Software Glitch Costs California Prisons Millions in Lost Medicare Money


The Los Angeles Times reports that California’s court-run prison healthcare program is missing out on tens of millions of dollars a year in federal funds because of disagreement with counties and software problems, a new legislative report states. The legislative analyst’s office found increasing numbers of prison inmates who, because of their low income status, are eligible for the state’s Medicaid program. That program, delivered through counties, draws matching federal reimbursements. The LAO notes that federal policy has allowed states to collect federal Medicaid reimbursement for eligible state prison inmates since 1997.

The agency states that California has only recently developed a process to obtain this funding, and is not yet seeking the full amount possible. The LAO report, released Tuesday, notes that the court-appointed prison healthcare receiver has agreements with 12 counties, covering nearly three-fourths of the inmates in the state prison system, and the state pays those counties a $10 administrative fee per covered inmate. However, other counties have not signed agreements, including a consortium of 35 rural counties that have balked at the amount of overhead funding the state offers.

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