State News

Perdue begins Medicaid fraud, waste prevention effort

Posted March 24, 2010 4:01 a.m. EDT
Updated March 24, 2010 3:46 p.m. EDT

— Gov. Beverly Perdue says it's time for North Carolina to enter the technological age when it comes to curbing fraud and abuse of the state's $10 billion Medicaid program.

Perdue announced on Wednesday the state's Medicaid office has started using a computer program designed to review Medicaid files to determine whether patients or physicians are gaming the system. The effort requires scanning untold pages of paper documents over the years.

A new "Medicaid SWAT team" of special investigators will review cases flagged by the computer software as suspicious.

“In these tough times, when Medicaid enrollment is growing even as we face deep budget shortfalls, we must do more to root out waste and crack down on folks who are abusing or defrauding Medicaid,” Perdue said in a statement. “Tens of millions of taxpayer dollars each year are wasted on Medicaid fraud, waste and abuse. It’s got to stop, and we will not allow it to continue.”

Health and Human Services Secretary Lanier Cansler said the effort won't require a large state investment since program provider IBM will get paid based on 10 percent of the money from the waste and fraud that is uncovered.

Perdue also called for toughening North Carolina’s anti-fraud laws by stopping kickbacks to providers who refer patients for Medicaid services and ending the practice of soliciting patients for services they don’t need. She also wants to double the staff of the Medicaid Investigations Unit in the Attorney General's Office and create an awareness campaign to encourage people and providers to report Medicaid fraud, waste and abuse when they suspect it.

The Medicaid Investigations Unit is composed of investigators, auditors, attorneys and State Bureau of Investigation agents who look into cases of fraud, abuse and neglect of residents in medical facilities that receive Medicaid funding. Last year, the unit recovered $52 million. Proceeds from civil settlements typically reimburse Medicaid, and penalties go to North Carolina public schools.

“Medicaid fraud hurts our state’s most vulnerable residents and robs taxpayers,” Attorney General Roy Cooper said in a statement. “Adding more investigators and ways to detect fraud is the right direction to go to stop those who abuse the system.”