Medicaid fraud dog whistle a familiar tune in Mississippi

On Feb. 5, 2020, six people, including former Mississippi Department of Human Services Director John Davis, were arrested in connection with a massive alleged public embezzlement scheme in Mississippi. The half dozen people arrested, which includes those who worked for the state and others, are accused of taking more than $4 million in public funds from the Temporary Assistance for Needy Families (TANF) program – dollars intended to help Mississippi children and families.

In the wake of these arrests, rather than focus on the state’s persistent failure to allocate available TANF dollars to qualified families and other reforms, elected leaders targeted low-income families. Mississippi Auditor Shad White successfully urged the Legislature to pass SB 2257, a bill authorizing the auditor to examine the state tax returns of recipients of public benefits such as Medicaid, TANF and the Supplemental Nutrition Assistance Program.

Given Mississippi’s track record of using any excuse as a pretense to hammer low-income people, White’s latest audit of federal money has set off alarms among advocates. Using the new authority granted to his office under SB 2257, the auditor compared the income that Medicaid recipients reported to the program with the income the recipients reported on their state income tax returns to conclude that 5% of Mississippi’s Medicaid recipients were ineligible due to high income.

This calculation is problematic for multiple reasons.

First, Medicaid eligibility is based on current monthly income or future earnings. That means someone eligible now might have been ineligible before or after eligibility. But since eligibility is determined on an annual basis, it can take time for people to lose their eligibility. This isn’t “fraud.” It’s just the way the system works.

Second, the Mississippi Division of Medicaid’s current eligibility verification plan, which was approved by the Centers for Medicare & Medicaid Services, states that tax returns are not a reliable data source for determining eligibility. Income can vary dramatically over the course of a year and tax returns do not provide a month-by-month income breakdown. For this reason, tax returns represent some of the least credible data for determining a person’s monthly income. Comparing tax records to applications simply provides an overview of annual income from the prior year – not a snapshot of current earnings.

It’s apparent that the auditor is aware of the limitations of solely using tax returns as a basis for determining Medicaid eligibility. The audit acknowledges several times that it cannot determine whether the people it singles out were, in fact, ineligible. Despite a lack of clarity, White charged ahead with an audit that treats recipients as ineligible and calculates a worst-case scenario analysis that is meant to get the public hyperventilating about a problem that doesn’t exist. In other words, he’s resorting to what is becoming a well-worn tradition of his office – sounding the dog whistle of welfare fraud.

If history is any guide, White will return to the Legislature in 2022 waving his latest audit as an indication that Mississippi needs to make it even harder for people to access necessary support. That would be a disaster. The income of people fluctuates and it’s not surprising that in the middle of a pandemic, some people who were doing well before have now hit hard times. Medicaid and other public assistance programs have been lifesavers for many people in Mississippi.

Over the coming months, the SPLC Action Fund will work with local partners to ensure that Mississippi doesn’t add needless red tape to its Medicaid application process and will instead urge the Legislature to expand and strengthen Medicaid and other vital programs. 

We are fortunate that there’s not a bill currently in the Legislature targeting Medicaid recipients for harm. However, Mississippi residents can do their part by remaining vigilant for attempts by officials to use misleading information to shred the social safety net at this critical time.

Brandon Jones is policy director in Mississippi for the SPLC Action Fund.

Photo at top: Mississippi State Auditor Shad White speaks at a press conference in the Walter Sillers Building in downtown Jackson regarding the latest report by his office on Monday, May 4, 2020, detailing inappropriate and questionable federal welfare money spending in Mississippi. (Credit: Sarah Warnock/Clarion Ledger, Mississippi Clarion Ledger via Imagn Content Services, LLC)