Roth Says Administration Now Sanctioning Abuse of Medicaid Program with Proposed Regulation
WASHINGTON -- The Clinton Administration this morning issued a proposed regulation to address a growing Medicaid spending scandal. Senate Finance Committee Chairman William V. Roth, Jr. (R-DE), who has been calling for action to end the exploitation of Medicaid for months, today said the Administration's proposal is inadequate, and will likely create a worse situation. Roth released the following statement today:
"For months I have been calling on this Administration to act to stop a burgeoning Medicaid spending scandal. Today after months of unnecessary delay, the Administration has pretended to act. Instead of moving forward to stop the scandal, the White House is stepping backward and sanctioning de facto abuse in the Medicaid program.
"The proposed regulation permits facilities to be reimbursed for providing services at a rate one and a half times what Medicare would have paid for a given service. Then states are free to pocket the difference between that payment level and the often much lower Medicaid payment rates through intergovernmental transfers. Not only does the regulation allow those who are exploiting the program to continue to do so, it also invites all others to come in and help themselves. The regulation permits the scam to continue while only modestly attempting to contain its magnitude.
"Simply containing wasteful spending is not sufficient. The American taxpayer who pays the bills should not stand for it, nor should the 40 million low income pregnant women, children, individuals with disabilities, and senior citizens who rely on these vital benefits.
"Not only does the proposed regulation fail to protect the financial integrity of the Medicaid program, it also has a very low probability of ever being implemented. There is virtually no chance this Administration will be able to finalize the proposed regulation before it leaves office in January. Until the regulation is finalized, nothing changes. No abuser state has to modify its behavior one bit, and more and more states will be under pressure to take advantage of the windfall their neighbor states are enjoying. If anything, the White House action may spur greater abuse in the Medicaid program.
"The Congressional Budget Office estimates that truly solving the problem will save taxpayers $127 billion over the next decade. The stakes are high and we owe it to the 40 million Medicaid beneficiaries to protect the program so it remains strong and viable for the years to come."
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