Maine group asks state to tighten Medicaid oversight

(The Center Square) — Maine is being pressured to ramp up oversight of its Medicaid programs amid increasing federal scrutiny of alleged fraud and wasteful spending.  

On Tuesday, the group Lead Maine delivered more than 3,000 certified voter signatures to the state Department of Health and Human Services, petitioning the agency to adopt two new rules tightening oversight of MaineCare spending. 

Under Maine law, a petition to adopt a rule signed by 150 or more registered Maine voters requires the agency to initiate rulemaking within 60 days. 

Lead Maine collected more than ten times that threshold on each petition, "leaving DHHS a clear legal obligation to act," the group said.

“Maine spends more than a billion dollars a year on MaineCare. Every one of those dollars belongs to a taxpayer, and every one is supposed to reach a vulnerable Mainer who needs care," Rep. Laurel Libby, an Auburn Republican and the group's founder and executive director, said in a statement. "More than 1,500 Mainers signed on to each of these common sense ideas." 

One petition submitted by the group on Tuesday calls for expanding on-site inspections of facilities that receive Medicaid funding by closing what the group called a "loophole" in the law that lets state auditors count a phone call or paperwork review from their office as an “on-site” inspection of a MaineCare provider. 

The rule would require on-site physical inspections of the facilities and make providers who refuse subject to sanctions. 

Another petition would allow for the suspension of Medicaid payments to a provider if they receive a notice of improper payment totaling $1,000 or more, according to the group.

"If the state says it inspected a provider, an inspector should have actually been there," Libby said. "And if the state catches a provider billing for money it wasn’t owed, it should stop writing checks until the matter is settled." 

A spokesperson for the Maine Department of Health and Human Services said the agency has received the group's petitions and will review them but defended its anti-fraud protections. 

"The Department remains committed to protecting the integrity of the MaineCare program, responsibly stewarding state and federal resources, and preserving access to care for the Maine people who rely on MaineCare," the agency said in a statement. "Under Governor Mills, Maine has taken significant actions in recent years to increase oversight and scrutiny of Medicaid providers, including proposing legislation to require licensing standards on several providers for the first time ever." 

The group's demands come as the Trump administration is threatening a federal takeover if state leaders don't turn over details of state Medicaid payments for an investigation of potential fraud in the program.

A January report by the U.S. Department of Health and Human Services Office of Inspector General flagged nearly 100 Medicaid payments for autistic rehabilitative and community support services that did not comply with federal and state requirements. The watchdog directed the state to repay at least $28.7 million for the federal share of the payments.

Medicaid is jointly funded by states and the federal government. In Maine, the federal government covers most of MaineCare's $5.4 billion in annual spending, with the state contributing about $1.5 billion, according to federal data.

Democratic Gov. Janet Mills has pushed back on the claims, referring to CMS Director Mehmet Oz as a "former TV doctor" and accusing the Trump administration of using the allegations of fraud to "punish" Democratic-led states. She notes that MaineCare's improper payment error rate is 2.4%, which is less than half the national average. 

Vice President JD Vance accused "illegal aliens" of stealing millions of dollars in federal funding from Maine taxpayers during a visit to the state in May, where he announced that the Trump administration is freezing new Medicare enrollments for hospice and home health agencies for the next six months for all states, including Maine.

Vance said the move is aimed at protecting people who depend on Medicare and taxpayers.