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Most of the taxes used to launch and implement the country’s only Medicaid labor requirements program are moving towards paying administrative costs rather than covering Georgian healthcare, a new report from the Government’s Accountability Office, a nonpartisan agency that monitors federal programs and spending.
The government report considered the cost of managing Georgia’s routes. This is an experiment on state work requirements. Following previous reports by current and Propublica, the program shows federal and state taxpayers cost more than $86.9 million.
GAO analysis, including all route management costs detailed in the report, shows that as of April, the Georgia program spent $54.2 million on administrative expenses since 2021, compared to $26.1 million on healthcare expenses. The report concluded that almost 90% of administrative spending came from the federal budget. This means that Georgia’s experiments are funded by taxpayers across the country. Federal spending could increase given that the Centers for Medicare and Medicaid Services approved an additional $6 million at administrative costs not reflected in the report as it was made public before the state filed the bill.
The Expense Watchdog Agency repeated its 2019 criticism of the Centers for Medicare and Medicaid Services for lack of oversight of administrative costs associated with state initiatives approved in the name of Medicaid reform.
The September GAO report said the Medicaid agency never asked Georgia to detail the costs of building and implementing the program. The federal approval process for states that want to experiment with the Medicaid system “doesn’t take into account the extent to which demonstrations increase management costs,” the report says.
Republican Georgia Gov. Brian Kemp has promoted the country as an example of how fellow conservatives across the country review the interests of the federal safety net and rely on critics riding as handouts to low-income Americans. Congressional Republicans cited the route as a model for the federal Medicaid Work Requirements Act, passed in July, which took effect in 2027. The Georgia Route Program was scheduled to expire on October 1, but the state requested that the experiment be extended for another five years.
The Georgia program was to expand free health care to groups that the state previously deemed unqualified for Medicaid: fewer adults under the age of 65 than the federal poverty line, which is $15,650 a year. To qualify, Georgians had to prove they worked, studied, and volunteered at least 80 hours a month.
However, registrations for Georgia routes remain low. The latest state data shows that 9,175 of the approximately 5 million low-income Georgians eligible for the program are registered as of August 31. Previous reports from current and publicity revealed that they were due to glitches in the digital platforms people have to use to register.
Georgia officials previously told current and in their affidavits that the route was not designed to maximize registration. Kemp spokesman Carter Chapman said Monday that the Kemp administration is still committed to pathways and refinement to meeting Georgian healthcare needs.
In December, Democrat senators critical of Medicaid labor requirements, including Georgia’s John Ossoff and Rafael Warnock, asked GAO to report the route implementation and administrative fees to ensure that recipients are working, studying or volunteering.
“Management spending outweighs spending on medical assistance (such as health services)” for Georgia’s routes, the report states. “This could be driven by changes in advance management required to implement the demonstration, delayed start dates for registration, and duplication of management spending due to delays.”
Georgia officials told GAO that two-year delays caused by a legal battle with the Biden administration have increased management costs associated with the route by 20% to 30%. The report provided no evidence to support the state’s claims.
“This report was requested by the same individuals who have no new or good ideas to address Georgia’s medical needs,” Chapman said in a statement. “Now, as other states are ready to adopt our model and reject large government healthcare that doesn’t fit one size, Democrats like Senator Ossov and Warnock are trying to rewrite history after four years of omission and blame the state for the costs associated with their own stonework.”
Warnock said the GAO findings strengthen his opposition to the Trump administration’s push for nationalising labor requirements due to the amount of taxes on non-healthcare costs.
“Now, the whole country can see what we already know in Georgia. Georgia’s Medicaid work reporting requirements are true waste, fraud and abuse,” Warnock said in a statement. “This report shows that the routes are extremely effective in enriching corporate consultants, except for workers from health insurance.”
Congress is pushing for Medicaid work requirements. Here’s what happened when Georgia tried it:
Ossov wrote about Georgia’s routes: “While we waste tens of millions on expensive consultants, Georgian hospitals struggle and Georgians get sick without health insurance.”
The GAO report does not include the $27 million Deloitte Consulting has acquired in the market path, or roughly $10 million directed towards additional consulting by other companies, and legal costs associated with the two-year court battle with the Biden administration.
Deloitte did not respond to requests for comment. The company previously refused to answer questions about Georgia’s route work and referenced requests for information from the state’s Community Health Department. The agency did not respond to requests for comment, but previously described Deloitte’s marketing and outreach work as “robust” and “comprehensive.”
