Barry against Pursuing $34 Million Misspent: Medicaid Can Be Recovered, Aide Insists

By Morris, Vincent S. | The Washington Times (Washington, DC), January 24, 1997 | Go to article overview

Barry against Pursuing $34 Million Misspent: Medicaid Can Be Recovered, Aide Insists


Morris, Vincent S., The Washington Times (Washington, DC)


Mayor Marion Barry says the District should not attempt to recover $34 million in misspent Medicaid dollars, even though the city is millions of dollars in debt.

Mr. Barry said the city would not be able to get any taxpayer money back from First Health Services Corp. in Richmond because states with similar disputes involving First Health tried and failed to recover lost money.

"Others have tried, and didn't get nowhere," said Mr. Barry during an interview yesterday. "To go back and do all of this wouldn't be worth the money."

But D.C. Inspector General Angela L. Avant, who was hired by Mr. Barry, disagrees with him.

"It doesn't make any sense to me not to go after First Health. They have clearly not lived up to their end of the deal," she said yesterday.

Miss Avant, who recently finished a six-month investigation of First Health and its exclusive contract with the city, released an audit this week that concludes the city should seek $34.7 million in overpayments made to the company between 1993 and 1996, The Washington Times reported yesterday.

The overpayments, she said, are the result of an apparently simple mistake: The computer used by First Health failed to make changes in the system when people became ineligible for the Medicaid program. When the city learned of the problem last year, 20,000 people were dropped from the rolls, and the computer problem has since been corrected.

First Health, which has had a contract with the District since 1980, operates a computer system that tracks, processes and adjudicates Medicaid claims.

Several D.C. Council members said the city should aggressively pursue legal action against First Health, because other states have successfully sued the company.

"I would want the city to aggressively pursue trying to recover the money," said council member Jack Evans, Ward 2 Democrat. "I'm trying to give the mayor the benefit of the doubt on this, but I don't understand him."

Council member Charlene Drew Jarvis, Ward 4 Democrat and acting council chairman, was more blunt: "Of course we should go after that money. …

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