A federal court has ordered the D.C. government to pay more than $900,000 in fines for failing to provide adequate Medicaid service to the District’s children from low-income families, in a ruling some lawyers say shows a fundamental problem with the health insurance program.
The District is supposed to provide the children with health screening and treatment but has shown “persistent and long-standing” failures to meet deadlines for providing the services, said the ruling from the U.S. District Court for the District of Columbia.
The ruling is a follow-up to a class-action lawsuit filed by the D.C. law firm Terris, Pravlik & Millian and the National Health Law Program on behalf of the District’s low-income residents who rely on Medicaid.
The D.C. government reached a settlement agreement with the plaintiffs in 1999 that set standards for Medicaid services and deadlines for providing them. Among the standards and deadlines not met are failing to file a report on a children’s oral health program by April 15, 2007, and failing to provide a timely plan on testing children’s blood for lead.
In her ruling last week, Judge Gladys Kessler fined the D.C. government $931,050 for failing to meet deadlines for service.
“What the case is about is institutional failure to provide those necessary services,” Judge Kessler wrote.
The D.C. government failed to comply with Medicaid laws, court orders “and with the settlement agreement which it negotiated with the plaintiffs approximately nine-and-a-half years ago,” she wrote. “Most significantly, it is about failure of the political leadership in the District of Columbia government to make available the resources necessary to achieve compliance with the Medicaid statute and the settlement agreement.”
D.C. government officials denied any wrongdoing Friday.
“We have substantial ground for an appeal and will continue to provide citizens of the District with quality Medicaid service,” acting D.C. Attorney General Peter Nickles said.
Medicaid is a health program for low-income people funded jointly by the federal government and the states plus the District of Columbia. The states and the D.C. government administer the program.
The plaintiffs asked the court to impose fines on the D.C. government in 2006, saying Medicaid administrators did not fulfill their obligations under the Medicaid program or the settlement agreement.
Attorneys for the District argued in one point of defense that the D.C. government missed the oral-health program deadlines because of the difficulty in collecting data on participating children.
“Unfortunately, the District has enormous data problems, which impact many important provisions of the various orders entered in this litigation,” wrote Judge Kessler. “That situation cannot constitute an excuse for simply ignoring those orders.”
National Health Law Program officials say the problem might be rooted in Medicaid’s “managed care” policies.
Beginning in the 1980s, many states and the District shifted to greater use of prepaid Medicaid services, rather than reimbursing health care providers after they treated patients. The programs were designed to control costs.
The problem with the government paying health care providers before they render services is that “they’re not providing them,” said Jane Perkins, legal director for the National Health Law Program, a public interest law firmthe plaintiffs in the case.
Health care providers are paid based on the number of people enrolled in Medicaid prepaid programs, but only a portion of enrollees actually receive health services, Ms. Perkins said. Some state programs are better than others in ensuring treatment for Medicaid recipients, she said.
In the District, less than half the children enrolled for Medicaid dental services in 2006 received dental care, she said.
By 2004, about 60 percent of Medicaid benefits were paid through managed care programs. All states except Alaska, New Hampshire and Wyoming have at least part of their Medicaid recipients enrolled in managed care programs.
Several states and the federal government are caught up in disputes over Medicaid.
In May, the D.C. federal district court overturned Bush administration regulations that would alter and reduce Medicaid reimbursements to hospitals and nursing homes. The ruling by Judge James Robertson said the regulations were “deliberately designed to outfox a clear directive of Congress.”
In West Virginia and Texas, state Medicaid reform programs are enduring criticism that they bend federal rules too much and might leave some low-income persons without adequate health insurance.
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