Audit rips All Kids health care, cites widespread abuse

Published: 5/11/2010 12:54 PM | Updated: 5/12/2010 8:24 AM

SPRINGFIELD - An audit of the All Kids health insurance program reveals state health care agencies have widespread problems managing millions of taxpayer dollars largely spent on benefits for undocumented immigrants.

Auditors found people getting benefits beyond age cut offs, no verification of whether enrolled children live in Illinois, conflicting policies on family income and misclassified immigrants, some of whom could be legal and eligible for federal health care dollars but instead are paid solely with state money.

The list of shortcomings unearthed in former Gov. Rod Blagojevich's vaunted health care plan goes on to include claims being covered even though families stopped paying premiums and a lack of documentation on a multimillion-dollar marketing campaign.

Told of the numerous findings, Itasca Republican state Sen. Carole Pankau was flabbergasted.

"Wow," said Pankau, who's routinely pushed legislation calling for greater accountability of the health care program. "It's sad."

Blagojevich's All Kids program took effect in July 2006, just in time for his re-election bid, and served to deflect attention from swirling ethical quandaries and federal investigations of his administration. It added children whose family income was twice the federal poverty level and all undocumented immigrant children.

A family of four making less than $29,328 annually can qualify for no-cost care. Premiums and co-pays begin and increase with family income, but a family of four with annual income as high as $176,413 can qualify for coverage. As of June 30, 2009, there were 71,665 children enrolled, 75 percent of which - 54,073 - were classified as undocumented immigrants, auditors found, though they cautioned mistakes in state All Kids data suggest the number is inflated. Of the nearly $79.1 million in claims paid under the program, nearly $55 million were for undocumented immigrants. The program took in just $8.9 million in premiums.

The numbers counter past claims by the state's main health care agency. In 2008, a spokeswoman for the Illinois Department of Healthcare and Family Services declined repeatedly to provide the Daily Herald with information regarding undocumented enrollees. Asked why, she said the issue was a "political football" and, "At the end of the day it's a minuscule number of participants that's undocumented."

The new head of the Illinois Department of Healthcare and Family Services agreed problems exist and would be fixed.

"I am committed to carefully reviewing the ways in which HFS can tighten up eligibility policy and procedures to assure accountability while at the same time assuring our beneficiaries are treated fairly and preserving our federal funding," Director Julie Hamos said in a letter.

Gov. Pat Quinn named Hamos to take over the agency last month. She replaced Barry Maram. A publicist for Blagojevich did not respond to a request for comment. The state's All Kids website now carries Quinn's name.

At times the audit encapsulated some of the broader, big picture criticism of state government and its lack of spending accountability. For instance, auditors requested 100 case files and in reviewing 98 of them could find no routine process used to verify All Kids enrollees lived in Illinois. Auditors said the other two case files were unavailable because the health care departments couldn't find one and the other was "inaccessible due to mold."

Auditors found one health care agency that, when calculating family income, included stepparent pay. But a different agency did not tally stepparent pay. As a result, those looking to enroll through the first agency were directed to the second for a better deal.