Senate passes bill that would move Medicaid Fraud Control Unit to AG's office

By Chris Dickerson | Feb 27, 2019

CHARLESTON — The state Senate has passed a bill that would move the state's Medicaid Fraud Control Unit to be housed in the state Attorney General's office.

On a 26-8 vote, the Senate voted Feb. 27 to pass Senate Bill 318. The bill now will go to the House of Delegates, where a similar bill already was introduced by House Judiciary Chairman John Shott (R-Mercer). Judiciary Chairman Charles Trump (R-Morgan) is the lead sponsor of the Senate bill.

Attorney General Patrick Morrisey praised the bill's passage and is urging the House to pass the bill he says would strengthen the state’s fight against Medicaid fraud.

“There is no reason to delay passage of this common sense legislation,” Morrisey said. “A responsible government must do everything in its power to fight waste, fraud and abuse, and now is the time for the state House of Delegates to follow the lead of 43 other states and allow our office to mount an aggressive fight against Medicaid fraud for the benefit of those who legitimately need the assistance.”

Morrisey also says the move would save taxpayers many millions each year and bring West Virginia in line with the majority of other states.

Currently, the unit is housed under the Department of Health and Human Resources' Office of Inspector General.

“Right now, 43 states have their Medicaid Fraud Control Units under the attorneys general,” Morrisey recently told The West Virginia Record. “This is not a controversial idea. It just makes sense to make this change.

“We have the disability fraud unit here already. We’d like to build on that. We have the expertise. We want to protect those people who need these Medicaid benefits.”

Morrisey said Medicaid is meant to provide medical care for low-income residents and families who need assistance. He said the bill’s passage would fix deficiencies in West Virginia’s existing unit and yield greater efficiency and effectiveness to the benefit of the taxpayer.

“A responsible government, accountable to its citizens, cannot condone such thievery,” he said. “It must attack waste, fraud and abuse at every level, and our effectiveness in rooting out more than $14.3 million in disability fraud proves the success we can have in fighting Medicaid fraud.

“We have relationships with the attorneys general in these other states. We can use those relationships to partner up with other states to make this unit even more powerful.

“We hope the stars align this session to make it happen. We’re optimistic and hopeful.”

Last month, Morrisey’s office announced its disability fraud partnership has generated more than $14.3 million since its inception, including a record-breaking $6.2 million in calendar year 2018.

During a House of Delegates budget hearing last month, Morrisey touted the plan to take over the Medicaid fraud unit.

“I’m hopeful this is the year that folks take advantage of the savings opportunities and the quality you can bring to bear if you move that division and you are consistent with what 43 other states do,” Morrisey said.

On the DHHR’s Office of Inspector General’s website, it says the unit “is the single entity of West Virginia state government that is certified annually by the Secretary of the U.S. Department of Health and Human Services to conduct statewide investigations of health care providers that defraud the Medicaid program.”

The unit investigates complaints of criminal abuse or neglect in any health care facility, as well as allegations of misappropriation of patients' private funds in Medicaid facilities. The unit is also charged with the investigation of fraud in the administration of the Medicaid program.

Its website says the unit’s mission is “to protect West Virginia’s vulnerable citizens and the integrity of its health care program. In fulfillment of that mission, the MFCU investigates allegations of fraud in the Medicaid program and allegations of criminal abuse, neglect, or financial exploitation of residents in health care facilities or board and care homes.”

Under new director Mike Malone, the state’s current Medicaid fraud unit features eight investigators, two auditors and one data mining specialist. It has a budget of $1.88 million.

Morrisey also said Medicaid spending in the state totals more than $3.7 billion. That money is distributed by the DHHR. Morrisey also believes the agency handing out the money shouldn’t be the one investigating possible fraud.

“If one department is going to be spending such a significant portion of the state budget, it certainly makes a lot of sense to have a completely separate entity take a look at that and analyze the expenditures,” he said. “I think that alone, a fresh pair of eyes on a variety of issues, could result in savings.

“This is the second largest program in West Virginia. This is about budget savings, and I think it could be very beneficial.”

The Medicaid Fraud Control Unit has been under DHHR control since the unit's inception more than 35 years ago.

"The MFCU is better suited under DHHR because the unit has statewide criminal investigation authority and MFCU attorneys may assist in the prosecution of Medicaid Fraud, authority the Attorney General’s office does not currently have," DHHR spokeswoman Allison Adler told The Record. "In fact, the MFCU legal division has successfully prosecuted fraud and financial exploitation cases utilizing a MFCU Special Assistant Prosecuting Attorney and obtained felony convictions."

Additionally, Adler said moving the unit would create unnecessary costs for the state.

"Additionally, it (the MFCU) has developed solid working relationships both within and outside DHHR and has had a number of successes including a healthcare fraud settlement of $2.21 million dollars, obtained in cooperation with the United States Attorney’s Office in 2017," she said. "In the last five years, recoveries have totaled more than $34 million dollars. Fiscal Year 2018 recoveries totaled $5.4 million, with seven cases referred for prosecution, seven civil cases resolved and seven criminal convictions obtained."

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West Virginia Attorney General West Virginia Department of Health and Human Resources West Virginia House of Delegates West Virginia State Senate

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