The District probably never will recover the money lost - perhaps $80 million - because ineligible people were kept on the Medicaid rolls for four years, a city official said yesterday.
"How can we now go back and take away money from [health care organizations] that in good faith provided health services" to more than 20,000 people, said Paul Offner, the city's commissioner of health care finance.
City officials said Wednesday that, since 1992, they had been paying $15 million to $20 million yearly in health care costs for people who no longer were eligible for assistance. In April, the city kicked more than 20,000 people, around 15 percent of its caseload, off the Medicaid rolls, Mr. Offner said.
"The loss of that kind of money for us is a major factor. It's a major loss," said D.C. Council member Jack Evans, Ward 2 Democrat.
The news of overspending on Medicaid comes at a tough time for the city, which is in a budget crisis that has left many agencies nearly unable to function. In May, Chief Financial Officer Anthony Williams warned that the city faces a $116 million deficit next year and has little immediate hope of repaying $300 million from past deficits.
Earlier this month - citing ineffective management - the D.C. financial control board forced out Vernon Hawkins, head of the city's Department of Human Services, which controls Medicaid payments.
Mayor Marion Barry has long complained that the District is saddled with responsibilities - including Medicaid payments - that are far beyond its ability to afford. In most areas, such responsibilities are handled by county or state authorities, not by cities.
It's unlikely that the ineligible people who received Medicaid services will repay the city, Mr. Offner said. Many of the ineligible people remain too poor to be worth suing, he said.
"If you win, you put them …