Medicaid Program Audit Holding Up Bonds For Infrastructure

HELENA, Mont. (AP) — An ongoing audit of Montana’s Medicaid program threatens to delay or increase the costs of infrastructure projects approved by the Legislature, state officials said.

The governor’s budget office and the state health department are at odds with a Legislative Audit Division finding that says it’s “reasonable” the federal government will require repayment of at least $130 million in Medicaid funds.

Budget Director Tom Livers said Wednesday the state sought to sell $80 million in bonds in November, but auditors wouldn’t sign off on the financial disclosure to investors without including the possible liability to Medicaid.

The governor’s office and the state health department argue the audit division used a small sample and the wrong criteria in finding a 50% error rate in determining Medicaid eligibility, compared to the .4% error rate found by the federal government.

The state will not recognize the “fictional liabilities associated with the Medicaid program,” said Raph Graybill, Gov. Steve Bullock’s chief of staff.

Livers, Graybill and Department of Health and Human Services Director Sheila Hogan and Operations Services Branch Manager Erica Johnston met with the news media Wednesday, saying they wanted to raise the issue before lawmakers traveled to Helena for Legislative Week next week.

The disagreement delaying the sale of the bonds means the state could pay additional interest charges and could see higher bids for projects as contractors fill their schedules. In a worst-case scenario could, the state could lose the 2020 construction season, Livers said.