Criminal Recoveries by Medicaid Fraud Control Units Nearly Doubled Amid Steady Fraud Convictions

According to the Medicaid Fraud Control Units (MFCU) Fiscal Year 2017 Annual Report issued recently by the Office of the Inspector General (OIG), convictions by MFCUs have held steady over the past three years. In FY2017, MFCU convictions totaled 1,528, including 1,157 convictions for fraud. Convictions for fraud were highest for personal care services attendants, nurses, home health agencies, family practice physicians, and mental health facilities. Criminal recoveries nearly doubled in 2017 to $693 million, the majority of which came from the Texas MFCU which prosecuted a large case involving a doctor and other codefendants who defrauded both Medicaid and Medicare by improperly recruiting individuals and falsifying medical documents. The number of civil settlements and judgements declined slightly in 2017 but were still higher than the average for the past five years. To access the report, click here.

Background on MFCUs

Medicaid Fraud Control Units (MFCUs) investigate and prosecute Medicaid provider fraud and patient abuse or neglect. The Social Security Act (SSA) requires each state to effectively operate a MFCH unless the state receives a waiver. Currently, 49 states and the District of Columbain operation MFCUs.

MFCU cases typically start with either a referral from an outside source or in response to internal data mining. MFCU staff review referrals and determines whether to investigate. Cases may result in various outcomes, such as convictions, civil settlements or judgements, and monetary recoveries.

The OIG may also exclude convicted individuals and entities from participated in federally funded health care programs based on convictions referred from MFCU. In FY2017, the OIG excluded 1,181 individuals and entities based upon conviction referrals from MFCUs. As described in the report, “Through these referrals, MFCUs help ensure that convicted individuals and entities are excluded from Medicaid programs in other States, as well as other Federal programs related to health care.”