Kansas Medicaid fraud hits record levels
About half of the amount recovered stemmed from national settlements pursued by federal prosecutors
Fraud in Kansas’ Medicaid program increased 43 percent during the last fiscal year, reaching $33 million detected.
Kansas Attorney General Derek Schmidt released an annual report on dozens of investigations and prosecutions related to improper billing and fraud schemes in Medicaid, of which many of the larger cases were prosecuted by the federal government.
About half of the $33 million recovered stemmed from national settlements pursued by federal prosecutors, with Kansas’ Medicaid Fraud Control Unit recovering $16 million through civil judgements and $2.3 million through restitution ordered from 14 criminal convictions.
[See also: Fraud prevention through prediction.]
Kansas spent about $1.2 billion on Medicaid in the last fiscal year, with the federal government covering the other $1.8 billion needed for the program.
Attorney General Schmidt said the $33 million represented a record for the state in terms of the amount of fraud detected.
The $33 million in just over 1 percent of the entire cost of Medicaid in Kansas and about 2 percent of the state’s share of the costs. How much is actually lost to Medicaid and Medicare fraud in Kansas and nationally remains largely unknown, and debated.
Some of the settlements and convictions in Kansas, tied with national cases, yielded large amounts in fines and restitution payments.
In February, the executive of the Topeka-based Kansas Health Solutions was sentenced to three years in federal prison for conspiring to defraud Medicaid about $2 million — about the same amount he has been ordered to repay.
The state charged that as CFO of the company he directed Medicaid funds to a shell consulting firm he created, billing for IT services never performed as well as for sports equipment and a computer used by his family. Federal prosecutors said he used $375,000 of the extra money to build a 3,755 square foot house on 11 acres in Lyndon, Kan., about 80 miles southwest of Kansas City.
Others Medicaid fraud convictions yield less than $100,000.
[See also: Fraud recoveries on the rise.]
In June, a 46-year-old woman from south central Kansas was sentenced to a month in prison, 13 months under supervised release and a fine of $50,000 on a conviction healthcare fraud for receiving Medicaid and other benefits intended for her disabled sister.
A nurse from Bel Aire, northeast of Wichita, is currently awaiting sentencing after convictions on 11 counts of healthcare fraud. The nurse allegedly schemed to bill Medicaid for $700,000 in services never provided.
All told in the last fiscal year, Kansas’ Medicaid Fraud Control Unit saw 15 cases result in convictions through guilty pleas or no contest pleas. Two convictions resulted in incarceration, 22 resulted in probation and four were settled through an agreement in civil court. The unit investigated another 35 cases, but closed them without litigation or prosecution attempts.
