I wrote earlier this month about pervasive corruption and fraud in Minnesota’s Medicaid program.
Now that the issue has become big national news (I first started writing about Medicaid scams more than 12 years ago), let’s take a more detailed look at the problem.
We’ll start with this chart showing that overall spending on Medicaid is a national problem (by the way, spending is expected to reach nearly $1 trillion this year!).
The national Medicaid problem is exacerbated by state policies.
And Minnesota is among the worst of the worst.
As illustrated by this map, it has the second-highest per-capita spending in the country (keep in mind that federal taxpayer pick up almost two-thirds of cost of Medicaid).
When I look at this map, the first question that springs to mind is why Minnesota is spending about twice as much, per recipient, as a state like Florida?
Is it because of differences in the amount of illegal fraud?
Is it because of differences in the level of legal fraud?
Or is it simply a matter of some states having responsible governance while states like Minnesota are poorly run?
Regarding the last question, the Wall Street Journal has an editorial comparing Minnesota and Indiana. The Minnesota analysis is depressing.
Minnesota’s great welfare heist is…”staggering industrial-scale fraud,” Assistant U.S. Attorney Joe Thompson said. “When I look at the claims data and the providers, I see more red flags than I see legitimate providers.” Mr. Thompson estimates fraud losses since 2018 could top $9 billion.
…The state’s Medicaid spending has increased by nearly two-thirds in six years. Mr. Walz says his administration has begun to inspect Medicaid claims more closely. But because the feds pick up most of the Medicaid tab, Minnesota and other states have less incentive to identify fraud and waste. Medicaid spending nationwide has increased by some $380 billion since the beginning of the pandemic as providers and beneficiaries dine out on the all-you-can-eat buffet.
By contrast, Indiana lawmakers have actually sought to save money for taxpayers.
The inexorable spending growth spurred Indiana Republicans this spring to impose reforms, including more rigorous eligibility checks and guardrails to prevent excessive billing. Last week the state said it expects to save $466 million on Medicaid over the next two years compared to its spring projections. Medicaid enrollment has declined by some 11% thanks to eligibility checks. …Indiana’s Medicaid spending is expected to grow 3.2% this year versus its 9.5% forecast.
I’ll close today’s column with my recommendations, all of which are contained in my 2011 video on Medicaid reform.
If you don’t have a spare five minutes to watch, here’s all you need to know.
- Replace the federal entitlement with a block grant,
copying the success of welfare reform in the 1990s while also eliminating the perverse incentive for both federal and state lawmakers to expand the program. - Phase out the block grant so that states ultimately are fully responsible for providing health care to low-income citizens. – including both raising the revenue and deciding how it gets spent.
In other words, it’s time to end the Washington redistribution racket. If Tim Walz thinks it is politically beneficial to turn a blind eye to fraud, let’s at least make sure only Minnesota taxpayers are bearing the burden.
P.S. There’s also plenty of Medicare fraud.
International Liberty 
