Block Says He Can Save RI $150 Million

Block Says He Can Save RI $150 Million

Rhode Island could cut an additional $75 million to $150 million in its budget by eliminating waste and fraud in Medicaid, according to former Moderate Party candidate for governor Ken Block.

In written testimony he is submitting this week to the House and Senate finance committees, Block volunteers his services to help the state root out waste and fraud. He says other states that have done so—like North Carolina and Florida—have cut their Medicaid budget by 10 to 20 percent. (Click here to read a recent report on the Florida program.)

Rhode Island spends roughly $1.5 billion on Medicaid, according to Block, meaning that the projected potential savings could reach $150 million to $300. But because roughly half of the money is federal, the actual savings for state dollars would come out to half that—$75 million to $150 million, Block says.

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(Block’s $1.5 billion figure is on the conservative end. Last month, the Center for Budget and Policy Priorities estimated that Medicaid spending in Rhode Island reached nearly $2 billion. For more, click here.)

Chafee: Open to Block’s ideas

In a statement, Governor Lincoln Chafee’s office said it is open to the idea.

Governor Chafee has stated repeatedly since introducing his budget last month that he welcomes any positive, constructive alternative suggestions on how to eliminate Rhode Island’s $295-million deficit and balance the budget,” said Chafee spokesman Christian Vareika. “As such, the Governor is certainly open to listening to Mr. Block’s ideas.”

Block stressed that until he gets access to the data, he can’t say for sure how much could be saved. One thing he is sure of—he says Chafee should not “resort” to taxes to balance the budget.

“I encourage Rhode Island’s leaders to balance our budget without resorting to the sales tax increases proposed by Governor Chafee,” Block told GoLocalProv. “There are a great many other avenues for balancing the budget that need to be quickly explored and put into play. If we cannot close a $200 million - $300 million dollar budget shortfall now without massive tax increases, what in the world will we do as the problem worsens in future years?”

Saved $1 billion in Texas

Block has drawn comparisons to work in Texas, which involved welfare, not Medicaid. During his campaign, he said that he helped design a new software system that streamlined the Food Stamp and Cash Assistance and eliminated waste and fraud—ultimately saving about $1 billion.

In the case of Medicaid in Rhode Island, Block says he can do most of the work himself—all he needs is an appropriate computer and database software from the state.

“The idea is to start with easy and quick waste and fraud screens like looking for monthly benefit payments going to deceased individuals,” Block said. “It will take time to perform more complicated investigations like looking for patterns of corporate fraud within the Medicaid program.”

Block says any savings he would find would be in addition to the $60 million in cuts Chafee hopes to realize in Health and Human Services by making those state programs more efficient and standardizing rates paid to various providers. The additional savings would still fall just short of the $176 million in new taxes Chafee is proposing.