Michigan Medicaid Fraud Control Unit Case Files Lacked Necessary Documentation, Says OIG

HHS' Office of the Inspector General has released the results from its onsite review of the Michigan Medicaid Fraud Control Unit that revealed the unit did not meet all of the Medicaid Fraud Control Unit performance standards.

The OIG found Michigan's control unit failed to meet the performance standards in the following ways:

1. Case files lacked documentation. The Medicaid Fraud Control Unit performance standards require supervisory approval for the opening and closing of all case files. The approval must be noted in the case file. The OIG found 21 percent of the files at the Michigan unit lacked documentation of approval to open from 2010 to 2012.

The performance standards also require unit supervisors to perform periodic reviews of all open case files and to note the review in the file. The OIG found 67 percent of the files at the Michigan unit lacked documentation of periodic supervisory reviews from 2010 to 2012.

2. Convicted individuals were not referred to the OIG. The Medicaid Fraud Control Unit performance standards require state units to inform the OIG of any individuals convicted of Medicaid fraud within their state within 30 days of the conviction for the purpose of program exclusion. The OIG found Michigan's fraud unit failed to send conviction information to the OIG for 69 percent of convicted individuals within the appropriate time frame from 2010 to 2012.

3. Unit manual was not up-to-date. The performance standards require all Medicaid fraud units to have their up-to-date policies and procedures included in a manual. The OIG found Michigan's control unit manual did not include the unit's current policies and procedures, as the manual had not been updated since the 1990s.

4. Memorandum of Understanding lacked current law. The Medicaid Fraud Control Unit performance standards require each state unit to periodically review its Memorandum of Understanding with its state's Medicaid agency to ensure the memorandum is up-to-date and contains current law. The OIG found Michigan's memorandum did not include the law which requires payment suspension of any provider against whom there is a credible allegation of fraud.

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