The OIG plays a prominent role in the Medicaid Fraud Control Units (MFCU) throughout the country. The role of MFCUs is to investigate Medicaid fraud and patient abuse or neglect in facility settings, and then prosecute those cases or refer them to other prosecuting offices. Each MFCU receives a Federal grant equivalent to 90 percent for new Units and 75 percent of total expenditures for all other Units. In fiscal year 2018, combined Federal and State expenditures for all Units totaled approximately $294 million.
The OIG administers a grant award and provides oversight to each MFCU. As part of its oversight, OIG reviews and recertifies each MFCU annually and conducts periodic onsite reviews. The OIG’s most recent MFCU onsite report was published in July 2019. The report gives us insight, as compliance professionals, into how the OIG measures an effective oversight program.
Through the recertification review, OIG will assess an MFCU’s performance, as measured by its adherence to published performance standards. Also, during an onsite review, OIG will make observations regarding MFCU operations and practices that could be useful to other state Units.
Diving into the budgeting, employees, activities, and resources of an MFCU, I think is a great way for compliance officers to consider their own risk assessments and the prioritizations of their Medicaid risks.
Diving Into the Kansas MFCU
In 2018, OIG conducted an inspection of the Kansas MFCU covering fiscal years 2015 - 2017. At the time of the onsite inspection, the Kansas Unit employed a staff of 16. The Unit staff included a director and deputy director, a special agent in charge (SAC), five special agents, a nurse investigator, a chief auditor, four auditors, two attorneys, and a legal assistant. During the review period, Unit expenditures were approximately $4 million, with a State share totaling $994,000.
The primary sources of fraud referrals the Unit receives come from private citizens, managed care organizations, and the State Medicaid agency. The Unit also receives referrals of patient abuse or neglect from the State the Kansas Department for Aging and Disability Services and from its private citizens.
Once the Unit opens an investigation, Unit supervisors assign a team to the case. Teams generally include an attorney, an investigator and, when appropriate for the case, a nurse investigator and/or an auditor. For cases of patient abuse or neglect, teams consist of an attorney, an investigator, and a nurse investigator. The Unit’s policies and procedures require the SAC to conduct quarterly case file reviews of open investigations with each assigned special agent. The quarterly reviews of case files cover the case status and next steps of the investigation. The policy requires Unit staff to document these reviews in its electronic case management system. The Kansas MFCU has Statewide authority to investigate and prosecute cases of suspected Medicaid fraud. Additionally, the Unit may prosecute violations of State laws related to the abuse, neglect, or exploitation of dependent adults and the elderly. If a case is not within the Unit’s prosecutorial authority, the Unit will refer the case to the State Medicaid agency’s Program Integrity Division or to the appropriate licensing entity. When the Unit determines that Federal healthcare programs other than Medicaid are the primary victims, the Unit will refer the case to the United States Attorney’s Office or the OIG. Two Unit attorneys are cross-designated as Special Assistant United States Attorneys. These attorneys work directly with the United States Attorney’s Office on Medicaid fraud cases litigated in the United States District Court.
Carrying a Heavy Load
One of the findings in the OIG report was the larger-than-average case load its investigators carried. Kansas Medicaid expenditures in FY 2017 were approximately $3.4 billion, while the Unit employed 15 staff members. The Kansas staff mirrored Unit staff sizes of States with similarly-sized Medicaid programs. However, as Unit managers and staff reported, and the OIG confirmed, the caseloads for their professional groups were much larger than those of similarly sized states.
Unit managers and staff, with whom OIG spoke, expressed concerns about case overloads. One Unit manager stated that the timeliness of cases suffers because of the large caseloads. Another staff member explained that the large caseloads interfered with their ability to receive training. While yet another Unit manager believed investigators were overworked and found it challenging to manage both complex cases and the continued allegations being made (e.g., patient abuse or neglect.) In OIG’s judgment and experience, Unit investigators’ caseloads were double or triple the amount that other Federal investigators would typically handle.
From the finding of OIG’s onsite inspection, the Kansas MFCU is busy and, as many of us can relate, overworked. Despite the relative size of the state, they could use some additional funding to hire more employees to carry the load.
I always love getting a glimpse into how a Medicaid Fraud Control Unit is structured, funded, and reviewed. The value it provides should not go overlooked in assessing the Medicaid risks within own organizations.