Louisiana Crackdown on Medicaid Fraud Paying Off (online only)
June 2010
By LA Attorney General's Office
Louisiana Department of
Health and Hospitals Secretary Alan Levine and Attorney General Buddy Caldwell recently
announced that Louisiana’s crackdown on Medicaid fraud is showing results for
taxpayers.
“When the Attorney General
and I took office two years ago, we agreed on a partnership to fight fraud and
abuse, and we wanted to see results,” said DHH Sec. Levine. “Medicaid fraud is
theft – from taxpayers and from those who rely on the program for their health
care. I’m proud of the results so far, and I commend the Attorney General, his
staff and the DHH staff who have answered our call to make this a priority.”
The results of the
combined efforts of the Attorney General’s office and DHH include:
* DHH increased identification of improper
payments by 222 percent since fiscal year 2005, and by 337 percent since fiscal
year 2007. Improper payments identified increased from $1.9 million in 2005 and
$1.4 million in 2007, to more than $6.2 million in fiscal year 2009.
* Of the improper payments identified,
DHH’s recovery rate increased from 84 percent in fiscal year 2005 and 73
percent in fiscal year 2006 to 93 percent in fiscal year 2009, with collections
increasing from $1.6 million in fiscal year 2005 to $5.85 million in fiscal
year 2009. The number of recoupments increased by 120 percent, from 234 in
fiscal year 2005 and 235 in fiscal year 2007 to 516 in fiscal year 2009.
* As a prevention measure against
prescription drug fraud and other types of enrollee fraud, DHH operates a
pharmacy and provider “lock-in” program, which requires suspected Medicaid
enrollees to utilize a single pharmacy or provider. The number of people in
this program has increased by 23 percent since fiscal year 2007 from 1,020 to
1,253 in fiscal year 2009.
* When DHH identifies possible fraud, it
refers cases to the Attorney General’s Medicaid Fraud Control Unit (MFCU) for
possible prosecution. The number of cases referred to the Attorney General
increased to 182 in fiscal year 2009 from 47 in fiscal year 2005 (a 287 percent
increase) and from 71 in fiscal year 2007 (a 156 percent increase).
* The Attorney General’s office increased
the number of prosecutions to 113 in fiscal year 2009 from 64 in fiscal year
2005 (a 77 percent increase) and 82 in fiscal year 2007 (a 38 percent
increase).
* The Attorney General is also increasing
the number of convictions from prosecuting these cases.In fiscal year 2009, the Attorney General won
56 convictions, up from 39 in fiscal year 2005 (a 44 percent increase) and 44
in fiscal year 2007 (a 27 percent increase).
* Total judgments from all sources obtained
by the Attorney General have increased to $19.8 million in fiscal year 2009, up
from $17.7 million in fiscal year ending 2005 (an increase of 12 percent), and
$9 million in fiscal year 2007 (an increase of 120 percent). In the current
year, the Attorney General has obtained $45.2 million in judgments, including
the successful multistate prosecution of large prescription drug manufacturers.
“It should be clear that
the Attorney General and DHH, together, are focused on finding people who try
to steal from the taxpayers, and are aggressively pursuing them,” said Attorney
General Caldwell. “I applaud this progress, and I join Secretary Levine in
stepping up our challenge to our agencies to continue working even harder to
root out fraud and abuse.”
Medicaid fraud is a major
problem facing the nation’s health care system. The Obama administration
acknowledged earlier this year that more than $55 billion of improper payments
was made in Medicaid and Medicare last year alone. Estimates of several
organizations, including Attorneys Generals, theGovernment Accountability Office and the FBI
have estimated that 10 percent of all Medicaid expenses are diverted through
fraud.
Secretary Levine pointed
out that one of the key contributors to fraud is the very design of the program
itself.Referring to the Medicaid
fee-for-service program as a “pay and chase system,” Levine highlighted that,
functionally, providers bill Medicaid and the state simply pays the bill. As
bills are received from providers, a payment is processed, usually within a
week. In the current fiscal year, the total of paid claims for Medicaid
services is $6.8 billion, spanning more than 18,982 participating agencies and
generating more than 60 million claims.
“We must change the design
of this system to get taxpayers off the hook,” said DHH Sec. Levine. “Right
now, the taxpayers shoulder all the risk for fraud. The bad guys can move
faster than the government bureaucracy can, and if all we are doing is paying
claims and asking questions later, than this effort simply becomes an exercise
in measuring how fast we can chase dollars that we may never recover.”
DHH has proposed a
transformation of the Medicaid system, moving from the fragmented, fraud-laden
fee-for-service system toward a coordinated care model where every enrollee
chooses a Medicaid provider network that is accountable for the funding,
clinical care and clinical outcomes for their consumers. Among the provisions
of this new model include mandatory fraud detection and reporting mechanism
that, for the first time, will engage provider partners in the fight against
fraud.
Anyone suspecting any
fraudulent activity by a Medicaid provider or recipient is urged to call DHH’s
Fraud Hotline at 1-800-488-2917.
The Louisiana Department
of Health and Hospitals strives to protect and promote health statewide and to
ensure access to medical, preventive and rehabilitative services for all state
citizens. To learn more about DHH, visit http://www.dhh.louisiana.gov.