by James C. Sherlock
Virginia is not doing enough to prevent Medicaid fraud. Our attempts are hampered by the dysfunctional design of the state regulatory system. They often fail because they cannot work. This piece will focus on behavioral health and recommend specific actions, but the entire healthcare regulatory system needs an overhaul. Absent that, we risk the stoppage of federal Medicaid contributions.
Ask Minnesota.
The costs of Medicaid Behavioral Health Services are immense, even in a single state. Last fiscal year, Virginia alone spent nearly $2 billion on services for mental health and substance use disorders out of $14.8 billion total Medicaid expenditures.
We note below from Medicaid and FAMIS Managed Care Healthcare Expenditures by Service Category that the fastest-growing Virginia Medicaid program is behavioral health services. It jumped from about $260 million to what appears to be $340 million per quarter over only six quarters.
We also note that expenditures on Home and Community-based Services jumped from $400 million to $525 million per quarter over the same 18-month period. Payments to Lucas Lodge and more than a thousand other providers of community-based services for the intellectually and developmentally disabled (I/DD) services are included in that number.
Autism diagnosis and treatment are included in both figures.
The National Institutes of Health reports that autism misdiagnosis or late diagnosis is highly common, but is often sought partially because an autism diagnosis “is validating.”
Because autism relies on behavioral observation rather than lab tests, traits are frequently masked to fit in or confused with other conditions like ADHD, social anxiety, or bipolar disorder. This can lead to years of inappropriate treatment and immense stress.
Autism diagnosis and treatment are a growth industry, and the Medicaid money thrown at the problem is staggering. So, oversight to prevent fraud committed by companies, often owned by private equity firms, and by individual providers, is crucial.
Virginia apparently does not yet see it that way. The feds do.
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