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Michigan State Medicaid Fraud Control Unit: 2013 Onsite Review


OIG oversees all State Medicaid Fraud Control Units (MFCUs or Units) with respect to Federal grant compliance. As part of this oversight, OIG annually reviews and certifies all Units. In addition, OIG conducts onsite reviews of selected States. These reviews assess Unit performance in accordance with the 12 MFCU performance standards and monitor Unit compliance with Federal grant requirements, laws, and regulations.


We analyzed data from seven sources: (1) a review of documentation, policies, and procedures related to 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's management and selected staff; (6) an onsite review of case files; and (7) an onsite review of Unit operations.


From fiscal years 2010 through 2012, the Unit reported recoveries of $144 million, 64 convictions, and 53 civil judgments and settlements. The Unit maintained proper fiscal control of its resources. Most Unit case files contained documentation of supervisory approval to close cases; however, 21 percent of case files lacked documentation of supervisory approval to open cases, and 67 percent lacked documentation of periodic supervisory reviews. In addition, the Unit did not refer sentenced individuals to OIG for program exclusion within an appropriate timeframe. The Unit's policies and procedures manual was not updated to reflect current Unit operations. Finally, the Unit's memorandum of understanding (MOU) with Michigan's State Medicaid agency-the Department of Community Health (DCH)-did not reflect current law and practice as required.


We recommend that the Michigan Unit (1) ensure that supervisory approval to open cases and periodic supervisory reviews are documented in Unit case files, (2) ensure that it refers individuals for exclusion to OIG within an appropriate timeframe, (3) revise its policies and procedures manual, and (4) revise its MOU with DCH. The Unit concurred with all four of our recommendations.