States such as California and Hawaii seemed to lag behind others in combatting fraud, said Vance, whom the president picked in March to lead an anti-fraud task force.
“Now, we have red states and blue states that go after fraud aggressively, but we also unfortunately have some states, mostly blue states, unfortunately, that do not take Medicaid fraud very seriously,” he said.
In response, Vance said the administration would withhold $1.3 billion in Medicaid-related payments to California and also consider withholding from other states.
The administration put each of the 50 states on notice with recent letters signed by Health and Human Services Inspector General Thomas “March” Bell. It focused on state-level Medicaid Fraud Control Units (MFCUs), which receive federal funding.
Letters also went to the District of Columbia, Puerto Rico, and the U.S. Virgin Islands.
Here’s what to know about the units and Vance’s efforts.
Federal Grants at Stake
The letters threatened to take away all federal grants provided to a state’s Medicaid program if the state was not fulfilling its duties.
“It has become clear … that many MFCUs have been happy to rake in taxpayer dollars without fighting fraud,” Bell stated in the letter. “And for too long, there has been a lack of leadership at HHS that has allowed billions of our fellow Americans’ dollars to flow out to State capitals to fund MFCUs to supposedly fight Medicaid fraud without any real oversight.”
He said that the units must comply with certain requirements to receive funding. Federal law requires the units to investigate and prosecute fraud, investigate patient abuse and neglect in Medicaid-funded facilities, and recover overpayments.
The units must operate statewide, employ investigators, auditors, and attorneys, and remain separate from the state agency that administers Medicaid. The law requires the units to either possess prosecutorial authority or formally coordinate with prosecutors.
https://www.zerohedge.com/political/trump-admin-targets-states-medicaid-fraud-units