A small part of state and local budgets just 10 years ago, the cost of In-Home Supportive Services has ballooned in recent years. The Legislative Analyst's Office estimates that IHSS will cost the state $1.5 billion this fiscal year, close to triple what it cost a decade ago. By 2014-15, costs are projected to rise to $2.3 billion.
Not surprisingly, economically struggling state and county governments are scrambling to reduce costs. That includes more focus on fraud. The Legislature has allocated $36 million to pay for increased IHSS fraud investigations, and to provide training, fingerprinting and paperwork for caregivers and recipients.
The administration predicts anti-fraud efforts will save $160 million this fiscal year, while the LAO places the savings at $40 million. In either case, better anti-fraud efforts are warranted.
IHSS has worked pretty much on an honor system in the past. Up until this year some fraud had been easy to detect and control, as when a recipient dies or is hospitalized and the caregiver continues to receive payments.
But no one should kid themselves. In a program such as IHSS, where 62% of caregivers are relatives and 48% live in the same house as the disabled person who employs them, fraud is difficult to detect. Everyone has an incentive to exaggerate the level of disabilities because it increases the household's income.
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