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EXPANSION- Medicaid agreement in North Carolina closes in on passage

MM Curator summary

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.


[MM Curator Summary]: There are a few more hurdles to get through before Expansioners open the champagne, namely: the budgeting for it is in a separate bill (on purpose) that will happen in July, and, oh-yeah- work requirements are in the mix.


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RALEIGH, N.C. (AP) — The details of a deal reached by North Carolina legislative Republicans to expand Medicaid to hundreds of thousands of low-income adults received overwhelming initial approval from the state Senate on Tuesday.

The 43-2 vote on formal legislation comes less than two weeks after House and Senate leaders unveiled an agreement that could cover 600,000 people who make too much to qualify for conventional Medicaid but not enough to obtain highly subsidized private insurance.

North Carolina, currently with 2.9 million enrollees in traditional Medicaid coverage, is one of 11 states that haven’t yet adopted expansion.

“We have been talking about this for a long time,” said Sen. Joyce Krawiec, a Forsyth County Republican. She shepherded the bill on the Senate floor Tuesday after opposing the expansion idea for many years.

Republicans in charge of the legislature were skeptical over the past decade about expansion, made available through the 2010 Affordable Care Act. But the tide changed over the past year as lawmakers became more comfortable with the idea. They also were tempted with the receipt of an additional $1.8 billion over two years from Congress if North Carolina signed on now. Many state officials want to earmark a great deal of that money for mental health services statewide.

An agreement reached after weeks of negotiations earlier this month also included provisions that eased or eliminated certain “certificate of need” laws that require health regulators to sign off on plans for medical entities to build locations or purchase equipment. The Senate demanded such changes as a way to increase the supply of services for the larger covered population.

The measure must pass the Senate a second time, probably on Wednesday, before it goes to the House for likely final action by the General Assembly. Democratic Gov. Roy Cooper, a longtime expansion advocate, would be asked to sign the bill into law.

While expressing support for the legislature’s agreement, Cooper is unhappy with language in the bill that delays enactment of expansion until a separate state budget bill is enacted into law. That’s likely to happen in June or July.

Republicans also now express confidence that the state’s share of medical expenses for the expansion recipients will remain at 10% The state’s hospitals will cover that share through assessments they will pay.

“For a long time, we worried about the financial impact that Medicaid expansion would have on North Carolina. We weren’t sure. But the federal government has continued to make it better and better for us,” Krawiec said.

Democratic Sen. Gladys Robinson of Guilford County pushed for expansion in years when Republican were cool to the idea. She said that while “there are some pieces that that I may not agree with, but I support getting this done.”

“It’s a little late,” Robinson said, “but we’ll take it.”

Robinson and others who spoke said expansion would benefit the working poor, many of whom work for small businesses but whose owners can’t afford to provide insurance.

Hospitals, particularly in rural areas, also will benefit from other bill language that directs the state to enter a federal program by which hospitals would receive additional Medicaid reimbursement funds. The state would seek at least $3.2 billion in hospital reimbursements during the next fiscal year thanks to the program, and that’s before expansion enrollees are considered, according to the legislature’s fiscal staff.

The measure also would beef up efforts to help expansion recipients land employment that will allow them to leave Medicaid coverage. It directs Cooper’s administration to attempt to negotiate with federal regulators to add a work requirement as a condition of participation in the expansion program to be called NC Health Works.


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STATE NEWS (MS)- Medicaid to provide less than expected for Mississippi hospitals

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The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.


[MM Curator Summary]: Turns out commercial pays way less than the BlackBox of hospital payments would have us think. All the wailing over how low Medicaid rates are may be just a tad dramatic. Or perhaps a smidgeon.


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Mississippi hospitals, many on the precipice of closure, will be getting much-needed additional money this year. 

But the amount they receive might be much lower than expected. 

The Mississippi Division of Medicaid proposed changing the way it calculates some additional funding hospitals in Mississippi receive called “supplemental payments.” One of the funds, called the Mississippi Hospital Access Program payments, gives hospitals the difference between what Medicaid actually paid for services rendered and what Medicare would have paid for similar claims, offsetting losses incurred by standard Medicaid payments being too low.

But on Feb. 15, the Mississippi Division of Medicaid submitted a request to the Centers for Medicare and Medicaid Services to change that model to pay hospitals the difference between Medicaid rates and what an average commercial plan’s rate would have paid.

The goal was to generate more money for hospitals. 

Tim Moore, president of the Mississippi Hospital Association, said the original estimate hospitals received from the Division of Medicaid for supplemental MHAP-generated funds after the change was around $450 million.

The most recent calculation, however, is $40.2 million. 

“The preliminary estimates from last fall were subject to change based on Mississippi-specific data, and those estimates were not submitted to CMS,” said Matt Westerfield, communications officer at the Division of Medicaid.

Currently, Mississippi hospitals have two sources of funds called “supplemental payments” — the MHAP and disproportionate share hospital, or DSH, payments. These funds are a combination of federal and state money.

Since it was created in 2015, MHAP has yielded half a billion dollars to Mississippi hospitals, or about 8.3% of Medicaid spending in the state. 

The problem with using average commercial reimbursement rates for a new calculation for MHAP payments is that Mississippi’s insurance reimbursement rates are so low, said Moore. 

And that’s not all: Because of a complex rule about hospital funding limits, hospitals will receive $95 million less in the second type of supplemental payment (DSH) this year.

For hospitals that mostly serve patients from low-income backgrounds, DSH payments help hospitals recoup the cost of providing care to patients who cannot afford to pay. The total amount for Mississippi hospitals averages around $230 million each year, according to Moore. 

“It’s a swap, in order to maximize dollars,” Moore said. “There’s not one lever you pull that doesn’t affect anything else.”

So, after accounting for the decrease in DSH funds, additional MHAP payments and one-time pandemic emergency relief funds, hospitals could net a total of $96 million in extra funds. 

Lawmakers are also currently considering a bill that would give an additional $80 million in federal COVID-19 relief funds to hospitals. 

Earlier this year, the Association projected that Mississippi hospitals would need a total of $230 million in additional funding to fill their financial gaps and sustain operations. Even with the grants, Mississippi hospitals are about $60 million short. 

But the money’s got to come from somewhere, Moore said. Over a third of rural hospitals are on the brink of closure and need desperate help.

“Hopefully, the Legislature will increase the $80 million to a higher number,” Moore said. 

Lt. Gov. Delbert Hosemann and Speaker Philip Gunn did not respond to questions about whether lawmakers would consider appropriating more money to hospitals by Wednesday afternoon.

And even if hospitals do get enough from additional supplemental payments, it’s possible that small, rural hospitals most in need of help will get the least funding. 

Under the new proposed MHAP supplemental payment model, the payments are adjusted based on average commercial insurance rates. But that’s not a statewide average — that’s an average for each hospital. 

So, a hospital’s extra MHAP payment will depend on how much it gets reimbursed on average by commercial insurers. And according to Mike Chaney, state insurance commissioner, that isn’t always equal.

“There are some hospitals, especially in the rural part of the state … that do not get paid on the same level that urban hospitals get paid for health care,” he said. 

Currently, Medicaid is waiting on CMS approval for the change to MHAP payments.

“Medicaid has pushed for a rapid process, if there is such a thing,” Moore said. “They’ve impressed upon CMS the urgency of getting this done.”

But he stressed that if Medicaid was expanded, Mississippi’s hospitals wouldn’t be in this state. 

“It doesn’t fix all the problems, and we’ve never said it would … but our hospitals wouldn’t be in as big a deficit as they are today,” he said. “The hole has gotten bigger and bigger and bigger. And now you’ve got to have money to fill the hole.”


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MCOs (NM)- State was prepared to notify providers on Medicaid contracts before canceled procurement

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The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.


[MM Curator Summary]: They even had the winner’s awards letters ready to go. Oh yeah, also the “sorry you lost” letter was ready to go, too.


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SANTA FE – In mid-January, state Human Services Department officials had letters ready to go notifying four of the five bidders for massive contracts to run New Mexico’s Medicaid program that they had been selected.

But those letters were never sent and, just over a week later, the agency announced it was taking the unusual step of canceling the procurement process and starting over, according to records obtained by the Journal.

The abrupt decision, which was made after Gov. Michelle Lujan Grisham expressed concern about a possible disruption of services if a current Medicaid managed care organization was not issued a new contract, has rattled the Roundhouse and prompted some lawmakers to demand more information.

Legislators earlier this month asked for the full scores of the initial Medicaid contract bidders, after a Journal report on the evaluations, while also questioning top Human Services Department officials about the decision to cancel the process.

“Knowing what those scoring sheets look like, I think that would be useful to us while we’re still here at the Legislature,” said Sen. William Sharer, R-Farmington, during a Senate Finance Committee meeting earlier this month.

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In response, Human Services acting Secretary Kari Armijo said the agency was in the process of hiring an outside Medicaid expert and should have recommendations about the new contract structure within the next 45 days.

In the time since Armijo addressed legislators, the state has contracted with an outside expert who will make recommendations regarding the procurement process and timeline, HSD spokeswoman Marina Piña said this week.

In her discussion with lawmakers, Armijo also said she could not discuss specific evaluations, but vowed to provide senators with the score sheets in question.

“There were concerns expressed about low scores in certain critical areas almost across the board on all bidders in certain key areas that are very important to the Medicaid program,” Armijo said.

She also said health insurers need to bring their “A game” in their follow-up bids.

However, she did not tell lawmakers just how close the department was to readying the announcement of the new contract recipients under the state’s Medicaid program, which were set to take effect next year as part of a rebranded program known as Turquoise Care.

The new documents obtained by the Journal show the state readied intent letters announcing the awarding of contracts for the health care insurers vying for Turquoise Care contracts less than two weeks before canceling the procurement.

The documents, which include email communications involving Armijo, former HSD Secretary David Scrase and former Medicaid Director Nicole Comeaux, also show the direct involvement of the Governor’s Office in the abrupt decision to not forge ahead with the prepared letters.

Specifically, Armijo sent a Jan. 29 email to Teresa Casados, the chief operating officer in the Governor’s Office, that references a letter that would notify managed care organizations of the state’s intent to cancel the contract process and was drafted at the “direction” of Casados two days earlier.

The email also suggested Charles Canada, HSD’s procurement manager, had not yet been notified of the decision.

Procurement scrapped

The state decided to cancel the procurement process the same day Scrase publicly announced his retirement, but did not announce the decision until three days later — on Jan. 30.

The decision, according to Piña, in part came from the low scores the five bidders received.

Blue Cross and Blue Shield of New Mexico, one of four providers on the state’s current Medicaid contract, scored the highest with 1,083.5 points out of a maximum of 1,815 points.

Western Sky Community Care, a subsidiary of St. Louis-based Centene Corp. and also a current managed care organization, was the lone provider not recommended for a new contract under the previous procurement, scoring a total of 1,022 points.

After the scores were shared, the governor and top staffers in her office “shared concerns” with top HSD officials about a possible disruption of services, a Lujan Grisham spokeswoman told the Journal last month.

But the Human Services Department previously said the reason for halting the procurement process was due to the high-level departures of Scrase and Comeaux, and in order to give their successors the ability to help guide the contract process.

Comeaux has declined to comment on the issue, while Scrase said last month he did not have much insight into the decision.

Scores were low

New Mexico currently pays about $935 million in state funds to run its Medicaid program, and roughly $8 billion total when federal matching funds are included.

While the Human Services Department has withheld the submitted bids, describing them as “confidential,” the agency has disclosed the final scores of the five health insurers seeking to land Medicaid contracts.

Those scores show the four highest-ranked bidders were Presbyterian Health Plan, UnitedHealthcare of New Mexico, Blue Cross and Blue Shield of New Mexico and Molina Healthcare of New Mexico.

Drafted intent letters were written for all four of those insurers, according to records obtained by the Journal.

The records also show a letter had been drafted notifying Western Sky Community Care that it had not been selected for a contract for the new Medicaid program.

While Human Services Department officials have insisted the agency still intends to pick new providers before the end of this year, some lawmakers have floated the possibility of more legislative involvement in future instances when a procurement is canceled.

“I think the Legislature may have the authority to look at the RFPs and say, ‘Here are the top five providers,'” said Sen. George Muñoz, D-Gallup, the Senate Finance Committee’s chairman.

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MCOs (IN)- Centene comes up short on new Indiana Medicaid contract

MM Curator summary

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.


[MM Curator Summary]: The loss stings, but new(ish) CEO London assures shareholders that there is robust lesson-learning happening.


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Centene’s headquarters in Clayton.

Dilip Vishwanat | SLBJ

Clayton-based Centene Corp. (NYSE: CNC) has lost out on a lucrative contract for a new managed care program in Indiana.

The Indiana Department of Administration recommended on March 1 that negotiations begin with four bidders to provide services so Medicaid recipients over the age of 60 can continue to live in their homes.

Those companies are Anthem Blue Cross and Blue Shield, Humana Healthy Horizons in Indiana, Molina Healthcare of Indiana and UnitedHealthcare Community Plan. A wholly-owned subsidiary of Clayton-based Centene, Managed Health Services, was not chosen, along with CareSource Indiana and MDWise Inc.

The estimated value for the four-year contracts is $3.8 billion for each of the companies chosen through a request for proposal, which the state of Indiana issued in February 2022. Managed Health Services ranked fifth in the final RFP score to provide long-term services and supports, referred to as LTSS.

The outcome is the latest in a series of ups and downs in the post-CEO Michael Neidorff era. In late December, Centene won back two big-ticket Medicaid contracts in California after filing appeals. A California state agency scrapped an RFP and issued direct contacts with Centene’s subsidiary to serve Medicaid enrollees in Los Angeles County – with a 50% subcontract to Molina Healthcare of California – as well as in Sacramento and eight other counties.

A few weeks earlier, the U.S. Department of Defense on Thursday bypassed Centene in awarding $136 billion in contracts for the health insurance provided to active-duty military members, a blow to Centene, which long held some of the work.

Centene’s current CEO, Sarah London, was asked Tuesday at the Barclays Global Healthcare Conference about the RFP pipeline this year.

“The recent Indiana LTSS result was certainly not what we were looking for,” said London. “But I will say that the organization across all lines of business has an increased discipline around looking at where things don’t always go the way we want them to and pulling out valuable lessons learned.”


Centene CEO Sarah London

Centene Corp.

The new program, Indiana Pathways for Aging, is scheduled to launch in the summer of 2024, according to a spokesperson for the Indiana Family and Social Services Administration.

Managed Health Services is a managed care entity that has operated in Indiana for about 25 years through the Hoosier Healthwise and Hoosier Care Connect Medicaid programs and the Healthy Indiana Medicaid alternative program. MHS also offers a Medicare Advantage plan and health plans through the Affordable Care Act marketplace in Indiana.

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FWA (MO)- Moberly doctor pleads guilty to defrauding Medicare, Medicaid

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The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.


[MM Curator Summary]: Justin LaMonda and his dad worked together to steal from Medicare and Medicaid. After Justin had already been kicked out of the Medicare program.


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A doctor from Moberly plead guilty Tuesday to federal charges of making false statements related to health care matters, according to a release from the office of the U.S. Attorney for the Eastern District of Missouri.

Dr. Justin G. LaMonda, 41, admitted to using his father’s name to bill Medicare and Medicaid for medical services, according to the release.

In his plea, LaMonda said he and his father mutually agreed to falsely bill Medicare and Missouri Medicaid for services performed by LaMonda as if they were performed by his father, who is also a doctor. 

LaMonda’s medical license was previously suspended for 30 days in 2017 after he was accused of engaging in sexual activity with his office manager. He then prescribed her controlled substances “without sufficient examination,” the plea says.

In 2018, a Medicare administrative contractor revoked his Medicare privileges after determining he submitted reimbursement claims for services performed when he was suspended. In 2019, his Medicare provider number was terminated.

When payments were received for services performed by LaMonda, his father would transfer the funds back to him, the plea agreement said. LaMonda admitted to causing total losses of $537,322 to Medicare and Missouri Medicaid.

LaMonda’s sentencing is set for July 26. He faces up to five years in prison, a fine of $250,000 or both.

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FWA (MA) -Lab charged with Medicaid fraud

MM Curator summary

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.


[MM Curator Summary]: Rita Ausiejus stole $400k from your W-2 using Medicaid claims for un-allowable urine tests for drug treatment.


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Lab charged with Medicaid fraud

A clinical laboratory and its owner have been accused of submitting over $400,000 in Medicaid claims for unauthorized urine drug tests, the attorney general’s office in Massachusetts said Friday.

The residential sobriety tests were medically unnecessary, the office said in a news release. Laboratories may not bill Medicaid for them.

The Burlington-based Solid Diagnostics, Inc. and its owner were indicted last month by a statewide grand jury on two counts each of Medicaid false claims, false claims and larceny over $1,200.

The lab and owner are scheduled to be arraigned in Middlesex Superior Court on March 21. It wasn’t immediately known if they had attorneys.

The attorney general’s office said last year, one of its Medicaid Fraud Division investigations resulted in charges against several clinical laboratories, their owners, marketing companies, and a doctor in connection with Medicaid fraud, money laundering and kickbacks involving over $2 million in urine drug tests.



BOSTON — A clinical laboratory in Burlington and its Acton owner were recently indicted following allegations of Medicaid fraud involving urine drug tests that led to the submission of more than $400,000 in false claims, according to Attorney General Andrea Joy Campbell.

Campbell announced in a press release on Friday that Solid Diagnostics Inc. and owner Rita Ausiejus were indicted by a grand jury in February on two counts each of Medicaid false claims, Medicaid reverse false claims and larceny over $1,200.

Campbell’s office alleges that Solid Diagnostics and Ausiejus submitted claims to MassHealth for urine drug tests that “were not appropriately ordered by physicians or other authorized prescribers.”

The AG added the urine drug tests were also for residential sobriety monitoring purposes. According to the release, laboratories are not allowed to bill MassHealth for tests performed at sober homes for residential monitoring purposes because such tests are not medically necessary.

By billing MassHealth and its managed care entities for these tests, the defendants allegedly caused over $400,000 in false claims.

Solid Diagnostics and Ausiejus are set to be arraigned in Middlesex Superior Court on March 21.

Attempts by The Sun to reach Solid Diagnostics were unsuccessful.

Campbell stated these charges “are the latest development in the work of the AG’s Office to address kickbacks and false claims among Medicaid providers, particularly independent clinical laboratories.”

According to the AG’s office, in December, an independent clinical laboratory agreed to pay $1.5 million to the MassHealth program to resolve allegations by the AG’s Office that it engaged in an illegal kickback relationship with a New Bedford-based clinical laboratory.


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FWA (FL) – Jelly Bean Communications Design and its Manager Settle False Claims Act Liability for Cybersecurity Failures on Florida Medicaid Enrollment Website

MM Curator summary

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.


[MM Curator Summary]: I don’t know that I have seen this before- a tech provider has been convicted of not making a website secure enough to meet HIPAA requirements, and will pay $293k.


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Jelly Bean Communications Design LLC (Jelly Bean) and Jeremy Spinks have agreed to pay $293,771 to resolve False Claims Act allegations that they failed to secure personal information on a federally funded Florida children’s health insurance website, which Jelly Bean created, hosted, and maintained.

“Government contractors responsible for handling personal information must ensure that such information is appropriately protected,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “We will use the False Claims Act to hold accountable companies and their management when they knowingly fail to comply with their cybersecurity obligations and put sensitive information at risk.”

The Florida Healthy Kids Corporation (FHKC) is a state-created entity that offers health and dental insurance for Florida children ages five through 18. FHKC receives federal Medicaid funds as well as state funds to provide children’s health insurance programs. On Oct. 31, 2013, FHKC contracted with Jelly Bean for “website design, programming and hosting services.” The agreement required that Jelly Bean provide a fully functional hosting environment that complied with the protections for personal information imposed by the Health Insurance Portability and Accountability Act of 1996, and Jelly Bean agreed to adapt, modify, and create the necessary code on the webserver to support the secure communication of data. Jeremy Spinks, the company’s manager, 50% owner, and sole employee, signed the agreement. Under its contracts with FHKC, between 2013 and 2020, Jelly Bean created, hosted, and maintained the website for FHKC, including the online application into which parents and others entered data to apply for state Medicaid insurance coverage for children.

The settlement announced today resolves allegations that from January 1, 2014, through Dec. 14, 2020, contrary to its representations in agreements and invoices, Jelly Bean did not provide secure hosting of applicants’ personal information and instead knowingly failed to properly maintain, patch, and update the software systems underlying and its related websites, leaving the site and the data Jelly Bean collected from applicants vulnerable to attack. In or around early December 2020, more than 500,000 applications submitted on were revealed to have been hacked, potentially exposing the applicants’ personal identifying information and other data. The United States alleged that Jelly Bean was running multiple outdated and vulnerable applications, including some software that Jelly Bean had not updated or patched since November 2013. In response to this data breach and Jelly Bean’s cybersecurity failures, FHKC shut down the website’s application portal in December 2020.  

“Safeguarding patients’ medical and other personal information is paramount,” said U.S. Attorney Roger Handberg for the Middle District of Florida. “This settlement demonstrates the commitment by my office and our partners to use every available tool to protect Americans’ health care data.”

“Companies have a fundamental responsibility to protect the personal information of their website users. It is unacceptable for an organization to fail to do the due diligence to keep software applications updated and secure and thereby compromise the data of thousands of children,” said Special Agent in Charge Omar Pérez Aybar of the Department of Health and Human Services, Office of Inspector General (HHS-OIG). “HHS-OIG will continue to work with our federal and state partners to ensure that enrollees can rely on their health care providers to safeguard their personal information.”

On Oct. 6, 2021, the Deputy Attorney General announced the Department’s Civil Cyber-Fraud Initiative, which aims to hold accountable entities or individuals that put U.S information or systems at risk by knowingly providing deficient cybersecurity products or services, knowingly misrepresenting their cybersecurity practices or protocols, or knowingly violating obligations to monitor and report cybersecurity incidents and breaches. Information on how to report cyber fraud can be found here.

The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section, and the U.S Attorney’s Office for the Middle District of Florida, with assistance from HHS-OIG.

The matter was handled by Trial Attorney Michael Hoffman and Assistant U.S. Attorney Jeremy Bloor.

The claims resolved by the settlement are allegations only. There has been no determination of liability.

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FWA (IL)- Hoffman Estates doctor charged with faking Medicaid, insurance claims

MM Curator summary

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.


[MM Curator Summary]: Mona Ghosh stole $1M of your tax dollars using a plain ole’ services not delivered scam. She did not say thank you.


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A Hoffman Estates doctor is facing federal fraud charges after prosecutors accused her of bilking Medicaid and private insurers out of nearly $1 million by submitting claims for services that were never provided to patients.

Mona Ghosh, 50, of Inverness, was indicted on more than a dozen charges of health care fraud, prosecutors announced today.

In court papers, Ghosh is accused of knowingly submitting false reimbursement claims for treatment that was never delivered between February 2018 and April 2022 totaling about $796,000.

Ghosh owned and operated Progressive Women’s Healthcare in Hoffman Estates during the time the false claims were submitted, according to court records.

If convicted, she faces up to 10 years in prison.

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FWA- How Medicare and Medicaid fraud became a $100B problem for the U.S.

MM Curator summary

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.


[MM Curator Summary]: The size and absurdity of the fraud used to take from your W-2 is profiled in this story. I would say it’s a great read, but it really does just go to show how little you, the taxpayer, are appreciated for funding all this wonderful fraud.


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watch now


Fraud Inc: How to steal $100 billion from Medicare and Medicaid

CNBC Investigations

A nondescript suite of offices in a bland building tucked in a quiet Miami suburb seemed as good a place as any for a medical supply company to rent some office space.

But this company rented space two floors above a regional office of the U.S. Department of Health and Human Services’ criminal investigative unit. It also tried billing Medicare more than $500,000 for various medical equipment — such as braces, orthotics and wheelchairs — for patients who didn’t exist.

During a routine check by HHS’ Office of Inspector General, which investigates Medicare and Medicaid fraud, special agents in Florida noticed that a local company had recently changed owners and had another address in their building. But that location didn’t have any actual employees. It was no more than a mail drop, a physical location of a shell corporation designed to make it look legitimate on paper, said Omar Pérez Aybar, special agent in charge for Florida.

A deeper look at the company’s billing practices revealed what appeared to be Medicare fraud, Pérez Aybar said.

When agents grilled the new owner, he admitted his name was used on corporate business records to conceal the identity of the real owners. Because the investigation is still ongoing and no arrests have been made, agents provided few details identifying the operation. But Pérez Aybar said it was shuttered last year before Medicare lost any money.

Fraud flourishes

That’s just one of thousands of examples of how Medicare fraud is flourishing — not only in south Florida, but across the country.

Taxpayers are losing more than $100 billion a year to Medicare and Medicaid fraud, according to estimates from the National Health Care Anti-Fraud Association.

“That’s probably a conservative number,” Pérez Aybar said. “When we think about all lines of business in Medicare and Medicaid, that’s probably a drop in the bucket.”

Omar Pérez Aybar, Special Agent In Charge / Office of Inspector General


The fraud runs the gamut: billing for unapproved Covid tests, phony billing for wheelchairs, braces and other medical equipment, genetic testing fraud, home health-care billing and a host of other schemes. Investigators say fraudsters have gotten more brazen in recent years — as Washington swiftly doled out trillions of dollars in Covid-19 relief funds and other aid in response to the pandemic.

The proliferation of crime has taxed the inspector general, which has just 450 agents around the country. The amount at stake is staggering: Medicare spends about $901 billion a year on its 65 million beneficiaries, while Medicaid spends $734 billion providing medical coverage to more than 85 million poor and disabled Americans every year, according to the Centers for Medicare and Medicaid Services, which falls under HHS. The inspector general describes the fraud as prevalent and inventive, routinely ensnaring full-time criminals as well as legitimate doctors and health-care professionals gone bad, according to its annual reports.

Ripping off Medicare is ‘easy’

“It’s just so easy. It’s unbelievable,” said one Miami man, who admitted that he used to make a living by stealing from Medicare.

This convicted felon says Medicare and Medicaid fraud is “very easy” to get away with.


“You’ll be surprised. For money, they’ll do anything,” he said, asking not to be identified for fear of retribution by people he worked with in the criminal underworld. “It’s always been like that. And people keep on — they get caught, they get out, and they’ll do it all over again.”

He was arrested and charged with running an illegal pill business, according to agents who worked his case. The scheme involved multiple players who were all on the take and got a cut of the windfall from defrauding Medicare, the special agents said.

Describing the scheme, the fraudster said he recruited patients to get a prescription from a doctor that was then filled at a pharmacy and paid for by Medicare. He would then remove the label and “wash” the bottle to make it look new before reselling the pills to a wholesaler, which would sell them back to that pharmacy or another one that was in on the deal, he said. The same pills could be sold and resold multiple times with different phony patients, billing Medicare each time.

It was a lucrative scheme.

‘I had houses, I had cars’

“I was low-profile, nobody knew about me. I had everything. I had houses, I had cars, I had watches,” he said, adding that he routinely raked in millions from health-care fraud for more than a decade.

Eventually, though, someone who knew him was caught and turned him over to law enforcement in exchange for more lenient treatment, he said. He ended up pleading guilty to health care-related fraud and served three years in prison.

Even when the fraudsters get caught — the reward may outweigh the risk.

“I don’t think the government can keep up,” he said. “People keep on. They’re not gonna stop.”

Pérez Aybar said the inspector general is understaffed to handle the never-ending volume of cases. In fiscal year 2021, about 2 cents of every $100 spent by HHS went to oversight and enforcement, according to figures compiled by the inspector general’s office.

Fraud is something Medicare and Medicaid take very seriously, Dara Corrigan, deputy administrator of the Centers for Medicare and Medicaid Services, said in a statement to CNBC.

“We continuously work to safeguard taxpayer dollars and strengthen program integrity in our operations by identifying vulnerabilities in the system,” she said. “CMS uses every tool we have to lower the risk of fraud and abuse in the Medicare and Medicaid programs, and collaboratively works with law enforcement to identify and investigate fraud and abuse.”

Buried treasure

In another scheme, inspector general agents in 2021 found $2.5 million in cash wrapped in plastic tucked inside PVC pipes under the home of Jesus Garces. He is serving a 12½-year sentence after he pleaded guilty that year to one count of conspiracy to commit health-care fraud and wire fraud. Garces was operating a fraudulent Medicare company out of a strip mall, Pérez Aybar said. A government informant recorded Garces on a hidden camera smiling as he counted cash he stole from Medicare, according to investigators and a copy of the video obtained by CNBC.

Federal Agents found millions of dollars stuffed in PVC pipes under the home of a man now in prison for Medicare fraud.


“We were shocked to know that there was this amount of cash,” Pérez Aybar said. “I think a lot of us hadn’t necessarily seen that much, but it was how it had been packaged, vacuum sealed in bricks, again, stuffed into PVC pipes. And it really was, for us, an indication of how brazen this [durable medical equipment] fraud is.”

Garces “thought he was a CEO, when in fact he was just a crook,” Pérez Aybar said.

Ricardo Carcas, the special agent who oversaw the Garces case, explained how these schemes typically work.

“When I show up, I see that it is the shell that we typically see in this durable medical equipment fraud scheme,” Carcas said, pointing to the storefront in a Miami strip mall where Garces set up his fraudulent medical device company. “It was empty pretty much — it just had a desk (and) a shelf with maybe three orthotic braces in there. And it was closed during operating hours.”

To prove it was fraudulent, Carcas said he identified the referring doctors who supposedly signed off on patients who were billing their medical equipment to Medicare. None of the patients saw those doctors.


“They purchased a list of patient information,” Pérez Aybar said. “They have doctors that they either are using as part of the scheme, they’re paying kickbacks, or they may purchase a list of doctors’ information as well, and then you start submitting the claims. Once the money gets into the bank account, they have money launderers and mules that they paid to go out and just pull the money out of those accounts.”

Pérez Aybar described battling the fraudsters as “almost like the game of whack-a-mole, where we hit one and another pops up.”

On the ground, agents fighting health-care fraud see a never-ending scenario.

Take the Miami Merchandise Mart, for instance.

The sprawling, aging indoor mall houses low-cost, wholesale retailers along with numerous medical supply businesses set up to bilk the government, according to investigators.

When CNBC visited the mall in December, there were numerous storefronts that were largely empty, but for the names of the medical supply companies that adorned the entrances.

Pérez Aybar described what agents have found at the mall and elsewhere during previous investigations.

“It is Medicare regulations that you have to have a business, especially in this case for durable medical equipment. And so usually what — when we go out, what I will see is just a bit of a shell. It’s an office that’s maybe 12 by 15 feet wide,” he said.

“There’s a desk, perhaps, there’s a bit of a curio with one or two different types of braces. They’ll have the manuals that Medicare requires that — that they’re familiar with. And usually there’s some type of partition if let’s say we’re talking about orthotics because the patient is supposed to come in and actually get fitted.”

Medicare storefronts

Along a corridor in the mall, CNBC found a young woman sitting alone at a desk in a small glass-enclosed store called United Med Supply Market Inc. She said it was a medical supply business and gave us the business card with a phone number for the owner. When a reporter called the number a few minutes later, it rang at the woman’s desk.

Company President Antonio Lantigua was reached by phone several weeks later. When asked why equipment wasn’t visible on site, he said they keep it in other locations.

“We have equipment in other places. We send papers to the company; the company sends equipment to the patients,” Lantigua said.

When pressed for more information, he said, “I don’t know why you are calling me” and hung up.

Government records show United Med Supply Market billed Medicare for more than $2 million, mostly for wound care.

Following an investigation by the inspector general, the business was suspended from billing for Medicare payments.

Ali Ghraoui, general manager of the Miami Merchandise Mart, told CNBC in a February interview that United Medical vacated that space and that he was working to improve the image of the mall.

Still, as Pérez Aybar points out, there’s always another fraudulent operation ready to bilk the system.

“South Florida, without question, is the ground zero for health-care fraud, but it’s only one state. There are 49 others and territories where these types of schemes are occurring,” he said.

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EXPANSION- Medicaid Expansion Fails to Deliver on Promises

MM Curator summary

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.


[MM Curator Summary]: Some findings you won’t like. Move along and don’t read this.


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Medicaid expansion is failing states across the nation according to a recent Foundation for Government Accountability (FGA) report. The report found states that have expanded Medicaid have faced more hospital closures than states that haven’t expanded the program. Of course, for years, advocates have claimed that expansion would be a necessary provision for financial health and job security for hospitals. Though, as suspected, data reveals the opposite. More accurately, non-expansion states have seen improved profitability, a larger bed capacity, and increased job growth. 

For quite some time, expansion advocates have made the promise that Medicaid expansion would lead to economic booms for states, creating jobs and improving hospital finances, but the program’s launch clearly tells a different story.

By expanding Medicaid through the Affordable Care Act (ACA), colloquially known as “Obamacare,” the federal government hoped to provide care for a larger share of low-income Americans. Under the ACA, states now have the option to expand their Medicaid programs to cover adults 65 and under with incomes up to 138% of the federal poverty level and an enhanced federal matching rate (FMAP) for their expansion populations. FMAP varies by state but allows the Centers for Medicare & Medicaid Services to reimburse each state for a percentage of its total Medicaid expenditures. As of now, 38 states have adopted Medicaid expansion.

States that have enacted the expansion are consequently awaiting success but face unrealized promises. Moreover, in the first year of the program, nearly 40% of expansion states lost hospital jobs.

Here are the grim statistics from FGA’s report:

  • 1 in 5 expansion states saw hospital job losses.
  • From 2013 to 2016, Medicaid shortfalls at hospitals in expansion states grew by nearly 50%.
  • Nearly 50 hospitals, many of which were rural facilities, shut their doors after expansion was implemented.
  • Only 5% of hospitals directly cited a lack of Medicaid expansion in their list of reasons for closure; however, half of these hospitals were involved in alleged fraud or severe financial malpractice.
  • 1 in 4 rural hospitals in expansion states are at risk for closure.

The report also highlights the flaws in the health systems of Appalachian states, many of which have expanded Medicaid. The report states that the Ohio Valley Medical Center in Wheeling, West Virginia and East Ohio Regional Hospital in Martins Ferry, Ohio closed in 2019 resulting in the release of roughly 1,200 hospital workers. According to the report, hospitals partly accredited the closures, creating $37 million in losses, due to the “lower-reimbursing Medicaid program.”

Likewise, in the month prior to expansion, West Virginia had 40,100 hospital jobs. A year later, that number fell to 39,728 – the opposite of what has been seen in non-expansion states. States that have maintained non-expansion Medicaid, over a period of five years, enjoyed 14% faster hospital job growth than expansion states. 

Many states across the nation are still facing the same health care issues from before implementation of Medicaid expansion. Despite haughty claims that Medicaid expansion would be the elixir to cure hospital pains, the evidence is clear that the expansion “tool” is just not enough. Hospitals continue to close.

Jessica Dobrinsky Harris is a Policy Analyst at the Cardinal Institute for WV Policy.