Smart cards pushed to reduce Medicaid fraud

A Senate panel Wednesday approved a bill authorizing a pilot program that would use smart card technology to verify patients’ identity, in an effort to reduce fraud in Georgia’s Medicaid program.

The Senate Health and Human Services Committee, though, dropped a requirement for fingerprint identification of Medicaid patients at a doctor’s office or hospital.

The anti-fraud pilot program, if ultimately approved by the Legislature, would last three to six months and take place in three different areas of the state, yet to be identified. If the pilot cuts average monthly patient costs by at least 5 percent, the program would roll out statewide, according to the new version of Senate Bill 63.

The original bill’s lead sponsor, Sen. John Albers (R-Roswell), told the committee that Georgia last year prosecuted and recovered $26 million in fraud cases. The proposed fraud initiative would add to that, he said, ‘’and would preserve the [Medicaid] program for those who truly need it.’’

The legislation is intended to catch fraud among both patients and medical providers, Albers said.

A fiscal note on the original bill, from the Department of Audits and Accounts, said the smart card and fingerprinting pilot would cost about $600,000. Some senators on the panel said that money would be better spent in beefing up the current state Medicaid task force on fraud.

That unit ‘’has a track record of finding and prosecuting fraud in the millions [of dollars],’’ said Sen. Nan Orrock (D-Atlanta).

Sen. Johnny Grant (R-Milledgeville) said he also would prefer to spend the money ‘’in the existing [fraud] program with proven capability.’’

Grant later sponsored an amended version of the bill that removed the requirement for fingerprinting and left unanswered the question of which technology to use for identification.

A spokeswoman for the agency that runs Texas’ Medicaid program said this week that the state will soon roll out a smart card for Medicaid recipients. But state officials decided not to pursue fingerprint identification after trying it in pilot programs.

Fingerprinting doesn’t work as well for certain occupations and populations, including people with Nigerian backgrounds, experts testified before the Senate panel.

“It’s not a silver bullet,’’ said Darrell Geusz of the Pegasus Program, which connects law enforcement databases. Multiple technologies are needed to ensure reliability, he said. “It’s a logistical nightmare to work with all these providers.’’

The original bill called for a fingerprint device to be located at Medicaid providers’ offices.

The panel cited prosecutions of doctors and companies billing for patients who are deceased or who never received services. The legislators also discussed how much fraud exists on the consumer level, with one patient passing a Medicaid card on to another who is not enrolled.

“We know people are card swapping,’’ said Sen. Tommie Williams (R-Lyons), the president pro tempore of the Senate. A Baxley physician, Dr. James Graham, testified that much card swapping occurs in emergency rooms.

Rick Ward of the Georgia chapter of the American Academy of Pediatrics, though, said ‘’we don’t see a lot of card swapping’’ in pediatricians’ offices.

And Robert Finlayson, the inspector general of the Department of Community Health, said in the past two and a half years, the agency has found just three substantiated cases of Medicaid card sharing.

Performing financial audits is an effective way to detect overpayments to providers, Finlayson told the Senate panel.

Consumer advocacy groups said the amended bill – without the fingerprinting requirement – was an improvement on the original legislation.

Joann Yoon, associate policy director for child health at Voices for Georgia’s Children, an advocacy group, said she still had concerns about the possible administrative burden on medical providers, and about whether the method of identifying patients that Georgia ultimately chooses would meet federal guidelines.

“A lot will depend on the proposals from vendors, and what criteria the state will use to select a vendor,’’ Yoon said. “It depends on what they decide to pursue.’’