Michigan Medicaid Fraud Control Unit: 2021 Review
WHY WE DID THIS STUDY
OIG administers the Medicaid Fraud Control Unit (MFCU or Unit) grant awards, annually recertifies the Units, and oversees the Units' performance in accordance with the requirements of the grant. As part of this oversight, OIG conducts periodic reviews of Units and prepares public reports based on on these reviews. OIG conducted this review of the Michigan MFCU to examine three areas of concern that we identified during our ongoing administration and oversight activities of the Michigan MFCU: (1) the number of fraud referrals from the State Medicaid agency, (2) the Unit's fiscal controls, and (3) the Unit's staffing levels. As part of this review, we also examined the Unit's performance and operations.
HOW WE DID THIS STUDY
OIG conducted the review of the Michigan MFCU in September 2021. Our review covered the 3-year period of FYs 2018-2020. We based the review on an analysis of data and information from 7 sources: (1) Unit documentation; (2) financial documentation; (3) structured interviews with key stakeholders; (4) structured interviews with Unit management and selected staff; 
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(5) a random sample of 90 case files from the Unit's 493 nonglobal case files that were open at any point during the review period; (6) a review of convictions submitted to OIG for program exclusion and adverse actions submitted to the National Practitioner Data Bank during the review period; and (7) an onsite review of Unit operations.
WHAT WE FOUND
We found that the Unit reported strong case outcomes for FYs 2018-2020, with over $47 million in combined criminal and civil recoveries. However, we identified several operational challenges that warrant further attention. We made nine findings for which we are making recommendations to improve the Unit's adherence to the MFCU performance standards. We found that (1) the Unit received few fraud referrals from the State Medicaid agency, and despite the Unit taking steps to increase these referrals, they remained low; (2) the Department of Attorney General repeatedly submitted the MFCU's financial reports late, lacked support for some MFCU expenditures, and lacked accounting procedures, raising concerns about the MFCU's fiscal controls; (3) despite the Unit's request for additional resources to increase its staffing levels, Unit staffing remained constant and did not align with the growing Medicaid expenditures; (4) although the Unit coordinated with Federal partners, it worked few joint cases with them, missing opportunities for sharing resources and training; (5) the Unit did not always report convictions or adverse actions to Federal partners within the appropriate timeframes;
(6) 62 percent of the Unit's case files lacked documentation of periodic supervisory reviews; (7) although the Unit maintained an annual training plan for its staff, Unit supervisors did not consistently track or verify that staff documented their training; (8) the Unit's case management system made it difficult for Unit staff to retrieve case information and performance data; and (9) the Unit's memorandum of understanding (MOU) with the State Medicaid agency did not reflect current practice or law.
WHAT WE RECOMMEND
To address the findings and further improve Unit operations, we recommend that the Unit
(1) build upon its efforts to increase fraud referrals from the State Medicaid agency; (2) refund the Federal grant for unsupported expenditures and establish processes to ensure Unit involvement and oversight of fiscal controls and reporting; (3) assess the adequacy of existing staffing levels and, if appropriate, develop a plan to expand the size of the Unit; (4) seek opportunities, as appropriate, to investigate more joint cases with Federal partners; (5) develop and implement processes to ensure that all convictions and adverse actions are reported to Federal partners within the appropriate timeframes; (6) ensure that supervisory reviews of case files are documented in accordance with Unit policy; (7) ensure that Unit supervisors track and verify that all staff in professional disciplines document their training; (8) implement a new, comprehensive case management system that allows for efficient access to case documents and information; and (9) revise its MOU with the State Medicaid agency to reflect current practice and law. The Unit concurred with all nine recommendations.