The Cost of Incompetence - Ken Block
Ken Block, MINDSETTER™
The Cost of Incompetence - Ken Block
Years of audit reports from RI’s Auditor General also highlight serious technical and operational deficiencies with UHIP that cost us many tens of millions annually. It is outrageous that the problems I am about to describe to you have not been addressed by the State and its contractor, Deloitte.
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Eligibility is a key function of UHIP. The software system is supposed to know the laws and regulations that govern the different benefit programs and, critically, enforce the rules for who is eligible to receive benefits. Eligibility differs from program to program and can include factors like age, income, family size, etc.
From the very beginning, UHIP has botched its eligibility duties. News stories from years ago detail tens of millions of dollars of eligibility mistakes made by UHIP.
As the audit reports describe, those mistakes are still happening today. The annual cost of the problems I describe below is projected at almost $100 million.
The audit takes a random sample of people receiving benefits in each program and looks for errors in eligibility. A large enough sample allows for an estimate of the size of the mistake across the entire program.
What follows is not pretty and comes from the 2023 statewide audit published by the RI Auditor General. http://www.oag.ri.gov/reports/SA_RI_2023.pdf
On page 360, the auditor found that RIBridges contained deficient documentation for TANF eligibility. A sample size of 68 cases yielded an error rate of 11.7%. When we extrapolate the error rate across all TANF beneficiaries, the projected annual cost of improperly eligible TANF recipients is $2.8 million.
Incredibly, the 2022 auditor report (page 365) identifies worker noncompliance as a contributing problem for TANF. If the state employees in charge of administering these programs are not enforcing the program rules, what are we supposed to do?!
On page 367 of the 2023 audit, Child Care eligibility had a sample error rate of 7.5%, extrapolating to a projected annual cost of $4.2 million.
On page 368, CHIP (Children’s Health Insurance Program) eligibility errors (including aging out of the program) have an extrapolated cost of $1 million.
On page 380, the Auditor General found Medicaid eligibility wage exclusion errors (you do not qualify for Medicaid if you make too much money), but somehow, UHIP did not find those errors. Medicaid eligibility in RI is so bad that someone determined to be ineligible for Medicaid in 2019 was still on the rolls in 2023.
The auditor found a 5% Medicaid eligibility error rate. Medicaid was a $1.8 billion program in fiscal year 2023, with $500 million coming from state taxpayers. The program incorrectly paid out an extrapolated $90 million, with $25 million coming from state taxpayers.
The age at which one is no longer eligible for Medicaid is 65. There were more than 1,000 Medicaid recipients over the age of 65.
Don’t even get me started on the Medicaid payments made for people who don’t live in Rhode Island or, worse, who also got Medicaid benefits from other states.
Lastly, the Department of Labor and Training helped to screw up Medicaid eligibility based on earnings by providing incorrect earnings data to UHIP. See page 379. The incompetence throughout our government costs us at every turn.
The bottom line
Audit report findings are not suggestions. They highlight mistakes, vulnerabilities, and deficiencies in our government's operations. In most well-run states, you never see the same findings in multiple audit reports across multiple years.
I’d like to have that $100 million back. Anyone else?