Kentucky Auditor Report Questions Effect Of Program Restructuring On Costs

Main Category: Medicare / Medicaid / SCHIP
Article Date: 20 Dec 2007 - 12:00 PDT

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It is impossible under the current Kentucky Cabinet for Health and Family Services reporting process to determine whether a 2006 restructuring of the state's Medicaid program saved money, according to the state auditor's office, the AP/Louisville Courier-Journal reports (AP/Louisville Courier-Journal, 12/17). According to a report by state Auditor Crit Luallen, estimates by former Gov. Ernie Fletcher (R) that the changes would bring about $120 million to $130 million in annual savings could "not be substantiated because of inconsistent and confusing reporting practices." Auditors found that Medicaid costs increase by $42 million over the previous fiscal year and by $56 million if administrative costs are taken into account.

Luallen said that the audit, "coupled with [a] recently disclosed $389 million Medicaid shortfall in the current year, underscores the need for transparency in Medicaid reporting." According to Luallen, "True reform will be impossible to track or verify until significant improvements in reporting occur."

The audit included several recommendations to improve transparency, including requiring the cabinet to report progress and costs in a consistent and easier-to-use form (Musgrave, Lexington Herald-Leader, 12/18). Findings of the audit will be sent to the office of Gov. Steve Beshear's (D) administration as well as to state lawmakers (AP/Louisville Courier-Journal, 12/17).

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