Home / Missouri / Auditor Galloway finds $1 million in questionable spending, inadequate oversight of Medicaid and child care programs

Auditor Galloway finds $1 million in questionable spending, inadequate oversight of Medicaid and child care programs

Missouri State Auditor Nicole Galloway has issued the first in a series of audits related to budget oversight and accountability. The Statewide Single Audit annually reviews the state’s management and spending of $8.4 billion federal dollars, and is part of the State Auditor’s new Budget Integrity Series examining contributing factors to the current budget crisis, including areas with a high risk of inappropriate spending or misuse of funds. The audit raised concerns with a number of oversight areas and identified a million dollars in questionable costs in social safety net programs, like Medicaid.

“As the legislature and governor are making deep cuts, the state simply must do a better job managing taxpayer dollars,” said Auditor Galloway. “State agencies have an obligation to eliminate waste, and it’s frustrating that we continue to find the same problems year-after-year.”

Galloway said that in programs where the state and federal government share the cost of providing services, inappropriately spent tax dollars means potential added stress on a state budget that is already facing a more than half-billion dollar shortfall next year.

The review identified a lack of accountability in two agencies that administer federal funds: the Department of Mental Health and the Department of Social Services. Five of the six findings included in the report were repeat issues from prior year audits. Some of the concerns have been repeatedly raised, including one reported every year since 2010.

In the Department of Mental Health, auditors found the department did not keep records to support daily rates paid to some group homes for individuals with developmental disabilities. This led auditors to question nearly $1 million in payments made last year.

A new issue at the Department of Social Services this year shows the department failed to meet federal requirements to review eligibility information for certain doctors, hospitals and other health care providers. The Medicaid and Children’s Health Insurance Program (CHIP) requirements were put in place to determine whether existing health care providers are eligible to receive reimbursement from the state. Although the department had at least five years to prepare for the new requirements, 87% of providers had still not been reviewed, creating a total backlog of approximately 28,000 providers pending review. The growing backlog also  increases the possibility that tax dollars will go to unauthorized health care providers.

“Taxpayer dollars cannot go to doctors, hospitals and other health care providers who are not eligible to receive payments,” Auditor Galloway said. “Scarce resources mean fewer Missouri families and children may be able to access healthcare because of the inefficiencies and waste we continually find.”

Auditor Galloway also described repeat concerns with safeguards to prevent inappropriate payments through the Department of Social Services child care program, which helps pay child care expenses for approximately 64,000 children at an annual cost of more than $135 million. For the seventh year in a row, auditors questioned the department’s ability to prevent or detect payments to ineligible clients or child care providers and found that some caregivers may have received inappropriate payments.

The audit also found 39 closed pharmacies that were still enrolled and authorized to receive Medicaid and CHIP payments.

In addition, the report recommends the Department of Social Services follow new procedures to ensure license-exempt child care providers comply with state law. Caregivers who care for four or less unrelated children are exempt from licensing requirements, but the department failed to verify the relationship for some children. This creates the risk that care givers can receive public dollars while operating in violation of state law.

A complete copy of the audit report is available online.

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