The Medicaid Investigations
Division
Douglas Thoren
Special Deputy Attorney General
Chief – Criminal Section
Medicaid Investigations Division
North Carolina Department of Justice
THE MOST IMPORTANT SLIDE
THE VIEWS EXPRESSED IN THIS MATERIAL
AND DURING THIS PRESENTATION ARE THE
SPEAKER’S VIEWS AND ARE NOT INTENDED TO
REPRESENT AN OFFICIAL STATEMENT OF POLICY
OR THE VIEW OR OPIONION OF THE NORTH
CAROLINA DEPARTMENT OF JUSTICE, THE
MEDICAID INVESTIGATIONS DIVISION OR
ATTORNEY GENERAL ROY COOPER.
The North Carolina Medicaid
Investigations Division
MISSION STATEMENT
The mission of the Medicaid Investigations Division is to
eliminate fraud in the North Carolina Medicaid program
through the investigation and prosecution of criminal violations,
the assessment of civil penalties, and the collection of damages
pertaining to fraud in the administration of the Medicaid
program and fraud by providers of medical assistance, and the
investigation and criminal prosecution of the physical abuse of
patients and the misappropriation of private funds of patients in
Medicaid funded health care facilities by providers, and, as
authorized by the Office of Inspector General, the investigation
of Medicare and other federal health care cases which are
primarily related to Medicaid fraud.
The North Carolina Medicaid Investigations
Division
• NC-MID constituted in 1979 by way of Federal
Legislation
• 50 units across the United States
including the District of Columbia
• Oversight by HHS-OIG
• Partially Federally funded
• Criminal and civil sections
Four Areas Of Subject Matter
Jurisdiction
• Fraud in the administration of the Medicaid
Program
• Fraud or related offenses perpetrated by
Medicaid Providers
• Patient Abuse and Neglect
• Misappropriation of Patient funds in Medicaid
facilities
• We do not do recipient fraud
Where Do Cases Come From
• Div of Medical Assistance – Program Integrity
• Division of Health Service Regulation
• Private citizens, current & former employees,
whistleblowers, providers
• MCOs, LMEs, fiscal agents, contractors,
vendors through PI
• Local, state and federal law enforcement
agencies
Investigations
Unit is made up of 23 non-sworn investigators, 7 SBI
agents, 3 analysts, 4 civil attorneys and 9 criminal
prosecutors.
Offices in Raleigh and Charlotte.
Investigate using a variety of investigative techniques:
- data analysis
- interviews
- records review
- undercover operations
- surveillance
Records review
The MID has the authority to obtain from all
Medicaid providers any and all records related to
the provision of services billed to the Medicaid
program, this includes (but is not limited to):
- Patient records
- payroll records
- billing information
- personnel files
Authority
The Medicaid Investigations Division of the North Carolina Department of Justice
is a Medicaid fraud control unit approved by the Secretary of the U. S. Department of
Health and Human Services under 42 Code of Federal Regulations § 455.300
(recodified as 42 C.F.R. §§ 1007.1 - 1007.21) and authorized by 42 C.F.R. § 431.107(b)
to request that Medicaid providers furnish access to records.
Section 431.107(b) states:
(b) Agreements. A State plan must provide for an agreement between the
Medicaid agency and each provider or organization furnishing services under the
plan in which the provider or organization agrees to:
(1) Keep any records necessary to disclose the extent of services the
provider furnishes to recipients;
(2) On request, furnish to the Medicaid agency, the Secretary, or the State
Medicaid fraud control unit (if such a unit has been approved by the
Secretary under Section 455.300 of this chapter), any information
maintained under paragraph (b)(1) of this section and any information
regarding payments claimed by the provider for furnishing services
under the plan.
Authority
The provider agreement contractually obligates
providers to provide the MID with records.
On request, furnish to the Division of Medical Assistance (EMA) and its agents, the Health
Care Financing Administration (HCFA), or the State Medicaid Fraud Control Unit of the
Attorney General's Office, any information or records, including records of any outside
entities, contractors, or subcontractors for costs related to services provided to Medicaid
patients and billed to the Medicaid Program. (emphasis added)
Recipients also agree to allow access when
applying for Medicaid.
What about HIPAA
The Medicaid Investigations Division is a health oversight agency
as defined in the Health Insurance Portability and Accountability
Act (HIPAA) in 45 C.F.R. §164.501 and the Preamble, 65 Fed.
Reg. 82462 at 82492. You are required to produce this
information to the Medicaid Investigations Division in its capacity
as a health oversight agency, and this information is necessary to
further health oversight activities. 45 C.F.R. § 164.512(d). Because
you are required by law to furnish access to records as noted
above, disclosure is permitted under HIPAA pursuant to 45
C.F.R. § 164.512(a). Since this information is requested by a
health oversight agency and is required by law, no other
requirements need to be met under the applicable federal
regulations. 45 C.F.R. § 164.12(d)(1).
But What if I say NO!
Procedure
Records Request
Scan
Search Warrant
Take
Conscious of continuing care issues.
CONFIDENTIALITY
Confidentiality is crucial to MIU investigations:
– Agent safety
– The creation of fabricated evidence
– The destruction of evidence
– Hiding, moving or disposing of assets.
Prosecutorial Authority
• Cover the entire state with authorization from
local District Attorneys
• Cross-designated at the federal level as
“SAUSA”
END GOALS
RECOUP LOSSES
EXCLUSION
CONVICTION
PRISON
State and Federal False Claims
Act
Any person who:
knowingly presents a false or fraudulent claim for
payment; conspires to present a false or fraudulent claim;
or makes a false record to avoid an obligation to pay money
to the Government is liable to the government for a civil
penalty of $5,500 to $11,000, plus three times the amount
of damages the government sustains.
State and Federal False Claims
Act
Includes a qui tam remedy:
Qui tam pro domino rege quam pro se ipso in hac
parte sequitur
“He who brings a case on behalf of our lord the
King, as well as for himself“
The qui tam provision offers a reward to citizens to
sue on behalf of the government
You do the Math
3 hours a day for a five day week at rate of $14.16
an hour
$212.40
5 separate claims (one for each day)
$55,000 in per claim penalties
$637.20 triple the amount.
plus litigation costs.
You Do the Math – Part 2
Same as above but for a month (four weeks)
($849.60)
$220,000 + 2548.80 = $222,548.80
25% = $55,637.20
For one client, for one month.
Fraud Schemes
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•
•
•
•
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Billing for Services not rendered
Identity theft
Forgery
Kickbacks
Unbundling
Up coding
MID
In the past 33 years the MID has
convicted more than 500 Medicaid providers of
crimes relating to fraud and abuse, and
recovered over $600 million in fines, restitution,
interest, penalties and costs.
DOUGLAS THOREN
5505 Creedmoor Road
Raleigh, NC, 27615
919-881-2320
DTHOREN@NCDOJ.GOV