In a decision that will affect nearly one of every four persons in the city, the D.C. department of human resources has added a new layer of paper to the eligibility requirement for an estimated 170,000 D.C. residents who receive medical care through the federal Medicaid program.

Beginning May 1, an embossed plastic Medicaid card will not be enough to get treatment through the program. Instead, acting DHR director Albert P. Russo announced last week, Medicaid recipients will also have to show red, white and green eligibility cards. The new paper cards will be good for only one month at a time.

The new system may double the $300,000-a-year mailing bill of the city's $100-million-a-year Medicaid program, which is reported to be one of the most expensive in the nation for local taxpayers.

However, Russo said the new system will permit DHR "to get a tighter control on the management of the Medicaid program" and could help stem loses because of alleged Medicaid fraud.

Some news reports have estimated that the city loses between $200,000 and $300,000 each year through Medicaid fraud. DHR says the lossess are less. Implementing the new card system could cost $300,000 more a year for the extra mailing costs, the department estimates.

Some Medicaid activists are expected to oppose the new plan. Herbert Semmel, a lawyer who has represented Medicaid recipients in past legal chalenges to DHR policies, said the new plan may only multiply the errors of the present system.

"For people who are eligible and then are erronously declared ineligible one month, it's disastrous," Semmel said.

he problem is all the errors that will inevitably take place and people will without medical care while they straighten out the errors."

Semmel said the loss could be particularly great among low-income residents who move frequently and to not have their mail forwarded. "Somebody moves and suddenly doesn't get the card, then they'd ineligible.

The montly card system could be the first step toward a comprehensive program to crack down on alleged Medicaid abuse. DHR is also studying the possibility of putting photographs on the embossed cards.

City Council member polly Shacketon (D-three), who is chairman of the Council's Committee on Human Resources and Aging, thinks the monthly card system should be given a try.

"I think it's a good idea because I know there's been a tremendous amount of abuses," Shackleton said. "There have been actual cases where people have moved out of the city to Prince George's County, kept their Medicaid cards and kept using them."

The new monthly system will also apply to about 15,00 people who receive medical care under the D.C. medical charities program, which provides free health service to low-income persons who do not otherwise qualify for Medicaid.

Under the old system, plastic Medicaid eligibility cards good for six months to a year were issued to people qualifying for the federal program, which provides medical care for the indigent.

Russo said that system allowed persons whose eligibility had expired months earlier to still receive free treatment. Some medical practicioners became wary of treating Medicaid patients, he said, for fear that the cards would not be bona fide.

Under the old system, Russo added, it was harder to keep up with current addresses for the service recipients. The new plan will improve that, Russo said, and will keep the cards out of the hands of ineligible persons.

Medicaid recipients will not have to be re-verified every month, Russo said. Instead, the card will be mailed out regularly in the same way that the department now sendsout cards authorizing the purchase of food stamps.