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MN Medicaid Fraud Case Worth $12 Million, Feds Seize $2 Million

Another alleged case of Medicaid fraud in Minnesota is currently being investigated by the U.S. Attorney’s office.

The Star Tribune reports:

In a highly unusual move, federal prosecutors have seized $2 million from a former Twin Cities mental-health agency accused of submitting fraudulent bills for home services involving hundreds of Minnesota children and adults.

The U.S. Attorney’s office said it seized the funds after an investigation found that Complementary Support Services (CSS), a nonprofit based in Richfield, had fraudulently billed Medicaid.

The money represents a portion of the more than $12 million that CSS allegedly obtained through its fraudulent billing practices, the U.S. Attorney’s office said in a civil forfeiture action filed Tuesday.

According to a 2015 investigation by the Star Tribune, the agency apparently spent years bilking millions of dollars from the state.

And the agency’s actions went seemingly unnoticed.

The state’s failure to detect problems at CSS reflects a longstanding gap in Minnesota’s oversight of mental health services. Like more than 200 other agencies that provide care in the home and community, CSS is unlicensed and is not subject to routine regulatory oversight to assure that billing matched the services provided.

State records show that the Department of Human Services knew of problems with CSS’ internal controls practices as far back as 2010, when the agency was licensed by DHS to provide home and community-based services to people with developmental disabilities. Yet CSS stopped billing for those licensed services in 2011, and DHS did not terminate payments to CSS under the state’s Medicaid program until mid-November [of 2015].

Medicaid-funded care services are a hot-spot for health care abuse. And without major changes to the scam-ridden system, Medicaid rip-offs will continue at the expense of both recipients and taxpayers. 

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