Medicaid Audit Reveals Overspending

Jan 31, 2013

Beth A. Wood, State Auditor

A state audit of North Carolina's Medicaid system has found that it spends much more on administration costs than other states of a similar size. State auditor Beth Wood says the seventy-page audit of the Department of Health and Human Services details how the state has overspent its Medicaid budget by more than 1.4 billion dollars. 

"First, our work found that the administrative spending for the state's Medicaid program is 38 percent higher than the average of nine states with similarly sized Medicaid programs," she said. "While those states on average have administrative costs of about 4.5 percent, the state of North Carolina is spending over six percent of its total budget on administrative cost."

Wood says some administrative costs were high because they were tied to contracts that were not properly monitored. The state and federal governments share the cost of Medicaid, which is the health insurance program for low-income and disabled people.