New Jersey State Audit Finds Lack Of Oversight In NJ FamilyCare, Medicaid Programs

Main Category: Medicare / Medicaid / SCHIP
Article Date: 03 Apr 2008 - 10:00 PDT

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NJ FamilyCare, a subsidized health program in New Jersey, did not verify eligibility for all of the program's beneficiaries, and more than 873 people with annual gross incomes more than $85,000 received benefits through the program, according to a report by State Auditor Richard Fair, the Bergen Record reports. Uninsured children and parents in families with annual incomes below 350% of the federal poverty level are eligible for the program. According to the three-year audit, state Department of Health and Senior Services officials sought to check applicants against the state's wage, disability and unemployment records to verify income, but the records did not have data on self-employment and rentals, interest or dividends.

The report found, "Although beneficiaries authorize the Division of Taxation to release their tax returns to the NJFC program when signing their application, the division does not currently perform a computer match of all beneficiaries with state tax files." According to the audit, three residents with incomes exceeding $700,000 annually were enrolled in the program, and three other beneficiaries were determined eligible in 2006 because they did not report self-employment annual income of between $177,700 and $295,000, as they had on their tax returns.

State auditors also found that DHSS officials did not attempt to recover $4.6 million in unpaid fees to NJ FamilyCare by 16,300 former beneficiaries and that the program paid $43.1 million in claims for 13,000 residents even though the agency had not verified they were still eligible for coverage (Wright, Bergen Record, 4/1).

Auditors also found that the state's Medicaid program did not adequately monitor medical equipment providers. Between July 2005 and December 2007, the state spent $2.1 million for equipment that nursing facilities should have paid for. The state also spent $6.7 million more in state and federal money than was needed for oxygen equipment and adult incontinence briefs (Hester, AP/Philadelphia Inquirer, 4/1).

Assistant State Auditor Stephen Eells said the Office of State Auditor did not forward any of the cases tied to NJ FamilyCare to criminal justice officials, adding, "We just want to get the weaknesses fixed. That's our goal. This is something they are going to pursue and get fixed" (Bergen Record, 4/1). However, state criminal investigators are looking into the Medicaid program cases (AP/Philadelphia Inquirer, 4/1).

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