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Nine arrested statewide for Medicaid fraud, AG Cooper announces

Release date: 12/18/2012

Suspects alleged to have billed for medical services they didn’t provide, more arrests expected

Raleigh:  Nine health care providers accused of defrauding taxpayers and the Medicaid system were arrested this week as part of a continuing crackdown on fraud, Attorney General Roy Cooper announced Tuesday.
The nine individuals were arrested in five different counties for engaging in various schemes to defraud the North Carolina Medical Assistance Program (Medicaid).  Criminal charges levied against these health care providers include felony charges of Obtaining Property by False Pretenses and Medicaid Provider Fraud. The charges allege approximately $200,000 in fraudulent payments.
“We’re continuing our crackdown to deter those who would commit health care fraud,” Cooper said. “Cheating Medicaid is illegal, and our investigators and attorneys are finding violators and making them pay.”
Health care providers arrested by State Bureau of Investigation agents on Tuesday, December 18 include a dentist, home health care workers, a mental health care provider, and an HIV case manager. Law enforcement arrested the suspects in Wake, Cumberland, Dare, Alleghany and Sampson counties this morning, with more arrests expected in the coming weeks. See the attached summary for details on each case.
The state is pursing criminal convictions as well as restitution of money from the accused. 
Local law enforcement, the U.S. Department of Health and Human Services Office of Inspector General, the Internal Revenue Service, and the Division of Medical Assistance of the N.C. Department of Health and Human Services are assisting with the cases.
Today’s arrests are the continuation of a Medicaid fraud sweep that started with 20 arrests in December 2011. Those cases have resulted in 17 convictions to date, with two more cases pending court or trial and one suspect still wanted for arrest.
The Attorney General’s Medicaid Investigation Division (MID) nearly doubled in size last year with the addition of new attorneys, investigators, criminal information analysts and support staff, allowing the MID to take on 46 percent more cases than before.
With the added staff have come major changes in how the group goes after fraud. Members of the MID are now organized into investigative teams that include intelligence analysts, financial investigators, SBI agents, and civil and criminal attorneys.  The teams are able to work even more effectively and efficiently to uncover possible fraud, search complex records, track down evidence in the field, and prosecute cases in court.
“The arrests and the money we recover also save taxpayer money by discouraging health providers who might be considering cheating,” Cooper said.
North Carolina’s MID has recouped more than $500 million over the past decade and helped to convict hundreds of individuals on criminal charges including patient abuse and neglect as well as financial fraud. During the federal fiscal year that ended September 30, 2012, the MID won 33 criminal convictions and 14 civil settlements that recovered $94,390,397.85 from Medicaid abusers.
The Attorney General’s MID investigates fraud and abuse of Medicaid benefits by hospitals, doctors, pharmaceutical companies, medical equipment companies, mental health and personal care providers, ambulance services and others. The MID also investigates patient abuse and neglect in nursing homes and other Medicaid-funded facilities, and works closely with United States Attorneys, District Attorneys, and other state and federal law enforcement agencies.

Media contacts:  Noelle Talley (919) 716-6413