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D.C. owes feds tens of millions for Medicare mismanagement
By Bill Myers
The Examiner (Washington, DC)
November 23, 2008
The District [of Columbia] will have to give tens of millions of dollars, and possibly hundreds of millions, back to the federal government after an audit discovered widespread mismanagement in the city’s Medicaid program.
Officials in the school system and the child welfare agency routinely approved payments without checking invoices and disbursed taxpayer dollars without proper documents, Mayor Adrian Fenty said Friday. The mayor and his aides refused to say how much money was at stake, but said that the mismanagement occurred between at least 2003 and 2006.
“I can’t really give you the numbers. They’re all over the lot,” Attorney General Peter Nickles told The Examiner. “We’re going to find out what the bottom line is.”
A Fenty administration official who spoke on condition of anonymity said that there could be hundreds of millions of dollars going back to the feds, just as D.C. is facing its worst budget shortfall in years.
Nickles has already had to fend off a major federal fraud suit after U.S. auditors discovered similar Medicaid billing problems in St. Elizabeths, the city’s mental hospital. Federal officials initially sought $48 million in fines and penalties. A settlement reached earlier this year allowed the city to avoid paying fines, but D.C. had to surrender control of St. E’s to the federal government.
Fenty briefed the council Friday morning at an emergency meeting and then addressed a hastily assembled media conference. He promised to overhaul the city’s foundering Medicaid program.
Nickles said that states commonly have trouble handling Medicaid.
“It’s not just my client who has been involved,” he said. “D.C. is not unique.”
The audit was started after a 2007 review said the instability in the Medicaid program threatened the city’s bond rating. The company conducting the audit, Bert, Smith, has asked the city for additional money to continue their work, a city hall source said.
City Chief Financial Officer Natwar Gandhi issued a statement via e-mail Friday, saying Medicaid has been “a perennial concern of mine.”
Councilman Phil Mendelson, D-at large, said Friday, “The public has a right to know what’s at issue. I’m concerned.”
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