Idaho kids health insurance system may have been overpaid

Kids Health Insurance - Doctor, child, stethoscope

The federal government claims it paid $3.1 million too much, thought the state disagrees.

A federal agency claims it overpaid the Idaho kids health insurance program by $3.1 million from 2010 through 2013. This, according to an Office of Inspector General (OIG) of the U.S. Department of Health and Human Services audit.

Idaho completely disagrees and says that all the payments it received were fully justified.

The kids health insurance audit suggested that there was an overpayment and that it was Idaho’s fault. The report indicated the state should be required to repay the money it was overpaid. On the other hand, Idaho officials entirely disagree. The state officials say they followed the regulations and that they received fairly distributed money.

The funds in question were from a multibillion dollar bonus program. Congress authorized the insurance bonus program in 2009. Its purpose was to assist states in covering all the children requiring government health insurance. The bonus was in response to the increased demand on the system from the 2008 financial crisis

The OIG’s other investigations suggest at least ten states received kids health insurance overpayments.

In the case of the investigation in Idaho, the state is accused of having “overstated” the number of eligible children. The government’s investigators said each state was provided with specific categories applicable to the bonus program. However, they also said Idaho included an additional category of children.

Idaho submitted the additional category of “blind and disabled.” From 2010 through 2013, the federal government paid $3.1 million to cover those children through the bonus program. The government investigation suggests the state was not entitled to those funds.

The Idaho Department of Health and Welfare (IDHW) openly admits to having included “blind and disabled” children as eligible for the program. Equally, the department explained that the bonus regulations allowed for such inclusions.

“If Congress intended [blind and disabled] children to be excluded, it would have,” specifically excluded them from the kids health insurance bonus program, said IDHW Director Russ Barron in a written response to the investigation conclusions. The Centers for Medicare and Medicaid Services interpreted the regulation in a way that was “erroneous, contrary to statute, and does not withstand scrutiny,” he added.

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