• Day Three: TechLeader.TV’s “Top Actions” to Cut California Government Waste and Boost Efficiency

    March 1st, 2011 by admin Categories: Blogs Tags: , , , , , ,

    Here’s TechLeader.TV’s Contribution – $5 billion Deficit Reduction

    DAY ONE: February 25, 2011

    Eliminate $1.8 billion Financial Information System for California (FI$Cal) Project  – Savings: $1.7 billion

    DAY TWO: February 28, 2011

    Terminate California Court Case Management System (CCMS) Immediately – Savings: $1.5 billion

    DAY Three: March 1, 2011

    Intensify Fraud and Waste investigations of Medical and other state benefit and revenue programs – Savings: $1 billion

    Discussion: Federal payments made to the wrong person, at the wrong time, or in the wrong amount, last year totaled approximately $110 billion. Federal agencies paid more than $1 billion to dead people, according Sen. Tom Coburn (R-Okla.). President Obama has set an aggressive goal to eliminate $50 billion in improper payments between 2010 and the end of FY 2012.

    Each of these headlines involved programs which are administered and half funded by the states, and of course the biggest chunk is California’s.

    Ironically, a program championed by the new governor-elect as Attorney General could be a model for an expanded, state-wide effort potentially recouping billions. The AG investigates problems in the state’s $40 billion Medical program whose state share is nearly one-quarter of the state’s entire budget. The AG’s Bureau of Medi-Cal Fraud recovered nearly a quarter billion dollars last year, a 400% increase since Brown took over in 2007. However, this may be only the tip of the iceberg. Almost 10 years ago, the U.S. Government Accountability Office estimated that California Medicaid fraud was over $1 billion a year. Malcolm Sparrow of Harvard University, a top specialist in health care fraud, in testimony before the U.S. Senate Judiciary Committee last year stated that fraud and abuse could be 10%, or 20% or even 30%! By expanding the utilization of new technology based business intelligence analytics, improper payments can be substantially eliminated.

    Other areas are ripe for such aggressive, technology based investigation. Unpaid California state taxes are nearly $7 billion a year, with a cumulative total of over $100 billion. Similar error rates apply to other state programs across the board. It is time to get serious about ending this profligacy.

    Some of these ideas are not new. Some were identified during Governor Schwarzenegger’s ill-fated California Performance Review (CPR), which critics labeled “exaggerated” and “half-baked”. But as I have paraphrased Chesterton before, CPR was not tried and found wanting; it was considered, deemed difficult, and abandoned.

    1. Will Young says:

      Great job in only 3 days! Day 1 and 2?… Very Nice! But day 3?… I have to comment because I did the math. 10% bad payments (fraud) of a $40 Billion program means we are potentially losing $4 Billion per year through various holes in the floor. DOJ has increased their recovery efforts by 400% and recovered over $250 Million of that. Clearly, DOJ has been doing an increasingly effective job recovering bad payments – so, many kudos to the Bureau of Medi-Cal Fraud and Elder Abuse! However, according to my math we still have $3.75 Billion falling through the holes in the floor. And it seems that once the money has fallen through the holes, it becomes increasingly more difficult to “recover”. Now if we can just find the will and the resources to put this kind of effort towards “prevention”, we may be able to plug some of those holes and stop the bad payments in the first place.

    2. […] Already doing it and new system would be too costly. Typical alibis. GAO and others say medicaid 10-20%, even 30% fraud, but folks like Ott refuse to remove the blinders. Is California doing any different? See here. […]

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