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Whistleblower Complaints Resulting in Increased MFCU Investigations

false claims act: fraud protection

Considering the significant financial incentives and awards provided to whistleblowers, it should come as no surprise that there has been a marked increase in the number of health care fraud investigations commenced by federal and state agencies.  The New York State Medicaid Fraud Control Unit (“MFCU”) is one such agency and is increasingly worthy of the attention of health care practitioners who treat Medicaid patients in the state.  A division of the New York State Attorney General’s office, MFCU, has become increasingly active reviewing Medicaid program expenditures, which now account for over $50 billion dollars of the state’s annual budget.  Practitioners are encouraged to review the MFCU Resource Center materials.

MFCU has complete investigative authority and is armed with wide-ranging powers to prosecute alleged violations of health care fraud statutes and regulations related to the Medicaid program.  MFCU has the power to issue subpoenas for medical records and other documents, interview employees of medical practice, and even refer matters to regulatory agencies, such as the New York State Department of Health.  These investigations may result in either criminal proceedings or civil enforcement actions brought against an alleged violator.  The types of arrangements that are typically investigated by MFCU and that result in adverse actions are:

  • Billing for services not rendered or incorrectly coding the services or procedures provided to patients
  • Entering into financial arrangements with other practitioners that provide financial reimbursement, or “kickbacks,” in exchange for referrals
  • Employing practitioners or staffers who are excluded or otherwise barred from government health care plans
  • Operation of a “Medicaid Mill” wherein revenue is generated by billing Medicaid for a wide range of services without medical necessity
  • Selling access to prescription drugs
  • “Double-Billing” whereby a practitioner is alleged to submit claims to both Medicaid and a commercial insurance company
  • Accepting cash payments from patients for services otherwise covered by Medicaid

As always, practitioners are strongly encouraged to consult with healthcare counsel to review their compliance with applicable regulations.  Strict compliance with these regulations will significantly reduce the risk of falling under the scrutiny of MFCU.  If you have any questions about this or any other legal matter, please email me at