The Same Medicaid Patient. Two States. Two Checks. $4.3 Billion.

Move to a New State. Keep Your Old Medicaid. Collect Both.

Medicaid is administered state by state. When a beneficiary moves from one state to another, they’re supposed to dis-enroll in the old state and enroll in the new one. In theory. In practice, the federal database that lets states cross-check enrollments is not mandatory to use, not always up to date, and states have no automatic disenrollment trigger when a new enrollment is detected elsewhere.

The result: 327,497 Medicaid beneficiaries were simultaneously enrolled in two different states as of August 2020, according to HHS OIG Audit A-05-20-00025. Both states were billing the federal government for managed care capitation payments — monthly fixed payments to insurers for covering the beneficiary — at the same time. For the same person. Who was physically living in one place.

HHS Auditors Found 47 States Doing This. CMS Disagreed With the Fix.

HHS OIG published Audit A-05-20-00025 in September 2022. The finding: 47 of the states reviewed had made capitation payments for beneficiaries who were concurrently enrolled in Medicaid in another state. The auditors recommended that CMS require states to use the federal enrollment database to cross-check before making payments and implement automatic recoupment procedures for duplicate payments already made.

CMS did not concur with the recommendations. The agency’s position: implementing the recommended cross-check requirement would place an undue burden on state Medicaid agencies. The OIG noted the disagreement and left its findings on the record. No mandatory cross-check has been implemented.

“47 states made capitation payments for Medicaid beneficiaries who were concurrently enrolled in another state's Medicaid program. CMS did not concur with our recommendations.”

HHS OIG Audit Report A-05-20-00025 — September 2022

$800M in 2019. $2.1B in 2021. The Problem Is Getting Worse.

The duplicate enrollment problem is not static. The annual cost grew from $800 million in 2019 to $1.3 billion in 2020 to $2.1 billion in 2021 — a 163% increase over three years. The pandemic-era Medicaid continuous enrollment requirement, which prevented states from disenrolling beneficiaries for any reason during the public health emergency, contributed to the growth. States could not remove people even when they knew they had moved.

The Consolidated Appropriations Act of 2023 ended continuous enrollment and required states to conduct eligibility redeterminations. States disenrolled millions of beneficiaries during the 2023–2024 “unwinding” period. Whether duplicate multi-state enrollments were caught and corrected during that process has not been separately audited.

States Have No Incentive to Fix It. The Federal Government Pays.

The structural problem is a classic fiscal federalism failure: states administer Medicaid, but the federal government funds most of it through the Federal Medical Assistance Percentage (FMAP). A state that lets duplicate enrollments persist does not pay the full cost — the federal government does. The state’s administrative burden to fix the problem falls on state staff; the financial benefit of fixing it flows mostly to federal taxpayers. The incentive math does not work.