In the wake of the Fraud Enforcement and Recovery Act of 2009 (FERA), which was enacted by Congress on May 20, 2009 and expands the federal False Claims Act, the Louisiana Department of Health and Hospitals (“DHH”) announced on October 29, 2009, a new fraud initiative against agencies who deliver in-home direct care to Medicaid beneficiaries.  DHH is partnering with the Louisiana Attorney General’s office to audit of all Medicaid in-home direct care providers. DHH will engage the services of six (6) audit firms to perform the audits.  Any potential fraud or abuse identified by the auditors will be reported to the Attorney General for prosecution. Funding for these audits will be provided by a $3,000,000.00 fund created with dollars previously recovered from fraudulent providers.

What prompted the initiative was a sample audit of in-home direct care providers conducted by DHH in the spring of 2009 for services provided form 2007 to 2008, which resulted in a 23% potential overpayment rate.  According to DHH, there are more than 700 agencies that provide in-home direct care services and over $673,000,000.00 was paid by DHH in claims for fiscal year 2009.  Some of the in-home direct care programs subject to audits include: the New Opportunities Waiver; the Elderly and Disabled Adults Waiver; Long Term Personal Care Services; EPSDT Personal Care Service, and Children’s Choice. Because DHH intends to audit all in-home direct care service providers, such Medicaid providers may want to consider conducting their own self-audit to ensure compliance with all state and federal regulations.

To read the DHH news release on the Medicaid fraud audits, click here.