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Alabama State Medicaid Fraud Control Unit: 2014 Onsite Review


OIG oversees the activities of all Medicaid Fraud Control Units (MFCUs or Units). As part of this oversight, OIG conducts periodic reviews of all Units and prepares public reports based on these reviews. The reviews assess Unit performance in accordance with the 12 MFCU performance standards and monitor Unit compliance with Federal grant requirements.


We conducted the onsite review in January 2014. We based our review on an analysis of data from seven sources: (1) a review of policies, procedures, and documentation of the Unit's operations, staffing, and caseload; (2) a review of financial documentation; (3) structured interviews with key stakeholders; (4) a survey of Unit staff; (5) structured interviews with the Unit management and selected staff; (6) an onsite review of case files; and (7) an onsite observation of the Unit operations.


For fiscal years 2011 through 2013, the Unit reported 10 criminal convictions, 63 civil judgments and settlements, and recoveries of over $63 million. We identified one issue of significant noncompliance with applicable laws, regulations, or policy transmittals - nearly half of the Unit's civil settlements resulted from audits that were outside the MCFU's grant authority. We also found multiple opportunities for improvement in the Unit's performance. Only a small portion of Unit referrals-6 percent-came from the State Medicaid agency. The Unit did not have a cooperative working relationship with certain Federal partners and lacked written policies for referring cases to Federal and State agencies. The Unit also did not refer information about all convictions to OIG and did not send some information within the appropriate timeframe. Unit supervisors did not always conduct periodic case reviews and, when they did conduct such reviews, they did not include notations in case files.


We recommend that the Alabama Unit (1) strengthen processes to ensure that investigations involve allegations of fraud or patient abuse or neglect; (2) provide training to the State Medicaid agency regarding elements of a quality referral of fraud; (3) continue existing efforts, and initiate new efforts, to achieve a cooperative working relationship with its Federal partners; (4) implement procedures to ensure that it timely transmits information about all convictions to OIG for purposes of exclusion; and (5) implement processes to ensure that supervisors conduct case reviews periodically, consistent with the Unit's policies and procedures. The Unit concurred with all five of our recommendations.