- The Washington Times - Monday, February 10, 2014

Food stamps. Free meals. Cable TV. Unemployment and disability benefits. And now prescription drugs.

It’s a good time to be in prison, where inmates are mistakenly receiving tens of millions of dollars in benefits at taxpayer expense.


PHOTOS: Top 10 handguns in the U.S.


The latest folly comes compliments of Medicare, which gave such poor oversight to its prescription coverage that it allowed $11.7 million in drug benefits to go to inmates from 2006 to 2010, according a report released Monday by the Health and Human Services inspector general.

“Individuals who are incarcerated in correctional facilities … are generally not eligible for federal health care benefits,” the agency’s internal watchdog said in a report that blamed officials at the Centers for Medicare and Medicaid Services for poor management.


Investigators found that medical companies that gave drugs to inmates were improperly allowed to claim Medicare reimbursements because CMS lacked the safeguards necessary to screen out prisoners, and did not supply the medical companies the information needed to check for themselves.

The revelation was made a year after the same inspector general found that Medicare inappropriately paid $33.6 million to health care providers to cover costs associated with medical treatment for inmates.

CMS officials acknowledged the problem but said their accounting is so disorganized that they don’t even have a way to recoup the drug benefits they have misspent.

An audit last fall by the inspector general of the Social Security Administration found more problems with prisoners receiving taxpayer dollars. In a sampling of 100 Social Security disability recipients, one out of four had been receiving the benefit — wrongfully — while incarcerated.

“There’s no effective way to stop these improper payments, because no one really has any incentive,” said Michael Cannon, a health policy analyst at the Cato Institute, a libertarian think tank. “It’s all someone else’s money, so nobody cares to prevent fraud as much as they should. This is maybe the main reason why government is less efficient than markets.”

Getting an exact amount of how much is being wasted annually from Medicare payment mistakes is difficult, but some estimates place the number as high as $50 billion.

Erroneous benefits to prisoners also have been flowing through states. Investigations at the state level found $1 million in food stamps given to inmates in Louisiana. Fiscal watchdog Citizens Against Government Waste reported that prisons in Illinois spent $2.3 million on cable TV bills. A House of Representatives hearing in September found that prisoners received $23 million in unemployment benefits in New Jersey, $2 million in Illinois and $600,000 in Wisconsin.

“It is an injustice that the tax dollars of law-abiding citizens are paying for these benefit checks for people who have broken the law and simply should not qualify for these benefits,” Rep. David G. Reichert, a Washington Republican who chairs the Ways and Means Human Resources subcommittee, said during the hearing.

Benefits behind bars

Medicare Part D pays for prescription drugs, but convicted felons are supposed to lose their benefits when they go to prison — along with many of their other rights and privileges. Instead, the Justice Department’s Bureau of Prisons takes charge of many health concerns for inmates.

Officials at CMS agreed there was a problem and said they would work to fix it.

Story Continues →