Medicaid Fraud Control Units Recovered $1.8 Billion in 2016

The Office of Inspector General (OIG) has released national and state-by-state data of investigations, convictions, settlements, and recoveries of Medicaid fraud by Medicaid Fraud Control Units (MFCUs) in 2016.  Medicaid Fraud Control Units operate in 49 states (all but North Dakota) and the District of Columbia, and are typically part of the state attorney general's office.

In 2016, MFCUs were credited with 1,564 convictions (1,160 involving fraud and 404 involving abuse or neglect), 998 civil settlements and judgments, and $1.88 billion in recoveries ($368 million of which were criminal recoveries).  MFCU civil settlements in 2016 represented a more than twenty four percent increase from the number of civil settlements in 2015 (731).

“… [W]hile we hear a lot about Medicare Fraud, involving the program for the elderly and the disabled, total taxpayer costs are actually higher in Medicaid, than in Medicare, with total yearly expenditures for Medicaid of over $500 billion dollars,” said Richard Stern, OIG Director of Program Oversight for Medicaid Fraud Units, in a recent podcast.

According to the newly released data, at the end of fiscal year 2016, there were a total of 18,730 open MFCU investigations nationwide, with over eighty percent of those open investigations involving allegations of fraud.  All indications suggest that MFCUs will continue to maintain and expand their enforcement activities in 2017.

About Faruqi & Faruqi, LLP

Faruqi & Faruqi, LLP focuses on complex civil litigation, including securities, antitrust, consumer class actions, shareholder derivative litigation and whistleblower (Qui Tam) litigation.  The firm is headquartered in New York, and maintains offices in California, Delaware and Pennsylvania.  Since its founding in 1995, Faruqi & Faruqi, LLP has served as lead or co-lead counsel in numerous high-profile cases which ultimately provided significant recoveries to investors, consumers and employees. To schedule a free consultation with our attorneys and to learn more about your legal rights, call our offices today at (877) 247-4292.

About T. Talyana Bromberg

Talyana Bromberg is a partner in Faruqi & Faruqi, LLP’s Pennsylvania office and chair of its False Claims Litigation group.  Ms. Bromberg focuses her practice on representing whistleblowers in Medicare and Medicaid fraud cases, educational, financial, tax, defense contractors’ fraud and matters involving bribery under the Foreign Corrupt Practices Act.

Ms. Bromberg was a lead attorney representing whistleblower Ronald Streck in the lawsuits against pharmaceutical manufacturers AstraZeneca Pharmaceuticals LP, Cephalon, Inc., Biogen Inc., and Genzyme Corp.  relating to underpayment of Medicaid rebates, with  settlements totaling  over $59.8 million. She represented whistleblowers in pharmaceutical lawsuits against Abbott Laboratories related to off-label promotion and payment of kickbacks for anti-seizure drug Depakote that resulted in a $1.6 billion settlement; against GlaxoSmithKline related to unlawful marketing tactics and kickbacks for GSK drug Advair for a $1.04 billion settlement; and against Pfizer for alleged illegal promotion of its kidney transplant drug Rapamune, resulting in $257 million settlement.

The False Claims Act allows whistleblowers to sue those who commit fraud against the government and to receive between 15 and 30 percent of the recovered funds. The law covers fraud involving any government-funded contract or program, including Medicare, Medicaid, military, transportation, housing, educational, agricultural, or other program. Separate IRS, SEC and CFTC whistleblower programs cover federal tax fraud, securities and commodities fraud. Since 1986, whistleblowers have helped the government to recover more than $40 billion by bringing lawsuits under the federal and state False Claims Acts.

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