The office recommended OHA work with federal regulatory agencies to ensure Medicaid funding is not compromised while it resolves the issue. It also directed the Legislature to require OHA to report on its work to resolve the program no later than Sept. 30.

—Reporter: 541-383-0304,

tbannow@bendbulletin.com

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