Department of Health and Human Services 
OFFICE OF 
 
INSPECTOR GENERAL 
 
 
 
 
 
 
 
 
L   S M
OUISIANA  TATE  EDICAID 
 
F C U :  
  RAUD  ONTROL  NIT  
 
2012 O R  
  NSITE  EVIEW
 
 
 
 
 
 
 
 
 
Stuart Wright 
Deputy Inspector General for 
Evaluation and Inspections 
 
December 2012 
OEI-09-12-00010   
   
LOUISIANA STATE MEDICAID FRAUD CONTROL UNIT:  
2012 ONSITE REVIEW 
OEI-09-12-00010 
 
WHY WE DID THIS STUDY  
The Office of Inspector General (OIG) oversees all Medicaid Fraud Control Units 
(MFCU or Unit) with respect to Federal grant compliance.  As part of this oversight, 
OIG reviews all Units.  These reviews assess Unit performance in accordance with the 
12 MFCU performance standards and monitor Unit compliance with Federal grant 
requirements. 
HOW WE DID THIS STUDY 
We reviewed data from seven sources:  (1) a review of documents, policies, and 
procedures related to the Units 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 Units management; (6) an onsite review of 
case files; and (7) an onsite review of Unit operations. 
WHAT WE FOUND 
From fiscal year (FY) 2009 through FY 2011 (our period of review), the Unit reported 
recoveries of $95 million, obtained 192 convictions and 86 civil judgments or 
settlements, and received 1,043 referrals.  Provider fraud referrals to the Unit increased 
and the Unit received patient abuse and neglect referrals from a variety of sources.  All 
reviewed Unit case files contained documentation indicating supervisory approval to 
open cases, and 94 percent of closed case files contained documentation indicating 
supervisory approval to close cases.  Twenty-two percent of the Unit case files lacked 
documentation indicating at least one supervisory review and 28 percent lacked 
documentation indicating additional, periodic supervisory review.  The Unit did not refer 
14 percent of sentenced providers to OIG for program exclusion within the appropriate 
timeframe.  The Unit had not updated its memorandum of understanding (MOU) with the 
Louisiana Department of Health and Hospitals (DHH) to reflect current law and practice.  
The Unit maintained proper fiscal control of its resources; however, it did not report 
program income properly in FYs 2010 and 2011.  Except for not reporting all of its 
program income, we found no evidence of Unit noncompliance with applicable laws, 
regulations, and policy transmittals. 
WHAT WE RECOMMEND 
We recommend that the Louisiana Unit:  (1) revise its policies and procedures to ensure 
that periodic supervisory reviews are documented in Unit case files, (2) ensure that letters 
referring providers for exclusion are submitted to OIG within the appropriate timeframe, 
(3) revise its MOU with DHH to reflect current law and practice, and (4) ensure that all 
program income is reported properly on its Federal Financial Status Reports.  The Unit 
concurred with all but the first of our four recommendations.  However, the Unit is 
nevertheless implementing new procedures to ensure that case files include 
documentation of all future supervisory reviews.   
 
   
TABLE OF CONTENTS 
Objective ......................................................................................................1 
Background ..................................................................................................1 
Methodology ................................................................................................5 
Findings........................................................................................................8 
From FY 2009 through FY 2011, the Unit reported recoveries       
of $95 million and obtained 192 convictions and 86 civil 
judgments or settlements..................................................................8 
From FY 2009 through FY 2011, provider fraud referrals to the 
Unit increased by 21.4 percent and the Unit received patient   
abuse and neglect referrals from a variety of sources ......................8 
All reviewed case files contained documentation indicating 
supervisory approval to open cases and 94 percent of closed      
case files contained documentation indicating supervisory  
approval to close cases ...................................................................10 
Twenty-two percent of the total Unit case files lacked 
documentation indicating at least one supervisory review and 
28 percent lacked documentation indicating additional,       
periodic supervisory reviews .........................................................10 
The Unit did not refer 14 percent of sentenced providers to          
OIG for program exclusion within the appropriate timeframe ...... 11 
The Unit had not updated its MOU with DHH to reflect        
current law and practice ................................................................. 11 
The Unit maintained proper fiscal control of its resources,           
but did not report program income properly in FYs 2010             
and 2011 .........................................................................................12 
Conclusion and Recommendations ............................................................13 
Unit Comments and Office of Inspector General Response ..........15 
Appendixes ................................................................................................16 
A:  Performance Standards for Medicaid Fraud Control Units .....16 
B:  Referrals of Provider Fraud and Patient Abuse and Neglect     
to the Medicaid Fraud Control Unit by Source, Fiscal Years         
2009 through 2011 .........................................................................20 
C:  Investigations Opened and Closed by Provider Category       
and Case Type, Fiscal Years 2009 through 2011 ...........................21 
D:  Case File Review Population, Sample Size Counts, and 
Confidence Interval Estimates .......................................................23  
E:  Unit Comments.........................................................................25 
Acknowledgments......................................................................................30 
   
   
OBJECTIVE 
To conduct an onsite review of the Louisiana State Medicaid Fraud 
Control Unit (MFCU or Unit). 
BACKGROUND 
The mission of State MFCUs, as established by Federal statute, is to 
investigate and prosecute Medicaid provider fraud and patient abuse and 
neglect under State law.1  Pursuant to Title XIX of the SSA, each State 
must maintain a certified Unit unless the Secretary of Health and Human 
Services (HHS) determines that operation of a Unit would not be 
cost-effective because (1) minimal Medicaid fraud exists in that State; and 
(2) the State has other, adequate safeguards to protect Medicaid 
beneficiaries from abuse and neglect.2  Currently, 49 States and the 
District of Columbia (States) have created such Units.3  In fiscal year 
(FY) 2011, combined Federal and State grant expenditures for the Units 
totaled $208.6 million, of which Federal funds represented 
$156.7 million.4  That year, the 50 MFCUs employed 1,833 individuals.  
Each Unit must employ an interdisciplinary staff that consists of at least an 
investigator, an auditor, and an attorney to carry out its duties and 
responsibilities in an effective and efficient manner.5  The staff reviews 
complaints provided by the State Medicaid agency and other sources and 
determines their potential for criminal prosecution and/or civil action.  
Collectively, in FY 2011, the 50 Units reported 1,230 convictions and 
906 civil settlements or judgments.  That year, the Units reported 
recoveries of approximately $1.7 billion.6, 7  
Units are required to have either statewide authority to prosecute cases or 
formal procedures to refer suspected criminal violations to an office with 
such authority.8  In Louisiana and 43 other States, the Units are located  
 
1 Social Security Act (SSA)  1903(q).  
2 SSA  1902(a)(61).  Regulations at 42 CFR  1007.11(b)(1) add that the Units 
responsibilities may include reviewing complaints of misappropriation of patients 
private funds in residential health care facilities. 
3 North Dakota and the territories of American Samoa, Guam, the Northern Mariana 
Islands, Puerto Rico, and the U.S. Virgin Islands have not established Units. 
4 In this report, fiscal year refers to the Federal FY (October 1 through September 30). 
5 SSA  1903(q)(6) and 42 CFR 1007.13. 
6 Office of Inspector General (OIG), State Medicaid Fraud Control Units Fiscal Year 
2011 Grant Expenditures and Statistics.  Accessed at http://oig.hhs.gov/fraud/medicaid-
fraud-control-units-mfcu/ on April 16, 2012. 
7 Pursuant to 42 CFR  1007.17, Units report the total amount of recovered funds in their 
annual reports to OIG.   
8 SSA  1903(q)(1).  
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  1 
   
   
within offices of State Attorneys General that have this authority.  In the 
remaining six States, the Units are located in other State agencies;9 
generally, such Units must refer cases to other offices with prosecutorial 
authority.  Additionally, each Unit must be a single identifiable entity of 
State government, distinct from the State Medicaid agency, and each Unit 
must develop a formal agreement (e.g., a memorandum of understanding 
(MOU)) that describes the Units relationship with that agency.10  
Oversight of the MFCU Program 
The Secretary of HHS delegated to OIG the authority to both annually 
certify the Units and administer grant awards to reimburse States for a 
percentage of their costs in operating them.11  All Units are currently funded 
by the Federal Government on a 75-percent matching basis, with the States 
contributing the remaining 25 percent.12  To receive Federal reimbursement, 
each Unit must submit an initial application to OIG.13  OIG reviews the 
application and notifies the Unit if the application is approved and the Unit 
is certified.  Approval and certification are valid for a 1-year period; the Unit 
must be recertified each year thereafter.14   
Pursuant to Title XIX of the SSA, States must operate Units that effectively 
carry out their statutory functions and meet program requirements.15  
OIG developed and issued 12 performance standards to define further the 
criteria that OIG applies in assessing whether a Unit is effectively carrying 
out statutory functions and meeting program requirements.16  Examples 
include maintaining an adequate caseload through referrals from several   
sources, maintaining an annual training plan for all three of the professional 
disciplines (auditors, investigators, and attorneys), and establishing policy 
and procedures manuals to reflect the Units operations.  See Appendix A for 
a complete list of the performance standards. 
 
9 In those States with a Unit, the Unit shares responsibility for protecting the integrity of 
the Medicaid program with the section of the State Medicaid agency that functions as the 
Program Integrity Unit.  Some States also employ a Medicaid Inspector General who 
conducts and coordinates fraud, waste, and abuse activities for the State agency. 
10 SSA  1903(q)(2) and 42 CFR  1007.9(d). 
11 The portion of funds reimbursed to States by the Federal Government for its share of 
expenditures for the Federal Medicaid program, including the MFCUs, is called Federal 
Financial Participation. 
12 SSA  1903(a)(6)(B). 
13 42 CFR  1007.15(a). 
14 42 CFR  1007.15(b) and (c). 
15 SSA  1902(a)(61). 
16 59 Fed. Reg. 49080 (Sept. 26, 1994).  Accessed at http://oig.hhs.gov on November 22, 
2011.  Since the time of our review, OIG has published a revision of the performance 
standards, 77 Fed. Reg. 32645 (June 1, 2012). 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  2 
   
   
Louisiana Unit  
The Unit is an autonomous entity within the Louisiana Department of 
Justices Criminal Division and has the authority to prosecute Medicaid 
fraud and patient abuse and neglect cases.  At the time of our review 
(February 2012), the Unit had 53 employees50 located in the State 
capital of Baton Rouge, and 1 investigator located in each of 3 satellite 
offices. Unit investigators generally are assigned to one of five teams; 
each team has a senior investigator as team leader.  Noninvestigative 
personnel may be assigned to a team and/or work with multiple teams, 
according to need. 
The Unit receives provider fraud referrals from the State Medicaid 
agencyLouisiana Department of Health and Hospitals (DHH)and 
from Federal sources, such as OIG.  The Unit receives patient abuse and 
neglect referrals from DHH and the State Long-Term Care Ombudsman.  
The Unit receives referrals of both types from various law enforcement 
agencies and other State and local sources, such as health care providers 
and the State survey and certification agency.  From FY 2009 through 
FY 2011, the Unit received an average of 348 referrals (see Appendix B).  
The Unit reviews each referral and opens a case if management 
determines the referral appears to have the potential for criminal or civil 
prosecution and/or collection. 
After Unit management assigns an investigator to an opened case, the 
investigator gathers background data and presents the case to the Unit 
Director and Chief Investigator, who collectively decide whether to 
proceed with the investigation or refer the case to another agency.  From 
FY 2009 through FY 2011, the Unit opened an average of 348 cases 
annuallyan average of 170 provider fraud and 178 patient abuse and 
neglect cases.17  For additional information on the Units opened and 
closed investigations, including a breakdown by case type and provider 
category, see Appendix C. 
The Unit may open a case and pursue it through a variety of actions, 
including criminal prosecution, civil action, or a combination of the two.  
The Unit may close a case for a variety of reasons, including, but not 
limited to, resolving it through criminal or civil action or referring it to 
another agency.  From FY 2009 through FY 2011, the Unit closed an 
average of 357 cases annuallyan average of 149 provider fraud and 
208 patient abuse and neglect cases.18  From FY 2009 through 
 
17 Averages are rounded to the nearest whole number.  The Unit occasionally will open 
cases that were not formally referred by another agency.  For example, a case may be 
brought to the Units attention by the media.   
18 OIG analysis of Unit Quarterly Statistical Reports, FYs 2009 through 2011.  The 
number of closed cases includes multiple cases that were opened before FY 2009.                            
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  3 
   
   
FY 2011, the Unit obtained an annual average of 64 convictions and 
closed an annual average of 29 cases through civil action (Table 1).  
Table 1:  Louisiana Unit Convictions and Civil Judgments or Settlements, 
FY 2009 Through FY 2011 
Annual 
FY 2009  FY 2010  FY 2011  Total 
  Average 
Convictions*  56  70  66  192  64 
Civil Judgments or Settlements  31  25  30  86  29 
Source:  OIG analysis of Unit data and Quarterly Statistical Reports, FYs 2009 through 2011. 
*Convictions are reported to OIG at the time of sentencing.  The total number of convictions does not include 
15 convictions because those defendants were not sentenced until after our period of review (i.e., after FY 2011).   
One of the Units attorneys serves as an intake attorney on qui tam 
(whistleblower) cases for the National Association of Medicaid Fraud 
Control Units (NAMFCU).19  The Unit Director and Chief Investigator 
have both participated as speakers and organizers of NAMFCU training 
sessions, and the Chief Investigator served on NAMFCUs Training 
Committee for several years.  Unit investigators and attorneys directly 
participated in several globali.e., multi-Statecases for NAMFCU 
during the review period. 
Previous Review 
In 2007, OIG conducted an onsite review of the Louisiana Unit and found 
that (1) Unit employees worked in a non-MFCU capacity without 
OIG approval and (2) MFCU grant funds were used to purchase vehicles 
that were improperly placed under the control of another division of the 
Louisiana Department of Justice and were used for non-MFCU activities.  
Unit management responded that Unit employees had only worked de 
minimus in a non-MFCU capacity and stated that it would remind Unit 
employees of the pertinent regulations.  The vehicles in question were 
transferred to Unit control and the Federal Government was reimbursed 
for related unallowable expenses.  Our 2012 onsite review of the Unit 
found no indication that either issue persisted. 
 
19 The intake attorney monitors qui tam cases and reports on their status to NAMFCU. 
NAMFCU is a voluntary association of all 50 Units.  Among other services it provides 
training opportunities and facilitates the settlement of global civil false claims cases 
involving the U.S. Department of Justice and other State MFCUs.  More information on 
NAMFCU and its involvement in global cases is available online at 
http://www.namfcu.net. 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  4 
   
   
 
METHODOLOGY 
We analyzed data from seven sources:  (1) a review of documentation, 
policies, and procedures related to the Units operations, staffing, and 
caseload for FYs 2009 through 2011; (2) a review of financial 
documentation for FYs 2009 through 2011; (3) structured interviews with 
key stakeholders; (4) a survey of Unit staff; (5) structured interviews with 
the Units management; (6) an onsite review of case files that were open 
in FYs 2009 through 2011; and (7) an onsite review of Unit operations.  
We analyzed data from all seven sources to describe the caseload and 
assess the performance of the Unit.  We also analyzed the data to identify 
any opportunities for improvement and any instances in which the Unit 
did not meet the performance standards or was not operating in 
accordance with laws, regulations, and policy transmittals.20  In addition, 
we noted any practices that appeared to benefit the Unit.  We based these 
observations on statements from Unit staff, data analysis, and our own 
judgment.  We did not independently verify the effectiveness of these 
practices, but included the information because it may be useful to other 
Units in their operations. 
Data Collection and Analysis 
Review of Unit Documentation.  We requested and reviewed 
documentation, policies, and procedures related to the Units operations, 
staffing, and cases, including its annual reports, quarterly statistical 
reports, and responses to recertification questionnaires.  We also requested 
and reviewed the Units data describing how it investigates and prosecutes 
Medicaid cases.  Data collected included information such as the number 
of referrals received by the Unit and the number of investigations opened 
and closed.   
Review of Financial Documentation.  To evaluate internal controls, we 
reviewed policies and procedures related to budgeting, accounting 
systems, cash management, procurement, property, and personnel.  We 
obtained from the Unit its claimed grant expenditures for 
FYs 2009 through 2011 to:  (1) review final Federal Status Reports21 and 
supporting documentation, (2) select and review transactions within direct 
cost categories to determine if costs were allowable, and (3) verify that 
indirect costs were accurately computed using the approved indirect cost 
rate.  Finally, we reviewed records in the HHS Payment Management 
 
20 All relevant regulations, statutes, and policy transmittals are available online at 
http://oig.hhs.gov.  
21 The Unit transmits financial status reports to OIGs Office of Management and Policy 
on a quarterly and annual basis.  These reports detail Unit income and expenditures. 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  5 
   
   
System (PMS)22 and revenue accounts to identify any unreported program 
income.23 
Interviews With Key Stakeholders.  We conducted structured interviews 
with eight individual stakeholders among five agencies who were familiar 
with Unit operations.  Specifically, we interviewed DHHs Director of 
Program Integrity; the former State Long-Term Care Ombudsman; two 
Assistant U.S. Attorneys based in Baton Rouge; the Louisiana Department 
of Justices Criminal Division Supervisor; two OIG Special Agents based 
in Louisiana; and an Assistant Special Agent in Charge for OIGs 
Region VI, which includes Louisiana.24  These interviews focused on the 
Units interaction with external agencies, Unit operations, opportunities 
for improvement, and any practices that appeared to benefit the Unit and 
that may be useful to other Units in their operations. 
Survey of Unit Staff.  We conducted an electronic survey of all             
nonmanagerial Unit staff.  We requested and received responses from each 
of the 50 nonmanagerial staff members, for a 100-percent response rate.25  
Our questions focused on operations of the Unit, opportunities for 
improvement, and practices that appeared to benefit the Unit and that may 
be useful to other Units in their operations.  The survey also sought 
information about the Units compliance with applicable laws, regulations, 
and policy transmittals.   
Interviews With Unit Management.  We conducted structured interviews 
with the Units director (chief attorney), deputy director (chief 
investigator), and auditor.  We asked these managers to provide us with 
additional information necessary to better understand the Units 
operations, identify opportunities for improvement, identify practices that 
appeared to benefit the Unit and that may be useful to other Units in their 
operations, and clarify information obtained from other data sources. 
Onsite Review of Case Files.  We selected a simple random sample of      
100 case files from the 1,472 cases26 that were open at any point from 
FY 2009 through FY 2011.  The design of this sample allowed us to 
 
22 The PMS is a grant payment system operated and maintained by the HHS Program 
Support Center, Division of Payment Management.  The PMS provides disbursement, 
grant monitoring, reporting, and cash management services to awarding agencies and 
grant recipients, such as Units. 
23 Program income is defined as gross income received by the grantee or subgrantee 
directly generated by a grant supported activity, or earned only as a result of the grant 
agreement during the grant period.  45 CFR  92.25(b). 
24 The Criminal Division Supervisor supervises the Unit Director. 
25 This report uses the terms management and supervisors interchangeably.  
Nonmanagement employees are Unit staff members who have no supervisory 
authority. 
26 This figure includes cases opened before FY 2009 that remained open at some point 
during FYs 20092011. 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  6 
   
   
estimate the proportion of all 1,472 case files with certain characteristics 
+/- 10 percent at the 95-percent confidence level.  We reviewed these 
100 sampled case files and the Units processes for monitoring the status 
and outcomes of cases.  From these 100 case files, we selected another 
simple random sample of 50 for a more in-depth review of potential 
issues.  This second-phase sample of 50 cases allowed us to conduct a 
more comprehensive review to identify other potential issues from a 
qualitative perspective.  For population and sample size counts, as well as 
confidence interval estimates, see Appendix D. 
Onsite Review of Unit Operations.  While onsite, we reviewed the Units 
operations.  Specifically, we observed intake of referrals, data analysis 
operations, security of data and case files, and the general functioning of 
the Unit.  
Standards 
This study was conducted in accordance with the Quality Standards for 
Inspection and Evaluation issued by the Council of the Inspectors General 
on Integrity and Efficiency.27 
 
27 Full text of these standards is available online at http://www.ignet.gov/pande/ 
standards/oeistds11.pdf.  
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  7 
   
   
FINDINGS 
From FY 2009 through FY 2011, the Unit reported 
recoveries of $95 million and obtained 
192 convictions and 86 civil judgments or settlements 
The Unit reported recoveries of $95 million from FY 2009 through 
FY 2011an average of $31.7 million annually (see Table 2).  Of the 
$95 million in recoveries, the Unit attributed $82 million to civil 
recoveries and $13 million to criminal recoveries.  The Units annual 
average expenditures for FYs 2009 through 2011 were $4.6 million.28   
Table 2:  Louisiana MFCU Recovered Funds, FYs 2009 through 2011 
Total  Annual 
FY 2009  FY 2010  FY 2011 
  Recoveries  Average 
Reported 
Criminal  $2,192,365  $4,959,531  $5,748,227  $12,900,123  $4,300,041 
Recoveries 
Reported Civil 
$8,948,818  $52,645,597  $20,576,309  $82,170,724  $27,390,241 
Recoveries 
Total Reported 
$11,141,183  $57,605,128  $26,324,536  $95,070,847  $31,690,282 
Recoveries 
Total 
$4,399,538  $4,616,945  $4,752,048  $13,768,531  $4,589,510 
Expenditures 
Source:  OIG analysis of Unit data and Quarterly Statistical Reports, FYs 2009 through 2011. 
From FY 2009 through FY 2011, the Unit obtained 192 convictions and 
86 civil judgments or settlementsan average of 64 convictions and 
29 civil judgments or settlements annually.  The Units total reported 
recoveries increased by 417 percent from FY 2009 through FY 2010 and 
by 136 percent over the review period as a whole.29  The Units reported 
criminal recoveries increased by 162 percent over the review period.   
From FY 2009 through FY 2011, provider fraud 
referrals to the Unit increased by 21.4 percent and the 
Unit received patient abuse and neglect referrals from 
a variety of sources 
According to Performance Standard 4, a Unit should ensure that it 
maintains an adequate workload through referrals from the State 
Medicaid agency and other sources.  Total provider fraud referrals to the 
Unit increased from 145 in FY 2009 to 176 in FY 2011an increase of 
21.4 percent over the review period.  From FY 2009 through FY 2011, the 
Unit received 1,043 total referralsan average of 348 annually.  Of these, 
504 (48 percent) were related to provider fraudan average of 
 
28 The figures presented in this paragraph are rounded.   
29 A significant portion of the increase in FY 2010 was due to a large global settlement. 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  8 
   
   
168 annually.  Of the 1,043 total referrals, 539 (52 percent) were related to 
patient abuse and neglectan average of 180 annually.   
Six of eight interviewed individual stakeholders reported that the Units 
collaborative working relationships with outside agencies benefitted the 
Units overall production and increased the number of referrals it received 
during the review period.  In addition, both the Unit Director and the 
DHH Program Integrity Director reported that the great working 
relationship between the Unit and DHH benefitted the Unit by ensuring a 
consistent number of referrals.  According to Unit management and 
OIG staff who work with the Unit, the Units relationship with OIG also 
benefitted Unit performance, as demonstrated by the 42 provider fraud 
referrals the Unit received from OIG during the review period.     
The Unit received patient abuse and neglect referrals from a 
variety of sources 
According to Performance Standard 4(d), a Unit should ensure that it 
receives adequate patient abuse and neglect referrals from a variety of 
sources.30  During the review period, 8 sources each referred 10 or more 
patient abuse and neglect complaints to the Unit.  Of the 539 patient abuse 
and neglect referrals received by the Unit, 156 (29 percent) were referred by 
DHH, 141 (26 percent) by health care providers, and 135 (25 percent) by 
the State survey and certification agencythe Health Standards Section of 
DHH.   
Provider Outreach Program.  Unit management and a few staff indicated 
that the Units outreach program to providers and provider trainees 
benefitted the Units performance by generating a high number of provider 
referrals and promoting fraud and abuse/neglect deterrence.  The outreach 
program consists of statewide visits by Unit presenters to inform providers 
and provider trainees of the States mandatory abuse/neglect reporting rule, 
describe the various types of fraud and abuse/neglect, discuss Federal and 
State laws regarding fraud and abuse/neglect, and provide Unit contact 
information for the reporting of Medicaid-related crime.  According to Unit 
staff, the outreach program is very successful and providers frequently ask 
the Unit to present its program annually.  One Unit staff member noted that 
the outreach program gets our names and faces out [across the State] and it 
has proven to be fruitful.  I, personally, have had calls from [provider] 
employees who sat through [an outreach presentation] and wanted to report 
something to me later.       
 
 
30 For a breakdown of referral sources, see Appendix B, Table B-2. 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  9 
   
   
All reviewed case files contained documentation 
indicating supervisory approval to open cases and 
94 percent of closed case files contained 
documentation indicating supervisory approval to 
close cases 
According to Performance Standard 6(b), Unit supervisors should approve 
the opening and closing of cases to help ensure a continuous case flow and 
the timely completion of cases.  Supervisory approval to open and close 
cases demonstrates that Unit supervisors are monitoring the intake of cases 
and the timeliness of case resolutions, thereby promoting the efficiency 
and effectiveness of Unit staff.  The Unit documented supervisory 
approval to open cases in all 100 reviewed case files31 and to close cases in 
94 percent of closed case files. 
Twenty-two percent of the total Unit case files lacked 
documentation indicating at least one supervisory 
review and 28 percent lacked documentation 
indicating additional, periodic supervisory reviews 
According to Performance Standard 6(c), supervisory reviews should be 
conducted periodically and noted in the case file to ensure timely case 
completion.32  Twenty-two percent of Unit case files lacked 
documentation indicating at least one supervisory review and 28 percent 
of the total case files lacked documentation of additional, periodic 
supervisory reviews.33  Of the 28 case files in our sample lacking 
documentation indicating periodic supervisory reviews, 11 (39 percent) 
indicated that the cases were open for more than a year.34  Four of these 
28 case files (14 percent) indicated that the cases were open for 3 or more 
years.  Of these 28 cases, 25 were criminal (16 involved provider fraud 
and 9 involved patient abuse or neglect) and 3 were civil.  
Unit management explained that they frequently review cases through 
informal conversations that are not always documented in the case files.  
In addition, the Unit Director and Chief Investigator conduct formal case 
status reviews of every open case with senior investigators on a quarterly 
 
31 Although we cannot conclude that all 1,472 case files contained documentation 
indicating supervisory approval to open cases, we are 95-percent confident that between 
1,420 and 1,472 case files contain such documentation because the 95-percent confidence 
interval for this projection is 96.5100%. 
32 For the purposes of this report, supervisory approval to open and close a case does not 
constitute a case file review.  Periodic supervisory review indicates that a supervisor 
reviewed a case more than once between its opening and closing. 
33 Ten additional case files lacked documentation indicating periodic supervisory review.  
However, these case files were open for 3 months or less and may not have warranted 
periodic supervisory review. 
34 We were unable to confidently project these percentages to all 1,472 case files due to 
the small sample size. 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  10 
   
   
basis.  Since our onsite review, Unit management has mandated that Unit 
investigators complete a case file review checklist.  According to 
management, the checklist is used as a guide throughout the investigation 
and prosecution stages of cases to ensure that all pertinent documentation 
is included in Unit case files.  The Unit has documented these processes in 
its policies and procedures manual and provided us with a copy of both the 
checklist and the revised policies and procedures. 
The Unit did not refer 14 percent of sentenced 
providers to OIG for program exclusion within the 
appropriate timeframe 
According to Performance Standard 8(d), when a convicted provider is 
sentenced, the Unit should send a referral letter to OIG within 30 days or 
other reasonable time period for the purpose of program exclusion.35  The 
Unit referred 165 of 192 (86 percent) sentenced providers to OIG within the 
appropriate timeframe, and 27 (14 percent) of the sentenced providers 
outside the appropriate timeframe.  However, after our onsite review, the 
Unit referred these 27 sentenced providers to OIG for program exclusion.  
In addition, since our onsite review, the Unit has implemented new 
procedures to ensure that notification letters are sent to OIG for program 
exclusion within the appropriate timeframe.   
The Unit had not updated its MOU with DHH to reflect 
current law and practice 
According to Performance Standard 10, Units should periodically review 
their MOUs with the State Medicaid agencyDHHto ensure that they 
reflect current law and practice.  As required by Federal regulation, the Unit 
had an MOU with DHH.36  However, the MOU was not revised to reflect 
recent legal changes that allow the Unit to refer any provider under 
investigation of a credible fraud allegation to DHH for payment 
suspension.37  Although the Unit reported making referrals on the basis of 
credible fraud allegations, both Unit management and DHH officials stated 
that they are aware of the issue and will update the MOU to reflect the legal 
change.38   
 
35 Pursuant to 42 U.S.C.  1320a-7(a), OIG excludes from participation in Federal health 
care programs any person or entity convicted of a criminal offense related to the delivery 
of an item or service under the Medicaid program or to the neglect or abuse of patients in 
residential health care facilities.  No payment may be made by Medicaid, Medicare, or 
other Federal health care programs for an item or service provided, ordered, or prescribed 
by an excluded individual or entity.  42 CFR  1001.1901. 
36 42 CFR  1007.9(d). 
37 42 CFR  455.23 and 42 CFR  1007.9(e).   
38 Although we reviewed the MOU, we did not independently verify whether the Unit 
actually referred providers on the basis of a credible fraud allegation. 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  11 
   
   
The Unit maintained proper fiscal control of its 
resources, but did not report program income properly 
in FYs 2010 and 2011 
According to Performance Standard 11, the Unit Director should exercise 
proper fiscal control over the Units resources.  Control includes 
maintaining an equipment inventory, using generally accepted accounting 
principles, properly reporting program income, and conducting proper 
reporting between the Unit and its State parent agency.   
From FY 2009 through FY 2011, the Unit claimed expenditures that 
represented allowable costs in accordance with applicable Federal 
regulations.  In addition, the Unit maintained adequate internal controls 
relating to accounting, budgeting, personnel, procurement, property, and 
equipment.  However, the Unit did not report as program income     
$10,773 it received for investigative and legal costs incurred while 
investigating patient abuse and neglect cases in FYs 2010 and 2011.39  
According to OIG policy, any funds received by the Unitincluding 
reimbursements for expenses incurred during patient abuse and neglect       
investigationsthat meet the definition of program income40 must be 
reported on the Units Federal Financial Status Reports and deducted from 
total costs under the grant in accordance with Federal regulations.41  
Because the Unit did not follow OIG policy by reporting and deducting 
this program income, the Unit withdrew $8,080 more from the 
HHS Payment Management System than it was entitled to receive.42 
Since our review, the Unit has agreed to reimburse the overdrawn funds 
and has implemented procedures to ensure that future investigative and 
legal costs that meet the definition of program income will be properly 
reported on Federal Financial Status Reports and deducted from total costs 
under the grant. 
 
 
39 The Unit reports annual expenses and program income on its Federal Financial Status 
Reports to account for how much money the Unit draws down, or withdraws, as 
reimbursement from the PMS as Federal reimbursement for its annual operating costs.     
40 45 CFR  92.25(b); OIG State Fraud Policy Transmittal 10-01, Program Income 
(March 22, 2010). 
41 OIG State Fraud Policy Transmittal 10-01, Program Income (March 22, 2010). 
42 This amount represents the Federal share (75 percent) of the Units budget; in this case, 
$8,080 of the $10,773 total expenses.  The State is responsible for the remaining 
25 percent of the $10,773 total ($2,693).  OIG policy requires Units to deduct program 
income from their total costs under the grant, pursuant to 45 CFR  92.25(g)(1), thus 
making the 75-percent share unallowable.   
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  12 
   
   
CONCLUSION AND RECOMMENDATIONS 
From FY 2009 through FY 2011, the Unit obtained 192 convictions and 
86 civil judgments or settlements, received 1,043 referrals from DHH and 
a variety of other sources, and reported recoveries of $95 million.  
Provider fraud referrals received by the Unit increased by 21.4 percent 
during the review period, and the Unit received patient abuse and neglect 
referrals from a variety of sources.  Unit management, stakeholders, and 
staff indicated that the Units collaborative working relationships with 
outside agencies and its statewide provider outreach program were 
beneficial to increasing the number of provider fraud referrals the Unit 
received.  Unit case files consistently contained documentation indicating 
supervisory approval to open and close cases.  Finally, the Unit maintained 
proper control of its fiscal resources. 
Additional opportunities for improvement exist.  Specifically, 22 percent 
of the total Unit cases files lacked documentation indicating at least one 
supervisory review and 28 percent of case files lacked documentation 
indicating additional, periodic supervisory reviews.  Out of 192 sentenced 
providers in FYs 20092011, the Unit did not refer 27 (14 percent) to 
OIG for program exclusion within the appropriate timeframe.  In addition, 
the Units MOU with DHH was not updated to reflect recent legal 
changes.  Finally, the Unit did not report program income properly or 
deduct this from the total costs under its Federal grant in FYs 2010 and 
2011.  With the exception of not reporting and deducting all of its program 
income, we found no evidence of Unit noncompliance with applicable 
laws, regulations, and policy transmittals.  
Since the onsite review, the Unit has reported that it has implemented 
practices to improve its operations and performance, including mandating 
that Unit investigators complete a case file review checklist and 
ensuring that notification letters are sent to OIG for program exclusion 
within the appropriate timeframe.  The Unit has documented these 
processes in its policies and procedures manual and provided us with a 
copy of both the checklist and the revised policies and procedures. 
On the basis of these findings, we recommend that the Louisiana Unit: 
Revise Its Policies and Procedures To Ensure That Periodic 
Supervisory Reviews Are Documented in Unit Case Files 
Ensure That Letters Referring Providers for Exclusion Are 
Submitted to OIG Within the Appropriate Timeframe 
The Unit should ensure that letters referring providers for exclusion are 
sent within 30 days of defendant sentencing or another reasonable time 
period, as required by the performance standards. 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  13 
   
   
 
 
Revise Its MOU With DHH To Reflect Current Law and Practice 
The Unit should revise its MOU with DHH to specify that the Unit may 
refer any provider suspected of fraud for payment suspension to DHH and 
to describe the procedure for this type of referral. 
Ensure That All Program Income Is Reported Properly on Its 
Federal Financial Status Reports 
The Unit should report its program income according to guidelines set out 
in OIG State Fraud Policy Transmittal 10-01.  In addition, the Unit should 
reimburse OIG $8,080 for the unallowable HHS Payment Management 
System withdrawals in FYs 2010 and 2011. 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  14 
   
   
UNIT COMMENTS AND OFFICE OF INSPECTOR GENERAL 
RESPONSE 
The Unit concurred with all but the first of our four recommendations.  
Regarding our second recommendation, the Unit implemented new 
procedures to ensure that letters referring providers for exclusion are sent 
to OIG within the appropriate timeframe.  These new procedures include 
sending an automated case tracking system email to investigators and 
supervisors reminding them to send the appropriate referral letter to OIG 
upon the sentencing of a provider. 
Regarding our third recommendation, the Unit is reviewing the entire 
MOU with DHH and will revise it as needed.  The Unit and DHH will 
work to complete a revised MOU in 2013. 
Regarding our fourth recommendation, the Unit agreed to reimburse OIG 
for the overdrawn funds and has implemented new procedures to ensure 
that program income is properly reported on Federal Financial Status 
Reports and that the proper amount is withdrawn annually from the HHS 
Payment Management System. 
The Unit did not concur with our first recommendation, to revise its 
policies and procedures to ensure periodic supervisory reviews are 
documented in Unit case files.  Despite its nonconcurrence, the Unit is 
implementing new procedures to ensure that case files include 
documentation of all future supervisory reviews.  This new procedure 
directly addresses our recommendation.   
The full text of the Units comments is provided in Appendix E.  We did 
not make any changes to the report based on the Units comments. 
 
 
 
 
 
 
 
 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  15 
   
   
APPENDIX A 
Performance Standards for Medicaid Fraud Control Units 
(Unit)43  
1.  A Unit will be in conformance with all applicable statutes, 
regulations and policy transmittals.  In meeting this standard, the 
Unit must meet, but is not limited to, the following requirements: 
a.  The Unit professional staff must consist of permanent employees 
working full-time on Medicaid fraud and patient abuse matters. 
b.  The Unit must be separate and distinct from the State Medicaid 
agency. 
c.  The Unit must have prosecutorial authority or an approved formal 
procedure for referring cases to a prosecutor. 
d.  The Unit must submit annual reports, with appropriate 
certifications, on a timely basis. 
e.  The Unit must submit quarterly reports on a timely basis. 
f.  The Unit must comply with the Americans with Disabilities Act, 
the Equal Employment opportunity requirements, the Drug Free 
workplace requirements, Federal lobbying restrictions, and other 
such rules that are made conditions of the grant. 
2.  A Unit should maintain staff levels in accordance with staffing 
allocations approved in its budget.  In meeting this standard, the 
following performance indicators will be considered: 
a.  Does the Unit employ the number of staff that was included in the 
Unit's budget as approved by the Office of Inspector General 
(OIG)? 
b.  Does the Unit employ the number of attorneys, auditors, and 
investigators that were approved in the Unit's budget? 
c.  Does the Unit employ a reasonable size of professional staff in 
relation to the State's total Medicaid program expenditures?  
d.  Are the Unit office locations established on a rational basis and are 
such locations appropriately staffed? 
3.  A Unit should establish policies and procedures for its operations, 
and maintain appropriate systems for case management and case 
tracking.  In meeting this standard, the following performance 
indicators will be considered: 
 
43 59 Fed. Reg. 49080 (Sept. 26, 1994).  These performance standards were in effect at 
the time of our review and precede the performance standards published in June 2012. 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  16 
   
   
a.  Does the Unit have policy and procedure manuals? 
b.  Is an adequate, computerized case management and tracking 
system in place? 
4. A Unit should take steps to ensure that it maintains an adequate 
workload through referrals from the single State agency and other 
sources.  In meeting this standard, the following performance 
indicators will be considered: 
a.  Does the Unit work with the State Medicaid agency to ensure 
adequate fraud referrals? 
b.  Does the Unit work with other agencies to encourage fraud 
referrals? 
c.  Does the Unit generate any of its own fraud cases? 
d.  Does the Unit ensure that adequate referrals of patient abuse 
complaints are received from all sources? 
5.  A Units case mix, when possible, should cover all significant 
provider types.  In meeting this standard, the following performance 
indicators will be considered: 
a.  Does the Unit seek to have a mix of cases among all types of 
providers in the State? 
b.  Does the Unit seek to have a mix of Medicaid fraud and Medicaid 
patient abuse cases? 
c.  Does the Unit seek to have a mix of cases that reflect the 
proportion of Medicaid expenditures for particular provider 
groups? 
d.  Are there any special Unit initiatives targeting specific provider 
types that affect case mix? 
e.  Does the Unit consider civil and administrative remedies when 
appropriate? 
6.  A Unit should have a continuous case flow, and cases should be 
completed in a reasonable time.  In meeting this standard, the 
following performance indicators will be considered: 
a.  Is each stage of an investigation and prosecution completed in an 
appropriate time frame? 
b.  Are supervisors approving the opening and closing of 
investigations?  
c.  Are supervisory reviews conducted periodically and noted in the 
case file? 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  17 
   
   
7.  A Unit should have a process for monitoring the outcome of cases.  
In meeting this standard, the following performance indicators will be 
considered: 
a.  The number, age, and type of cases in inventory. 
b.  The number of referrals to other agencies for prosecution. 
c.  The number of arrests and indictments. 
d.  The number of convictions. 
e.  The amount of overpayments identified. 
f.  The amount of fines and restitution ordered. 
g.  The amount of civil recoveries. 
h.  The numbers of administrative sanctions imposed. 
8.  A Unit will cooperate with the OIG and other federal agencies, 
whenever appropriate and consistent with its mission, in the 
investigation and prosecution of health care fraud.  In meeting this 
standard, the following performance indicators will be considered: 
a.  Does the Unit communicate effectively with the OIG and other 
Federal agencies in investigating or prosecuting health care fraud 
in their State? 
b.  Does the Unit provide OIG regional management, and other 
Federal agencies, where appropriate, with timely information 
concerning significant actions in all cases being pursued by the 
Unit? 
c.  Does the Unit have an effective procedure for referring cases, 
when appropriate, to Federal agencies for investigation and other 
action? 
d.  Does the Unit transmit to the OIG, for purposes of program 
exclusions under section 1128 of the SSA, reports of convictions, 
and copies of Judgment and Sentence or other acceptable 
documentation within 30 days or other reasonable time period? 
9.  A Unit should make statutory or programmatic recommendations, 
when necessary, to the State government.  In meeting this standard, 
the following performance indicators will be considered: 
a.  Does the Unit recommend amendments to the enforcement 
provisions of the State's statutes when necessary and appropriate to 
do so? 
b.  Does the Unit provide program recommendations to single State 
agency when appropriate? 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  18 
   
   
c.  Does the Unit monitor actions taken by State legislature or State 
Medicaid agency in response to recommendations? 
10.  A Unit should periodically review its memorandum of 
understanding (MOU) with the State Medicaid agency and seek 
amendments, as necessary, to ensure it reflects current law and 
practice.  In meeting this standard, the following performance 
indicators will be considered: 
a.  Is the MOU more than 5 years old? 
b.  Does the MOU meet Federal legal requirements? 
c.  Does the MOU address cross-training with the fraud detection staff 
of the State Medicaid agency? 
d.  Does the MOU address the Units responsibility to make program 
recommendations to the Medicaid agency and monitor actions 
taken by the Medicaid agency concerning those recommendations? 
11. The Unit director should exercise proper fiscal control over the 
Unit resources.  In meeting this standard, the following performance 
indicators will be considered: 
a.  Does the Unit director receive on a timely basis copies of all fiscal 
and administrative reports concerning Unit expenditures from the 
State parent agency? 
b.  Does the Unit maintain an equipment inventory? 
c.  Does the Unit apply generally accepted accounting principles in its 
control of Unit funding? 
12. A Unit should maintain an annual training plan for all 
professional disciplines.  In meeting this standard, the following 
performance indicators will be considered: 
a.  Does the Unit have a training plan in place and funds available to 
fully implement the plan? 
b.  Does the Unit have a minimum number of hours training 
requirement for each professional discipline, and does the staff 
comply with the requirement? 
c.  Are continuing education standards met for professional staff? 
d.  Does the training undertaken by staff aid to the mission of the 
Unit? 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  19 
   
   
 APPENDIX B 
Referrals of Provider Fraud and Patient Abuse and Neglect to 
the Medicaid Fraud Control Unit by Source, Fiscal Years 
2009 through 2011 
Table B-1:  Total Medicaid Fraud Control Unit Fraud and Abuse Referrals 
and Annual Average 
 
Annual 
Case Type  FY 2009  FY 2010  FY 2011  3-Year Total 
Average 
Patient Abuse and Neglect  166  220  153  539  180 
Provider Fraud  145  183  176  504  168 
Total   311  403  329  1,043  348 
Source:  Office of Inspector General (OIG) analysis of Louisiana Medicaid Fraud Control Unit (Unit) Quarterly 
 
Statistical Reports, fiscal years (FY) 2009 through 2011.
 
Table B-2:  Unit Referrals, by Referral Source 
 
 
FY 2009  FY 2010  FY 2011 
   
Abuse  Abuse  Abuse  Percentage 
Referral 
Fraud  and  Fraud  and  Fraud  and  Total  of All 
Source 
Neglect  Neglect  Neglect  Referrals 
State 
Medicaid  89  41  85  88  93  27  423  40.6 
Agency 
Providers  4  51  6  61  7  29  158  15.2 
State 
Survey and  2  46  3  32  8  57  148  14.2 
Certification 
Other  33  13  35  11  37  4  133  12.8 
Private 
8  4  10  10  8  9  49  4.7 
Citizens 
OIG  0  1  34  0  8  0  43  4.1 
Law 
2  2  3  3  3  13  26  2.5 
Enforcement 
Other State 
2  6  2  8  3  0  21  2.0 
Agencies 
Licensing 
2  2  2  2  1  12  21  2.0 
Board 
Unit Hotline  0  0  3  5  4  0  12  1.2 
Outside 
2  0  0  0  3  1  6  0.6 
Prosecutors 
Long-Term 
Care  0  0  0  0  1  1  2  0.2 
Ombudsman 
Private 
Health  1  0  0  0  0  0  1  0.1 
Insurers 
Total  145  166  183  220  176  153  1,043  100 
Source:  OIG analysis of Unit Quarterly Statistical Reports, FYs 2009 through 2011.   
 
 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  20 
   
   
APPENDIX C 
Investigations Opened and Closed by Provider Category and 
Case Type, Fiscal Years 2009 through 2011 
Table C-1:  Total Annual Opened and Closed Investigations 
 
 
Case Type  FY 2009  FY 2010  FY 2011  3-Year Total  Annual Average 
Opened  312  404  327  1,043  348 
Patient Abuse and 
164  219  150  533  178 
Neglect 
Provider Fraud  148  185  177  510  170 
           
Closed  347  394  330  1,071  357 
Patient Abuse and 
236  220  167  623  208 
Neglect 
Provider Fraud  111  174  163  448  149 
Source:  Office of Inspector General (OIG) analysis of Louisiana Medicaid Fraud Control Unit (Unit) Quarterly 
Statistical Reports, fiscal years (FY) 2009 through 2011. 
 
Table C-2:  Total Investigations, by Case Type 
 
 
FY 2009  FY 2010  FY 2011 
Case Type 
Opened  Closed  Opened  Closed  Opened  Closed  Total 
Patient Abuse and 
164  236  219  220  150  166  1,155 
Neglect 
Provider Fraud  148  111  185  174  177  163  958 
Total   312  347  404  394  327  329  2,113 
   
Source:  OIG analysis of Unit Quarterly Statistical Reports, FYs 2009 through 2011.
 
Table C-3:  Patient Abuse and Neglect Investigations 
 
   
Provider  FY 2009  FY 2010  FY 2011 
Category 
     
  
Opened  Closed  Opened  Closed  Opened  Closed  Total 
Certified Nurse 
121  131  153  148  93  113  759 
Aides 
Other Providers  21  63  20  37  20  15  176 
Nurses/Doctors 
8  9  19  13  22  20  91 
Assistants 
Home Health 
9  20  8  6  2  3  48 
Aides 
Nursing Facilities  1  10  9  5  4  7  36 
Nondirect Care 
3  3  6  7  6  4  29 
Providers 
Other Long-Term 
1  0  4  4  3  4  16 
Care Facilities 
Total   164  236  219  220  150  166  1,155 
   
Source:  OIG analysis of Unit Quarterly Statistical Reports, FYs 2009 through 2011.
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  21 
   
   
 
Table C-4:  Provider Fraud Investigations 
 
Provider   
FY 2009  FY 2010  FY 2011 
Category 
Facilities  Opened  Closed  Opened  Closed  Opened  Closed  Total 
Hospitals  7  4  3  6  3  2  25 
Nursing Facilities  3  1  1  1  2  4  12 
Other Long-Term 
0  1  0  0  0  0  1 
Care Facilities 
Practitioners  Opened  Closed  Opened  Closed  Opened  Closed  Total 
Doctors of 
Medicine or  23  26  16  19  19  19  122 
Osteopathy 
Dentists  3  2  10  4  4  1  24 
Optometrists/ 
1  0  0  0  3  2  6 
Opticians 
Other 
0  1  1  1  0  1  4 
Practitioners 
Counselors/ 
0  0  1  0  1  0  2 
Psychologists 
Podiatrists  0  1  0  0  0  0  1 
Medical Support  Opened  Closed  Opened  Closed  Opened  Closed  Total 
Home Health 
71  42  105  85  100  93  496 
Care Aides 
Other Medical 
12  16  9  16  13  12  78 
Support 
Pharmaceutical 
6  1  3  11  13  13  47 
Manufacturers 
Durable Medical 
Equipment  0  1  21  5  4  5  36 
Suppliers 
Transportation 
10  1  5  11  4  4  35 
Services 
Pharmacies  3  7  3  5  3  3  24 
Laboratories  3  4  2  2  1  3  15 
Home Health 
2  0  2  3  5  0  12 
Care Agencies 
Nurses/Doctors 
1  3  0  2  1  0  7 
Assistants 
Program Related  Opened  Closed  Opened  Closed  Opened  Closed  Total 
Medicaid Program 
2  0  3  3  0  1  9 
Administration 
Billing Companies  0  0  0  0  1  0  1 
Other Program 
1  0  0  0  0  0  1 
Related 
Total   148  111  185  174  177  163  958 
   
Source:  OIG analysis of Unit Quarterly Statistical Reports, FYs 2009 through 2011.
 
 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  22 
   
   
APPENDIX D 
Case File Review Population, Sample Size Counts, and 
Confidence Interval Estimates 
Table D-1 shows population and sample counts and percentages by case 
type.  Note that both samples have percentages of case types similar to the 
general population, though sample counts for some case types are very 
small.  Because of these small sample sizes, we cannot reliably generalize 
what we found in our sample review to each case type in the population, 
and only our overall estimates project to the population of all case files.  
We estimated the 4 population values for all 1,472 case files from the 
results of our review of the case files selected in our simple random 
samples.  Table D-2 includes the estimate descriptions, sample sizes, point 
estimates, and 95-percent confidence intervals for these four estimates.  
 
Table D-1:  Population and Sample Size Counts for Case Types 
Population Count and  Sample Count* and  Sample Count* and 
Case Type 
(%) n=1,472  (%) n=100  (%) n=50 
Closed  1,127 (77%)  70 (70%)  37 (74%) 
Open  345 (23%)  30 (30%)  13 (26%) 
       
Civil  59 (4%)  4 (4%)  2 (4%) 
Criminal  1,413 (96%)  96 (96%)  48 (96%) 
       
Global  46 (3%)  3 (3%)  2 (4%) 
Patient 
736 (50%)  50 (50%)  25 (50%) 
Abuse/Neglect 
Provider Fraud  690 (47%)  47 (47%)  23 (46%) 
Source:  The Medicaid Fraud Control Unit provided a list of all case files open during fiscal years 2009 through 
2011. 
*The Office of Inspector General generated this random sample. 
 
 
 
 
 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  23 
   
   
 
Table D-2:  Confidence Intervals for Key Case File Review Data 
Point  95-Percent Confidence 
Estimate Description  Sample Size 
Estimate  Interval 
Case Files With 
Documented Supervisory  100  100.0%  96.5100.0% 
Approval for Opening 
Case Files With 
Documented Supervisory  70  94.3%  86.398.4% 
Approval for Closing 
Case Files With 
Documentation Indicating 
100  78.0%  68.985.5% 
at Least One Supervisory 
Review 
Case Files With No 
Documentation Indicating 
100  38.0%  28.748.0% 
Periodic Supervisory 
Review 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  24 
   
   
APPENDIX E 
Unit Comments 
 
 
 
 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  25 
   
   
 
 
 
 
 
 
 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  26 
   
   
 
 
 
 
 
 
 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  27 
   
   
 
 
 
 
 
 
 
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  28 
  Procedures have been implemented which include a notice to our accounting staff identifying 
those receipts which are to be included in program income so that that any investigation/legal costs 
which are recovered in the future that meet the definition of program income will be properly reported 
on the Federal Financial Status Report and deducted from total costs under the grant. The $8,080 (.09% 
of the Unit's FY 10 & 11 approved budget) identified as being an unallowable HHS Payment System 
withdrawal during the two year period FY 2010 and FY 2011 will be reimbursed to OIG. This will be 
accomplished by offsetting our FY13 award through a reduction in our award by $8,080 for our second 
quarter advance. 
Conclusion 
The Louisiana MFCU would again like to express our appreciation of the efforts of HHS-OIG in 
conducting this review in such a courteous and professional manner. We would also like to note that 
your staff members were understanding of the difficulties and challenges facing MFCUs in implementing 
the performance stand;~rds. We also appreciate the open lines of communication with your staff 
throughout the review process and the constructive criticism offered by your staff. We appreciate this 
opportunity to improve our operations so that we may complete our mission more efficiently and 
effectively. 
Respectfully submitted, 
Frederick A. Duhy, Jr. 
Assistant Attorney General 
Director, Medicaid Fraud Control Unit 
Louisiana State Medicaid Fraud Control Unit: 2012 Onsite Review (OEI-09-12-00010)  29   
   
ACKNOWLEDGMENTS 
This report was prepared under the direction of Timothy S. Brady, Regional 
Inspector General for Evaluation and Inspections in the San Francisco 
regional office, and Michael Henry, Deputy Regional Inspector General.  
Matthew DeFraga served as the lead analyst for this study.  Central office 
staff who provided support include Susan Burbach, Kevin Farber, and 
Debra Roush.  Office of Audit Services staff who provided support include 
Gupa Goha, Ryan Moul, and Clarissa Yu.  Office of Investigations staff 
who provided support include Jeannine Morgan.   
Louisiana State Medicaid Fraud Control Unit:  2012 Onsite Review (OEI-09-12-00010)  30 
   
 
Office of Inspector General 
http://oig.hhs.gov 
 
The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452, as 
amended, is to protect the integrity of the Department of Health and Human Services 
(HHS) programs, as well as the health and welfare of beneficiaries served by those 
programs.  This statutory mission is carried out through a nationwide network of audits, 
investigations, and inspections conducted by the following operating components: 
Office of Audit Services 
The Office of Audit Services (OAS) provides auditing services for HHS, either by conducting 
audits with its own audit resources or by overseeing audit work done by others.  Audits 
examine the performance of HHS programs and/or its grantees and contractors in carrying 
out their respective responsibilities and are intended to provide independent assessments of 
HHS programs and operations.  These assessments help reduce waste, abuse, and 
mismanagement and promote economy and efficiency throughout HHS. 
Office of Evaluation and Inspections 
The Office of Evaluation and Inspections (OEI) conducts national evaluations to provide 
HHS, Congress, and the public with timely, useful, and reliable information on significant 
issues.  These evaluations focus on preventing fraud, waste, or abuse and promoting 
economy, efficiency, and effectiveness of departmental programs.  To promote impact, OEI 
reports also present practical recommendations for improving program operations.  
Office of Investigations 
The Office of Investigations (OI) conducts criminal, civil, and administrative investigations 
of fraud and misconduct related to HHS programs, operations, and beneficiaries.  With 
investigators working in all 50 States and the District of Columbia, OI utilizes its resources 
by actively coordinating with the Department of Justice and other Federal, State, and local 
law enforcement authorities.  The investigative efforts of OI often lead to criminal 
convictions, administrative sanctions, and/or civil monetary penalties. 
Office of Counsel to the Inspector General 
The Office of Counsel to the Inspector General (OCIG) provides general legal services to 
OIG, rendering advice and opinions on HHS programs and operations and providing all 
legal support for OIGs internal operations.  OCIG represents OIG in all civil and 
administrative fraud and abuse cases involving HHS programs, including False Claims Act, 
program exclusion, and civil monetary penalty cases.  In connection with these cases, OCIG 
also negotiates and monitors corporate integrity agreements.  OCIG renders advisory 
opinions, issues compliance program guidance, publishes fraud alerts, and provides other 
guidance to the health care industry concerning the anti-kickback statute and other OIG 
enforcement authorities.