Calif. Top State in Recouping Funds From Medicaid Fraud

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In fiscal year 2011, California recovered $388.26 million through Medicaid fraud and patient abuse investigations, as well as civil and criminal cases, according to a report from HHS Office of the Inspector General, FierceHealthcare reports.

The amount is the most recovered by any state that year.

National Findings

In total, states recovered $1.7 billion through Medicaid fraud and patient abuse cases in FY 2011.

Federal and state governments in FY 2011 spent $208.6 million on Medicaid Fraud Control Units, which investigate and prosecute fraud, patient abuse and neglect at health care organizations.

MFCUs in FY 2011 conducted 10,685 Medicaid fraud investigations -- which yielded 824 convictions -- and 4,134 investigations into suspected patient abuse and neglect, which yielded 406 convictions (Cheung, FierceHealthcare, 4/3).

Overall, federal and state governments recouped $8.39 for every dollar spent on the MFCUs, the report found (HHS OIG report summary, 4/3).

Top States for Recovering Medicaid Fraud

The states that recovered the most Medicaid fraud in FY 2011 were:

  • California ($388.26 million);
  • Texas ($190.87 million);
  • New York ($136.44 million);
  • Ohio ($82.48 million); and
  • Kentucky ($81.44 million) (FierceHealthcare, 4/3).
Barbara Hanson
From Nancy Weaver Teichert: "Seniors' State Funding is Focus: The Wealthy Are Allowed to Meet Medi-Cal Rules to Pay Nursing Home Bills, A Study Says," in the October 2, 2004 Sacramento Bee: "California is hemorrhaging millions by allowing well-off seniors to get on Medi-Cal to pay for nursing homes, contributing to poor care . . ."The result is a 'welfare-based' nursing home industry where the state pays less than actual costs to homes faced with rising operating expenses, the study said. "'You basically get what you pay for and the government isn't paying enough to ensure access to quality care,' said Stephen Moses, author of 'The Realist's Guide to Medicaid and Long-Term Care.' "The state needs to tighten its eligibility rules. The Medi-Cal system, the state's health insurance program for the poor, should be a safety net, not 'inheritance insurance for the baby-boom generation,' said Moses. 2012-same story. google medi-cal planning. Ignore the risk until it happens-go see a l
William Viergever
FYI-the bulk of this (about $301M) came from a false claims suit i did all the computer modeling & processing on from late 2008 through May 2011 ... in fact a week or so ago, the two Deputy AG's along w/ plaintiff's counsel won CLAY Awards for this ... google "Harris Announces Settlement with Quest Diagnostics" (link below) and "Harris Announces Settlement with Labcorp"...and you are correct, this most likely is occurring w/ other provider types than just clinical labs
Robert Forster
Corey, I agree with you given the program's little if any controls on providers (physicians and others) and no network management or selectivity--essentially any provider can participate. Also, given HSS long awaited analytics and predictive modeling that are still in concept stage. However, you must give credit where do, and California has about 10% of the nation's Medicaid recipients yet recovered nearly 25% of the total fraud bucket dollars. Thus measuring Ca's performance against other states shows it is leading the pack on recoveries, but we don't really know the potential recovery number. But fraud is easy in both Medicaid and Medicare--easier than running drugs. Rob MD
Corey Shank
It's obvious because Medi-Cal is both so big and set up so poorly, it is ripe with fraud...from almost every possible source. Applicants, doctors, support organizations, etc.

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