New York and Louisiana crack down on Medicaid fraud

Oct 30 2009

The New York Times reports on unlikely Medicaid fraud suspects including a Manhattan painter and mime with properties in the Hamptons, a freelance artist whose two Manhattan apartments are valued at more than $1 million each and a dentist in the Bronx, all "were among 11 people indicted recently on charges that they fraudulently obtained Medicaid benefits. ... All were arraigned Thursday in State Supreme Court in Manhattan on various charges, including welfare fraud, grand larceny and filing false records. ... Prosecutors said that the defendants filled out applications to receive Medicaid, a health insurance plan for low-income people, and gave incorrect information about their income, assets and where they live. A person who qualifies for Medicaid must make less than $10,830 a year and have assets worth less than $13,800, prosecutors said. The threshold for couples with two children is $33,075 and $26,130, prosecutors said" (Eligon, 10/29).

Meanwhile, The Times Picayune reports on a new effort to fight Medicaid fraud announced in Louisiana: "More than 700 private firms that provide in-home care for the elderly and people with disabilities will face comprehensive audits in the coming months as part of a first-of-its-kind effort to root out fraud and abuse, state officials said Thursday. Companies suspected of overbilling Medicaid, or otherwise defrauding the program, will be referred to the state attorney general's office for prosecution, said Alan Levine, secretary of the state Department of Health and Hospitals."

This crackdown comes in the wake of years of "breakneck growth in home and community-based services as the state has tried to reduce its longtime reliance on nursing homes and other large institutions in caring for the elderly and disabled. From 2003 to 2009, the cost of the three major programs that provide home-care services in Medicaid grew by 174 percent, and they now cost Louisiana $673 million a year. ... Fred Duhy, director of the state's Medicaid Fraud Control Unit, said the rapid growth of the programs, combined with states having few resources available for oversight and fraud detection, have made them a magnet for unscrupulous operators. 'It's the fraud du jour,' Duhy said" (Moller, 10/29).