Q&A of the Day – DOGEing Fraud & Abuse in Medicare & Medicaid
Each day I feature a listener question sent by one of these methods.
Email: brianmudd@iheartmedia.com
Social: @brianmuddradio
iHeartRadio: Use the Talkback feature – the microphone button on our station’s page in the iHeart app.
Today’s Entry: Kick illegal migrant invaders off of Medicare and save how much, @brianmuddradio...?
Bottom Line: Recently, while breaking down DOGE’s findings and outlining their projected savings, we’ve broken down what’s behind Social Security’s looming insolvency and discussed the role that waste, fraud and abuse have contributed to the programs’ long term solvency challenges. During that analysis, I also brought you this ditty regarding the second largest entitlement program...
One of the biggest areas sought for savings by DOGE is turning out to be Medicaid where an initial review shows that $800 billion in savings can be achieved by simply applying work requirements which used to be in place back into place. Why? Because only 44% of adult Medicaid recipients are working full time. And as for the remaining 56% who are on Medicaid but aren’t working full time... a study has shown only 2% currently aren’t working because they couldn’t find full-time work. In other words, it’s a choice for most on Medicaid to not even attempt to find full-time work – much less to do it.
I’ve had multiple questions come up since that analysis including questions asking about the implications for Medicare like today’s note. It appears some listeners may have thought I was discussing Medicare as opposed to Medicaid and there may also be some confusion about which program has been abused by illegal immigrants. So, about that...
Medicare is only available to non-citizens under this condition:
- Be an alien who has been lawfully admitted for permanent residence and has been residing in the United States for 5 continuous years prior to the month of filing an application for Medicare.
That’s in addition to being 65 or older. Most recently the federal government’s General Accountability Office has identified that massive waste fraud and abuse has occurred with an estimated $236 billion in “improper payments” during the most recent fiscal year across all federal government agencies with $100 billion of that coming in Medicare and Medicaid abuse. Specific to Medicare fraud, however, illegal immigrants don’t appear to be much of a factor. Medicare abuse is much more complicated for illegal immigrants to pursue than even attempted Social Security abuse. Unlike Social Security payments, in which an illegal immigrant may be able to successfully steal one’s identity (often a deceased person), and potentially collect payments illegally, the added challenge of having to provide identification to a Medicare service provider to obtain service, significantly limits the likihood of this type of abuse. It’s also unlikely that illegal immigrants would be able to present as a medical service provider to the federal government to receive bogus Medicare payments at the service provider level. Where the abuses by illegal immigrants show up significantly is within Medicaid fraud.
According to the Congressional Budget Office, illegal immigrants accounted for $16.2 billion in Medicaid spending over the prior year. This commonly happened in sanctuary states that enabled those lacking legal status to access Medicaid resources. While Medicaid is administered at the state level, most of it is paid for through the federal government.
In the most recent year, 69% of Medicaid funding was provided through federal funding. This means all federal taxpayers have been defrauded by the states that have allowed for this, which is one of many reasons why DOGE’s work in this area is important, but also why it will be important for the Trump administration to follow through on their promises to withhold federal funding for sanctuary jurisdictions.
As for saving Medicare... Medicare’s fiscal outlook is slightly better than Social Security’s. Current insolvency is projected for 2036, when it's estimated that only 89% of benefits would be able to be paid out. However, the amount of revenue needed to address that shortfall totals a whopping $2.3 trillion over the next decade to stave off insolvency. Eliminating all of the estimated fraud would account for only about 43% of the shortfall.