Kansas Medicaid inspector general tells Committee on Government Efficiency audits found millions in improper payments and gaps that limit recoupment

The Kansas Medicaid Inspector General told the Committee on Government Efficiency on Oct. 12 that the office’s audits and investigations have identified hundreds of millions of dollars in waste, improper payments and program vulnerabilities and urged changes to contracts, state practices and federal rules to improve recovery and prevention.

The inspector general, who leads the Kansas Medicaid Inspector General’s Office within the Kansas attorney general’s office, told senators the Medicaid program’s $5.5 billion annual budget makes even modest rates of fraud and waste costly: “I just use 10%. If you think about Medicaid being a $5,500,000,000 program, if 10% of that is lost to fraud, that’s over $500,000,000 per year in the state of Kansas,” the inspector general said.

The office presented multiple audit findings and sample recoveries to illustrate how money can be lost and, in some cases, regained. Those examples included:

- Medican (a state-only, 12‑month lifetime program): auditors identified $1.6 million in claims for 912 beneficiaries who exceeded the 12‑month limit. Kansas Department of Health and Environment (KDHE) staff removed 556 people from eligibility, producing about $1.2 million in savings, the inspector general said.

- Capitation payments to managed care organizations (MCOs): the office identified $1.3 million in capitation payments made for 25 beneficiaries whose recorded dates of death showed the MCOs had been paid after beneficiaries had died; the inspector general said…