Abstract
Medicaid Fraud Control Units investigate and prosecute acts of financial fraud and patient abuse within the program. Prior to the expansion of Medicaid under the Affordable Care Act (ACA), federal government MFCU expenditures totaled half a percent of Medicaid expenditures. Following the enrollment of 12 million adults into the Medicaid program under the ACA, expenditures for these units are now less than pre-ACA levels, as a share of program expenses. We use data for states’ fraud enforcement efforts in the period 2010–2018 and a difference-in-differences design that exploits states’ decision to expand Medicaid under the ACA. States that did expand Medicaid increased their fraud investigations, compared to states that did not expand. Further, civil recoveries and excluded individuals increased after the Medicaid expansion. We find evidence that increases in program scale, in terms of enrollment and utilization, reverted to the mean, facilitating the identification of outlier provider behavior.
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Notes
National Federation of Independent Business v. Sebelius.
Total recoveries are available in the period 2006 to 2018.
Our dataset does not include North Dakota, as this state does not operate an MFCU or provide information about Medicaid fraud enforcement, hence our panel dataset is composed by 50 states.
The number of reported actions omit the number of incoming tips.
The total amount of excluded individuals in the time frame of our sample was 39,582.
Ten states carried out considerable expansions prior to 2014. In the robustness section we explore the sensitivity of our results to excluding these early expansion states.
The treated states are the 33 states that expanded Medicaid after the ACA.
“(1) An action taken against a practitioner’s clinical privileges or medical staff membership in a health care organization, (2) a licensure disciplinary action, (3) a Medicare/Medicaid Exclusion action, or (4) any other adjudicated action." NPDB website.
A MMPR is “The format used by medical malpractice payers to report a medical malpractice payment made for the benefit of a physician, dentist, or other health care practitioner." A medical malpractice payment is "A monetary exchange as a result of a settlement or judgment of a written complaint or claim demanding payment based on a physician’s, dentist’s, or other licensed health care practitioner’s provision of or failure to provide health care services; and may include, but is not limited to, the filing of a cause of action, based on the law of tort, brought in any state or Federal Court or other adjudicative body." NPDB website.
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Victoria Perez and Julio A. Ramos Pastrana have benefited from valuable comments received in ASHECON 2021. We thank Laura Wherry for very helpful comments. The usual disclaimer applies.
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Perez, V., Ramos Pastrana, J.A. Finding fraud: enforcement, detection, and recoveries after the ACA. Int J Health Econ Manag. 23, 393–409 (2023). https://doi.org/10.1007/s10754-023-09357-w
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DOI: https://doi.org/10.1007/s10754-023-09357-w