Medicaid and Bob Marley Pharmaceuticals

I discovered this video yesterday via Breitbart TV, and it is both hilarious and disturbing.

While I am not a big proponent of misrepresentation by modern muckrakers, this “sting operation” is so ridiculous and over the top, I had to share it.

James O’Keefe and another member of Project Veritas posed as two Russian drug smugglers applying for Medicaid in Ohio.

The video shows Medicaid employees coaching “known” drug dealers on how they can maximize their chances of qualifying for the government program.

According to Commentary magazine, a 2009 GAO report “examined Medicaid pharmaceutical fraud in California, Illinois, New York, North Carolina, and Texas, and found that it cost taxpayers $63 million in those four states alone.”

At a time when our country’s leaders are struggling to find ways to increase revenue and reduce spending, this example provides yet another data point on how there is still plenty of wasteful spending ripe for cutting.

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About Sean Patrick Hazlett

Conservative clean energy crusader, national security hawk, financial analyst, engineer, and former military officer.
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12 Responses to Medicaid and Bob Marley Pharmaceuticals

  1. jlhartman says:

    Well I haven’t watched the video yet, but I disagree that “this example provides yet another data point on how there is still plenty of wasteful spending ripe for cutting.” The combined nominal GDP of the five states you mention is over $4 trillion. $63 million is 0.0016% of that number so, while it may be wasteful (again, I haven’t watched the video), it would be akin to someone making $100,000 worrying about wasting $1.58. Saving that $1.58 each year isn’t exactly going to put that person on the path to fiscal stability nor does it’s loss demonstrate that the person is a particularly wasteful spender.

    • But this is only one program among many in the Medicaid system, and Medicaid is only one program among many in government where there is a lot of fraud, waste and abuse. Plus, state GDP is a less relevant statistic than the total size of the Medicaid program in these states.

      Medicaid’s px drug program accounts for ~7% of its total budget, which was $319 billion in 2007, the year of the study. The five states in the study accounted for roughly 40% of the px drug program’s spending. So, a little less than 1% of that budget was wasted.

      If you further assume that about 0.7% is the normal rate of fraud throughout the entire government, you’d waste about $27 billion in FY11 based on a $3.8 trillion budget.

      And I would argue that 0.7% is lower than the real rate of waste – far lower.

      There are entire departments that probably should not exist…

      • jlhartman says:

        Well we’ve gotten a bit away from the argument, which was whether “this example provides yet another data point on how there is still plenty of wasteful spending ripe for cutting.” Even using your numbers and assuming 1% waste, I maintain that it does not. On the contrary, I would consider a 1% waste rate to be quite acceptable.

        Regrettably, you appear to be correct in assuming such a low rate is unrealistic, as the true rate of health care fraud in the US appears to be between 3% and 10%. The rate of waste would be even higher of course, as fraud is only one component of “waste”.

        However, that 10% rate of fraud in the health care field would have to double or triple to approach the estimated 21%-36% rate of fraud in the auto insurance business. So it doesn’t appear that the private sector is any better at eliminating waste than the government, even in such a highly competitive industry as auto insurance. Of course, auto insurance fraud could be easier to undertake, or there could be some other reason for the discrepancy I suppose.

  2. Love how we put jobs as a priority over the quality of the employee being hired and the quality of work that they do in this country. This is the kind of public employee we’re giving raises to? Amazing. I hope PV keeps pulling stings like this and exposes both the waste and stupidity.

  3. nickgb says:

    PV has been discredited over and over. They aren’t muckrakers, they’re propagandists. I’d like to say there’s the Michael Moore of the right, except I think that may even be an understatement.

    • Actually, “Michael Moore of the right” seems to me to be a pretty characterization.

    • So these people aren’t actually saying what they’re saying? Their words are being dubbed over by PV staff?

      I think more of the “discrediting” comes from the fact that government workers or those who receive federal funding (be it postal workers, ACORN workers, or Medicaid workers) hate being exposed as stupid, lazy, or worse so they fire back with the objection as to how unprofessional PV is or how they are supposedly “unfairly selective” in their targets. Is Moore any less selective?

      Sure, it’s “gotcha” tactics but who cares – it’s exposure of what the medicaid system wants hidden and anyone who’s operated on a business level with any government department would not be surprised by what they see in these videos.

      Any exposure into unscrupulous or lawlessness-supporting behaviors by a private company’s employees would be just as welcome by me, and there are tons of them out there already, so why does the left cry out when an O’Keefe exposes the other side? Because of poor “journalistic integrity”? Heaven forbid these expose’s go after the entitlement programs and the lazy and inept people they protect.

      • jlhartman says:

        I think the point is that it’s demagoguery. Videos like this misrepresent very real problems and issues. Health care reform is, quite literally, as serious as a heart attack and it will take honest, fact-based discussions to arrive at an (ahem) rational solution. Pursuing an agenda by dressing up and baiting befuddled paper pushers is unhelpful.

        • I have mixed feelings about it.

          I do not like the fact that these folks misrepresent themselves.

          On the other hand, it disturbs me that these folks will literally provide tax payer dollars to anyone with a pulse.

        • “I do not like the fact that these folks misrepresent themselves.”
          I think that’s trivial. We’re exposing fraud and waste. Who takes advantage of entitlement benefits BUT the creepy types of people that O’Keefe is portraying?

          If they were exposing everyday people getting denied benefits you’d use everyday people but in this case they were exposing how easy it is for those who should NOT be entitled to benefits to actually receive them. Worse, they’re being coached by the people responsible for screening and preventing abuse on how to actually rip off the system, just like the ACORN losers did.

          To show the extent of the abuse, they push the envelope on just what kind of an individual would qualify and how far those screeners would go to help them.

          The left continually dodges the point that these lazy, unscrupulous people – common to those types of positions – shouldn’t be working in these cushy government jobs. They also dodge the point of how easy it is for government waste to occur because these types of people are protected in these jobs.

          “Paper-pushers” they may be, but they’re often the only or the last human check-and-balance in the system before the client becomes a number. Their responsibility is more than simply that of a clerk, ESPECIALLY when they’re coaching and giving (illegal) advice. .

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