Medicaid billing error cost Colorado tens of millions, officials acknowledge

By Cory Gaines | Commentary, Colorado Accountability Project

HCPF really did accidentally pay millions in Medicaid claims.

In an earlier op ed about Colorado’s Medicaid expansion (see the first link below) and how that puts our state at higher risk of fraud, waste, and/or abuse, I asked the Colorado Division of Healthcare Policy and Financing, HCPF, the state unit which adminsiters Medicaid, about what they do to prevent or stop such problems.

Their spokesperson responded with:

“We constantly look out for fraud, waste and abuse (FWA) across all services & programs, but some programs or services are more susceptible to FWA than others. We have various processes/procedures in place for ‘high risk’ services to prevent inappropriate payments from going out the door. Those preventive measures often include, but are not limited to, ‘prior authorization requests’ (PARs) to ensure the service being requested meets ‘medically necessary’ clinical criteria before the service is authorized. We also conduct pre- and post-payment reviews of claims to ensure/confirm the payments being made are or were appropriate. If something appears questionable or inappropriate, we launch a deeper investigation to determine if we need to recoup inappropriate payments. If we believe billing activity might be fraudulent, we refer those cases to the Attorney General’s office for further investigation and potential criminal prosecution.”

Good words. Brave words. Just exactly what you’d expect.

Thing is, per the CPR article linked second below (which is itself a review of an earlier Denver Post expose), they goofed.

Oops!

Quoting the article with link intact:

“The state’s Medicaid program mistakenly paid contracted providers, which transport patients who use larger wheelchairs, several times more than was required. The Denver Post first reported the discrepancy. The correction is projected to save the state almost $33 million through the end of this fiscal year and $60.4 million next fiscal year, including state and federal funding.”

I’ve been lighthearted in tone about this up to now, but this mistake has some serious consequences. The CPR article, in fact, profiles a mom with a special needs child who might face cuts to her child’s care because our state can’t make Medicaid sustainable. Gigantic overpayments which have apparently gone on for some time now are one of the reasons why.

It’s not even fraud either; from what I can see in the article, it was a simple typo in a payment code.

Bad intent, bad actors, are not necessary to have money going where it shouldn’t. Mistakes, lack of oversight, and fraud scale with the size of the system and our state has decided (going all the way back to 2014) to balloon it up and pay for things like housing, nutrition services, even (as I wrote in an even earlier newsletter) therapy involving horseys.

Now we end up in a situation where the poor management of the system will hurt people because they spent us into a problem. Perhaps a better approach would have been to have kept the Medicaid program smaller and more manageable.

That wouldn’t guarantee problems like this wouldn’t happen, but if they did, I bet they’d be smaller.

I bet any issue that did come up would have less impact on a system not wheezing and rocking back and forth on the couch trying to stand up under too much excess flab.

Remember folks, elections have consequences. This is not a Federal problem. This problem didn’t have to happen.

This was a problem created by those running the state.

https://completecolorado.com/2025/12/12/minnesotas-medicaid-fraud-warning-for-colorado/

https://www.cpr.org/2026/01/29/medicaid-overbilling-colorado/

READ THE FULL COMMENTARY AT THE COLORADO ACCOUNTABILITY PROJECT

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