Department of Health and Human Services 
OFFICE OF 
 
INSPECTOR GENERAL 
 
 
 
 
 
 
 
N S M
EB  RASKA  TATE  EDICAID 
 
F C U : 
  RAUD  ONTROL  NIT   
 
2014 O R  
  NSITE  EVIEW 
 
 
Brian P. Ritchie  
Acting Deputy Inspector General 
for Evaluation and Inspections  
 
June 2014 
OEI-07-14-00060   
   
EXECUTIVE SUMMARY:  NEBRASKA STATE MEDICAID FRAUD CONTROL 
UNIT:  2014 ONSITE REVIEW  
OEI-07-14-00060 
 
WHY WE DID THIS STUDY 
The Office of Inspector General (OIG) oversees the activities of all Medicaid Fraud 
Control Units (MFCUs or Units). As part of this oversight, OIG conducts periodic 
reviews of all Units and prepares public reports based on these reviews.  The 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 conducted an onsite review in February 2014.  We analyzed  data from seven 
sources: (1) a review of policies, procedures, and documentation related to the Units 
operations, staffing, and caseload for fiscal years (FYs) 2011 through 2013; (2) a review 
of financial documentation for FYs 2011 through 2013; (3) structured interviews with 
key stakeholders; (4) a survey of Unit staff; (5) structured interviews with the Units 
management; (6) an onsite review of a sample of case files that were open in 
FYs 2011 through 2013; and (7) an onsite observation of Unit operations.  
 
WHAT WE FOUND 
For FYs 2011 through 2013, the Unit reported combined civil and criminal recoveries of 
nearly $33 million and 22 criminal convictions.  Our review identified that 91 percent of 
cases files contained documentation of periodic supervisory reviews and nearly all case 
files contained documentation of supervisory approval for opening and closing.  
However, the Unit did not transmit reports of nine convictions to OIG for the purpose of 
program exclusion, and conviction information for two cases was not transmitted in a 
timely manner.  Additionally, the Units Memorandum of Understanding with the State 
Medicaid agency did not reflect current Federal legal requirements.  Lastly, although 
85 percent of Nebraska Medicaid enrollees received health care through managed care, 
the Unit received only three managed care referrals during the review period. 
 
WHAT WE RECOMMEND   
The Unit should work with OIGs MFCU oversight division to ensure compliance with 
the 12 performance standards.  The Nebraska Unit concurred with all four of our 
recommendations.  
   
   
TABLE OF CONTENTS 
Objective......................................................................................................1 

Background..................................................................................................1 

Methodology................................................................................................4 

Findings........................................................................................................6 

For FYs 2011 through 2013, the Nebraska Unit reported  

combined civil and criminal recoveries of nearly $33 million  

and 22 criminal convictions .............................................................6 
 
Ninety-one percent of cases files contained documentation of 

periodic supervisory reviews; nearly all case files contained 

documentation of supervisory approval for opening and closing ....6 

The Unit did not transmit reports of nine convictions to OIG for 

the purpose of program exclusion; conviction information for  

two cases was not transmitted in a timely manner ...........................7 

The Units MOU with the State Medicaid agency did not reflect 
current Federal legal requirements ...................................................8 

Although 85 percent of Nebraska Medicaid enrollees received 

health care through managed care, the Unit received only 

three managed care referrals during FYs 2011 through 2013 ..........8 

Conclusion and Recommendations ............................................................10 

Unit Comments and Office of Inspector General Response ......................12 

Appendixes ................................................................................................13 

A: 2012 Revised Performance Standards .....................................13 

B: 1994 Performance Standards....................................................20 

C: Detailed Methodology..............................................................24 

D: Investigations Opened and Closed By Provider Category  

for FYs 2011 Through 2013 ...........................................................27 

E: Medicaid Fraud Control Unit Referrals by Referral Source  

for FYs 2011 Through 2013 ...........................................................28 

F: Point Estimates and Confidence Intervals ................................30 

G: Unit Comments ........................................................................31 

Acknowledgments......................................................................................35 

 
 
   
OBJECTIVE 
To conduct an onsite review of the Nebraska 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 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 FY 2013, combined Federal and 
State grant expenditures for the Units totaled $230 million.4,  5  That year, 
the 50 Units employed 1,912 individuals.6  
To carry out its duties and responsibilities in an effective and efficient 
manner, each Unit must employ an interdisciplinary staff that consists of at 
least an investigator, an auditor, and an attorney.7  Unit staff review 
complaints provided by the State Medicaid agency and other sources and 
determine their potential for criminal prosecution and/or civil action.  In 
FY 2013, the 50 Units collectively obtained 1,341 convictions and 
879 civil settlements or judgments.8   That year, the Units reported 
recoveries of approximately $2.5 billion.9  
 
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 All FY references in this report are based  on  the Federal FY (October  1 through 
     
September 30). 
 
5  Office of  Inspector General (OIG),  Medicaid Fraud Control Units Statistical Data for 

Fiscal Year 2013.  Accessed at http://oig.hhs.gov/fraud/medicaid-fraud-control-units-
mfcu/expenditures_statistics/fy2013-statistical-chart.htm on March  11, 2014. 

6 Ibid. 

7 SSA    1903(q)(6) and  42 CFR 1007.13. 

8 OIG,  Medicaid Fraud Control Units  Statistical Data for Fiscal Year 2013.  Accessed at 

http://oig.hhs.gov/fraud/medicaid-fraud-control-units-mfcu/expenditures_statistics/ 
 
fy2013-statistical-chart.htm on March  11, 2014. 

9 Ibid. 

Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)   1   
   
The Unit must be in an office of the State Attorney General, another State 
government office with Statewide prosecutorial authority, or operate under 
a formal arrangement with the State Attorney Generals office.10 Units are 
required to have either Statewide authority to prosecute cases or formal 
procedures to refer suspected criminal violations to an agency with such 
authority.11  In 44 States, the Units are located within offices of State 
Attorneys General; in the remaining 6 States, the Units are located in other  
State agencies.12,  13  Generally, Units located outside of an Attorney 
Generals Office must refer cases to other offices with prosecutorial 
authority. 
Each Unit must be a single identifiable entity of State government, distinct 
from the State Medicaid agency and each Unit must develop a formal 
agreementi.e., a Memorandum of Understanding (MOU)that 
describes the Units relationship with that agency.14  
Oversight of the MFCU Program 
The Secretary of Health and Human Services delegated to OIG the 
authority to both annually certify the Units and to administer grant awards 
to reimburse States for a percentage of their costs of operating certified 
Units.15   All Units are currently funded by the Federal Government on a 
75-percent matching basis, with the States contributing the remaining 
25 percent.16   To receive Federal reimbursement, each Unit must submit an 
initial application to OIG.17 OIG reviews the application and notifies the 
Unit if the application is approved and the Unit is certified.  Approval and 
certification are for a 1-year period; the Unit must be recertified each year 
thereafter.18  
Pursuant to Title XIX of the SSA, States must operate Units that 
effectively carry out their statutory functions and meet program 
 
10 59 Fed. Reg. 49080 (Sept. 26, 1994).  Accessed at http://oig.hhs.gov/fraud/medicaid-
fraud-control-units-mfcu/files/Performance%20Standards.pdf on February 21, 2014.   

11  SSA  1903(q)(1). 
 
12 OIG, Medicaid Fraud Control Units.  Accessed at http://oig.hhs.gov/fraud/medicaid-
fraud-control-units-mfcu/index.asp on  March 11, 2014. 
 
13 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. 

14 SSA  1903(q)(2);  42 CFR   1007.5 and 1007.9(d).  
 
15 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  (FFP). 

16 SSA   1903(a)(6)(B). 

17 42  CFR  1007.15(a). 
 
18 42  CFR  1007.15(b) and (c). 
 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   2 
   
   
requirements.19  OIG developed and issued 12 Performance Standards to 
further define the criteria it applies in assessing whether a Unit is 
effectively carrying out statutory functions and meeting program  
requirements.20  Examples of criteria include maintaining an adequate 
caseload through referrals from several sources, maintaining an annual 
training plan for all professional disciplines, and establishing policy and 
procedure manuals to reflect the Units operations.  See Appendix A for 
the 2012 Performance Standards used in this review and Appendix B for 
the1994 Performance Standards.  
Nebraska State MFCU 
The Nebraska Unit is located in the Office of  Attorney General within the  
Nebraska Department of Justice and has Statewide criminal and civil 
jurisdiction to prosecute cases. At the time of our review, the Units nine 
employees were located in the State capital of Lincoln.  These nine 
employees include:  three attorneys, two investigators, two auditors, a data 
analyst, and a legal assistant. For FY 2013, the Unit expended a total of 
$770,566 in combined Federal and State funds.21    
Referrals. The Unit receives referrals of Medicaid fraud and of patient 
abuse and neglect from the State Medicaid agency, Adult Protective 
Services (APS), the Attorney Generals Web site, the State Long Term  
Care Ombudsman, and private citizens.  (See Appendix D for MFCU 
referrals by referral source for FYs 2011 through 2013.)  Unit staff follow 
a set of screening procedures in determining whether to open referrals as 
cases. For example, the Chief of Investigations screens all APS 
complaints and forwards them as potential cases to the Unit director for 
further review.  For referrals made by sources other than APS (e.g., 
referrals from the State Medicaid agency), the legal assistant or recipient 
of the referral reviews the information, and, if necessary, gathers 
additional information or documentation necessary for preparing a case 
intake form.  The legal assistant completes the case intake forms and 
gathers relevant preliminary information (e.g., following up with local law 
enforcement if they are involved or verifying whether the Unit or State 
Medicaid agency has investigated or is currently investigating the provider 
or suspect). The legal assistant forwards the intake forms to the Unit 
 
19 SSA  1902(a)(61). 
20 OIG initially published performance standards in  1994 (59 Fed. Reg. 49080) and 
issued revised standards on June 1, 2012.  (See 77  Fed. Reg.  32645.)   Although the 
1994 Performance Standards were in effect  during most of  the review period, we apply  
the 2012 performance standards where appropriate in the findings and report 
recommendations.  
21 OIG,  Medicaid Fraud Control Units  Statistical Data for Fiscal Year 2013. Accessed 
at http://oig.hhs.gov/fraud/medicaid-fraud-control-units-mfcu/expenditures_statistics/  
fy2013-statistical-chart.htm on March  11, 2014. 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   3 
   
   
director for final review and then to the Chief Investigator for staff  
assignments.  Referrals that are not related to Medicaid fraud, patient 
abuse, patient neglect, or misappropriation of patient funds are redirected 
to the proper agency.  
Investigation and Prosecution. The Unit uses a team approach in the 
investigation and prosecution of cases of Medicaid fraud and patient abuse 
and neglect. Generally, teams consist of one investigator, one auditor, and 
one attorney. An investigator or auditor is assigned as the team leader and 
is responsible for coordinating case activities, such as analyzing 
documents, interviewing witnesses, serving subpoenas, assisting in search 
warrants, and preparing factual findings.  The attorney assigned to the case 
is responsible for providing legal expertise and guidance to the 
investigative team, securing access to the providers records, obtaining 
documentary evidence for trial, and developing a legal theory for 
prosecution. 
Previous Review  
In 2007, OIG conducted an onsite review of the Nebraska MFCU and found 
that the Unit did not adequately document the current status and progress 
made in ongoing case investigations and/or prosecutions.  Further, several of 
the case files reviewed by OIG did not include an identifiable record to 
indicate that an official MFCU investigation had begun or had been formally 
approved. OIG also found that case files reviewed contained no formal final 
statement or closing report summarizing the final disposition of the cases.  
OIG concluded that the lack of sufficient documentation in the case files  
reviewed made it difficult to determine the exact status of the cases and 
progress made in them.  OIG strongly suggested that the Unit incorporate 
opening, interim, and closing investigative memorandum(s) into the case file 
records to ensure that investigations and prosecutions of cases would not 
linger or falter.  OIG also suggested that the Unit consider incorporating a 
sequential file index in each case file. 
METHODOLOGY 
We conducted the onsite review in February 2014.  We based our review 
on an analysis of data from seven sources:  (1) a review of policies and 
procedures and documentation on the Units operations, staffing, and 
caseload for FYs 2011 through 2013; (2) a review of financial 
documentation for FYs 2011 through 2013; (3) structured interviews with 
key stakeholders; (4) a survey of Unit staff; (5) structured interviews with 
the Units management; (6) an onsite review of a sample of case files that 
were open at any time in FYs 2011 through 2013; and (7) an onsite 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   4 
   
   
observation of Unit operations. Appendix C contains the details of our 
methodology.   
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. 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   5 
   
   
FINDINGS 
For FYs 2011 through 2013, the Nebraska Unit
reported combined civil and criminal recoveries of 
nearly $33 million and 22 criminal convictions 
The Unit reported combined criminal and civil recoveries of nearly 
$33 million for FYs 2011 through 2013.  The majority of the recoveries 
were obtained from global settlements, which accounted for 91 percent 
of the Units recoveries during the period of our review.22  See Table 1 for 
details regarding criminal and civil recoveries. 
Table 1: Reported Nebraska MFCU Criminal and Civil Recoveries,  
FYs 20112013  
Type of  Total  
FY 2011   FY 2012   FY 2013  
Recovery   Recoveries  
Criminal 
$7,679  $11,268  $16,380   $35,327  
Recoveries 
Global Case 
$7,564,528  $15,411,411  $6,608,548   $29,584,487  
Recoveries  
Nonglobal 
$507,516   $569,870   $1,809,037   $2,886,423 
Civil Recoveries  
 Total     
$8,079,723  $15,992,549  $8,433,965   $32,506,237  
     Recoveries  
Source:  OIG analysis of Unit  Submitted Documentation, FYs 20112013. 
During the review period, the Unit closed 366 investigations, obtained 
54 civil settlements and judgments, charged 26 individuals, obtained 
22 criminal convictions, and had 1 dismissal.  See Appendix E for details 
on investigations opened and closed by provider category for 
FYs 2011 through 2013. 
Ninety-one percent of case files contained 
documentation of periodic supervisory reviews; nearly 
all case files contained documentation of supervisory 
approval for opening and closing 
According to the 2012 Performance Standard 7(a), supervisory reviews 
should be conducted periodically and noted in the case file to ensure 
timely case completion.  The Unit director reported that supervisory 
 
 
 
22 Global cases are civil false-claims actions involving the U.S. Department of Justice 
and other State MFCUs.  The National  Association of Medicaid Fraud Control Units  
facilitates the settlement of global cases. 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   6 
   
   
 
reviews were conducted at least once a month.23 Ninety-one percent of 
case files for cases open longer than 30 days contained documentation of 
periodic supervisory reviews. Ninety-eight percent of case files for cases 
open longer than 30 days contained documentation of at least one 
supervisory review. (See Appendix F for all estimates and 95-percent 
confidence intervals for projections.) 
Additionally, according to the 2012 Performance Standard 5(b), Unit 
supervisors should approve the opening and closing of cases to ensure a 
continuous case flow and timely completion of cases.  We found that 
98 percent of all case files contained documentation of supervisory 
approval of opening and that 100 percent of closed case files contained 
documentation of supervisory approval of closing the case.  
The Unit did not transmit reports of nine convictions
to OIG for the purpose of program exclusion;
conviction information for two cases was not 
transmitted in a timely manner 
According to the 2012 Performance Standard 8(f), the Unit should 
transmit to OIG reports of all convictions for the purpose of exclusion 
from Federal health care programs.  Specifically, this standard stipulates 
that convictions should be reported within 30 days of sentencing. 
The Unit did not submit all conviction information to OIG for the purpose 
of program exclusion; of the 22 convictions that should have been sent to 
OIG for exclusion, 9 convictions were not submitted. 24  These nine 
convictions were related to patient-funds cases that involved sentencing of 
nonproviders. Of the 13 convictions that were transmitted, 2 were not 
transmitted in a timely manner.  Specifically, the Unit transmitted 
information to OIG 229 days after sentencing for one conviction and 
300 days after sentencing for the other. 
 
23 The Unit  director reported that supervisory  reviews are conducted twice a month.  A 
formal review occurs during  the Units  monthly team  meetings.  All Unit staff are present  
during these meetings, and the status of all open cases and next steps for them are 
discussed and reviewed.  A second informal review  of each case is conducted in smaller 
groups, which include the Unit director, senior assistant attorney  general,  chief 
investigator, and the lead auditor or investigator assigned to the case.  The Unit director  
reported that he maintains notes from these informal meetings, but that notes from these 
meetings are not maintained in the case files.  For the purposes of our  review, we  
reviewed the case files (including the electronic case file database)  to  determine whether 
at least one supervisory review  was documented in the case file for each month the case  
was open.  
24 OIG confirmed that as  of June 3, 2014 (after we collected information for  our onsite  
review), the Unit had submitted information for all  nine convictions.  
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   7 
   
   
The Units MOU with the State Medicaid agency did 
not reflect current Federal legal requirements 
According to the 2012 Performance Standard 10(b), the Units MOU with 
the State Medicaid agency should meet current Federal legal requirements, 
including provisions for payment suspension on the basis of credible 
allegation of fraud.25  The Units MOU, last updated in 2011, did not 
include provisions describing the process between the Unit and the State 
Medicaid agency for providers who were subject to a payment suspension 
on the basis of credible allegation of fraud.  However, both the Unit 
director and the director of the Nebraska Medicaid Program Integrity Unit 
indicated that payment suspension protocols were in place between the 
Unit and the State Medicaid agency during the review period. 
Although 85 percent of Nebraska Medicaid enrollees
received health care through managed care, the Unit 
received only 3 managed care referrals during 
FYs 2011 through 2013 
According to the 2012 Performance Standard 4(a), the Unit should take 
steps to ensure that managed care organizations (MCOs) refer cases of 
suspected provider fraud to the Unit. As of July 2010, 85 percent of 
Nebraska Medicaid enrollees received their health care services through 
MCOs.26  However, in FYs 2011 through 2013, the Unit reported receiving 
a total of three MCO referralstwo referrals in FY 2012 and one referral 
in FY 2013. 
For FYs 2011 through 2013, both the Unit director and the director of the 
Nebraska Medicaid Program Integrity Unit (PI Unit) reported that MCOs 
were not required to refer cases of Medicaid fraud to the Unit, but rather to 
the State Medicaid agency. The PI Unit director stated:  [I]f there are 
concerns of waste and abuse, [MCOs] share that with us, and we make a 
referral to the MFCU.  Of the three MCO referrals received during 
FYs 2011 through 2013, two of the referrals were received by the State 
Medicaid agency and then referred to the Unit.  The third MCO referral 
 
25 The Affordable Care  Act,   6402(h)(2), requires State Medicaid programs, as a 
condition of receiving FFP, to suspend payments to providers for whom there is a 
credible allegation  of fraud, unless good cause exists to  not suspend payments.  One way  
to establish good cause is for the MFCU to  inform the State Medicaid agency that the 
suspension would compromise or  jeopardize its investigation of the provider. The  
Centers for Medicare and Medicaid Services (CMS) and OIG implemented this provision 
in revisions to  42 CFR  455.23 and 1007.9(e) effective March 25, 2011 (76 Fed. Reg.  
5862). 
26 CMS, Medicaid Managed Care Enrollment  as of July 1,  2010.  Accessed online  at 
http://www.cms.gov/Research-Statistics-Data-and-Systems/Computer-Data-and-
Systems/MedicaidDataSourcesGenInfo/Downloads/2010July1.pdf  on March 17, 2014. 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   8 
   
   
was received directly from an MCO. During our onsite review, the Unit 
director stated that the Unit is seeking recognition as a required recipient 
of referrals in the contract between the State Medicaid agency and MCOs.  
To facilitate this recognition, the Unit director reported that Unit staff 
attend quarterly meetings with the State Medicaid agency and MCOs. 
   
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   9 
   
   
CONCLUSION AND RECOMMENDATIONS 
For FYs 2011 through 2013, the Unit reported combined civil and criminal 
recoveries of nearly $33 million.  During the review period, the Unit 
closed 366 investigations with 26 individuals charged, obtained 54 civil 
settlements and judgments, obtained 22 criminal convictions, and had 
1 dismissal.  
Our review identified that 91 percent of cases files contained 
documentation of periodic supervisory reviews, and nearly all case files 
contained documentation of supervisory approval for opening and closing.  
However, the Unit did not transmit reports of nine convictions to OIG for 
the purpose of program exclusion, and conviction information for two 
cases was not transmitted in a timely manner.  Additionally, the Units 
MOU with the State Medicaid agency did not reflect current Federal legal 
requirements because the MOU did not address payment suspension on 
the basis of a credible allegation of fraud.  Lastly, although 85 percent of 
Nebraska Medicaid enrollees received health care through managed care, 
the Unit received only three managed care referrals during the review 
period. 
We recommend that the Nebraska Unit: 
Ensure that all open cases receive periodic supervisory review  
in accordance with Unit policy 
The Unit should ensure that all open cases receive periodic supervisory 
review at least once a month throughout the duration of the case and 
should document these reviews in the case file, in accordance with Unit 
policy. Doing so will ensure that supervisory reviews are conducted 
periodically and noted in the case file to ensure timely case completion.  
Transmit reports of all convictions to OIG for the purpose of 
exclusion from Federal health care programs 
The Unit should ensure that all individuals convicted of fraud, abuse, 
and/or neglect, including individuals with convictions related to patient 
funds, are reported to OIG within 30 days of their sentencing. 
Revise the current MOU with the State Medicaid agency to 
reflect current Federal legal requirements 
The Unit should work with the State Medicaid agency to revise its MOU 
to reflect the current Federal legal requirement of payment suspension on 
the basis of credible allegation of fraud. 
Continue to take steps to ensure that the State Medicaid 
agency and MCOs refer all suspected cases of fraud among 
managed care providers to the Unit 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   10 
   
   
The Unit should continue to work with the State Medicaid agency and 
MCOs to ensure that all suspected cases of fraud among managed care 
providers are referred to the Unit. This could include the development of 
operational protocols focused on fraud among managed care providers and 
might specifically include recognition of the MFCU as a direct recipient of  
referrals from MCOs. Further, the Unit should work with the State 
Medicaid agency to obtain all necessary information that the latter 
receives from MCOs regarding suspected fraud in managed care.  
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   11 
   
   
UNIT RESPONSE AND OFFICE OF INSPECTOR GENERAL  
RESPONSE 
The Nebraska Unit concurred with all four of our recommendations.   
The Unit concurred with our first recommendation (that it ensure that all 
open cases receive periodic supervisory review).   The Unit stated that 
although a high percentage of its case files include documentation of 
supervisory review, as well as documentation of supervisory approval of 
the opening and closing of the case, it will strive to achieve 100-percent 
compliance for future reviews.   
The Unit concurred with our second recommendation (that it transmit 
reports of all convictions to OIG for the purpose of exclusion).  The Unit 
stated that the nine convictions that were not submitted to OIG were 
related to matters other than health care fraud, specifically, the theft of 
patient funds by nonproviders. The Unit stated that its interpretation of 
existing law and regulations had been that convictions of nonproviders did 
not need to be reported to OIG for the purpose of program exclusion.  The 
Unit stated that, since learning that OIG interprets law and regulations to 
include nonproviders, it has referred all nine convictions to OIG for the 
purpose of program exclusion.  The Unit also indicated that in the future, 
it will refer all convictions to OIG for exclusion within 30 days of 
sentencing. 
The Unit concurred with our third recommendation (that it revise the 
current MOU with the State Medicaid agency to reflect current Federal 
legal requirements).  The Unit acknowledged that the current MOU does 
not address a protocol for the suspension of payment to providers on the 
basis of credible allegation of fraud.  The Unit stated that an addendum to  
the current MOU will be drafted to formally add a payment suspension 
protocol. The Unit anticipated that this addendum would be added by the 
end of 2014. 
The Unit concurred with our fourth recommendation (that it continue to 
take steps to ensure that the State Medicaid agency and MCOs refer all 
suspected cases of fraud among managed care providers).  The Unit stated 
that contracts between the State Medicaid agency and the MCOs did not 
identify the Unit as a stakeholder in pursuing fraud among managed care 
providers. The Unit also stated that it is attempting to resolve the issue as  
the contracts come up for renewal or revision.  Further, the Unit stated that 
it participates in quarterly meetings between Medicaid staff and MCOs. 
The full text of the Units comments is provided in Appendix G. 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   12 
   
   
APPENDIX A 
2012 Revised Performance Standards27   
1. 	A unit conforms with all applicable statutes, regulations, and 
policy directives, including:  
a. 	  Section 1903(q) of the Social Security Act, containing the basic 
requirements for operation of a MFCU; 
b.	   Regulations for operation of a MFCU contained in 42 CFR 

part 1007; 

c. 	  Grant administration requirements at 45 CFR part 92 and Federal 
cost principles at 2 CFR part 225; 
d.	   OIG policy transmittals as maintained on the OIG Web site; and  
e. 	  Terms and conditions of the notice of the grant award. 
2. 	A Unit maintains reasonable staff levels and office locations in 
relation to the States Medicaid program expenditures and in 
accordance with staffing allocations approved in its budget.  
a. 	  The Unit employs the number of staff that is included in the Units 
budget estimate as approved by OIG. 
b.	   The Unit employs a total number of professional staff that is 
commensurate with the States total Medicaid program  
expenditures and that enables the Unit to effectively investigate  
and prosecute (or refer for prosecution) an appropriate volume of 
case referrals and workload for both Medicaid fraud and patient 
abuse and neglect. 
c. 	  The Unit employs an appropriate mix and number of attorneys, 
auditors, investigators, and other professional staff that is both 
commensurate with the States total Medicaid program  
expenditures and that allows the Unit to effectively investigate and 
prosecute (or refer for prosecution) an appropriate volume of case 
referrals and workload for both Medicaid fraud and patient abuse 
and neglect. 
d. 	  The Unit employs a number of support staff in relation to its 
overall size that allows the Unit to operate effectively.  
e. 	  To the extent that a Unit maintains multiple office locations, such 
locations are distributed throughout the State, and are adequately 
 
27 77 Fed. Reg. 32645, June  1, 2012. 
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staffed, commensurate with the volume of case referrals and 
workload for each location. 
3. 	A Unit establishes written policies and procedures for its 
operations and ensures that staff are familiar with, and adhere to, 
policies and procedures.  
a. 	  The Unit has written guidelines or manuals that contain current 
policies and procedures, consistent with these performance 
standards, for the investigation and (for those Units with 
prosecutorial authority) prosecution of Medicaid fraud and patient 
abuse and neglect. 
b. 	  The Unit adheres to current policies and procedures in its 

operations. 

c. 	  Procedures include a process for referring cases, when appropriate, 
to Federal and State agencies.  Referrals to State agencies, 
including the State Medicaid agency, should identify whether 
further investigation or other administrative action is warranted, 
such as the collection of overpayments or suspension of payments. 
d. 	  Written guidelines and manuals are readily available to all Unit 
staff, either online or in hard copy. 
e. 	  Policies and procedures address training standards for Unit 

employees. 

4. 	A Unit takes steps to maintain an adequate volume and quality of 
referrals from the State Medicaid agency and other sources. 
a. 	  The Unit takes steps, such as the development of operational 
protocols, to ensure that the State Medicaid agency, managed care 
organizations, and other agencies refer to the Unit all suspected 
provider fraud cases. Consistent with 42 CFR 1007.9(g), the Unit 
provides timely written notice to the State Medicaid agency when 
referred cases are accepted or declined for investigation.  
b. 	  The Unit provides periodic feedback to the State Medicaid agency 
and other referral sources on the adequacy of both the volume and 
quality of its referrals.  
c. 	  The Unit provides timely information to the State Medicaid or 
other agency when the Medicaid or other agency requests 
information on the status of MFCU investigations, including when 
the Medicaid agency requests quarterly certification pursuant to 
42 CFR 455.23(d)(3)(ii). 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   14 
   
   
d. 	  For those States in which the Unit has original jurisdiction to 
investigate or prosecute patient abuse and neglect cases, the Unit 
takes steps, such as the development of operational protocols, to 
ensure that pertinent agencies refer such cases to the Unit, 
consistent with patient confidentiality and consent.  Pertinent 
agencies vary by State but may include licensing and certification 
agencies, the State Long Term Care Ombudsman, and adult 
protective services offices. 
e. 	  The Unit provides timely information, when requested, to those 
agencies identified in (D) above regarding the status of referrals. 
f. 	  The Unit takes steps, through public outreach or other means, to 
encourage the public to refer cases to the Unit.  
5. 	A Unit takes steps to maintain a continuous case flow and to 
complete cases in an appropriate timeframe based on the 
complexity of the cases.  
a. 	  Each stage of an investigation and prosecution is completed in an 
appropriate timeframe. 
b. 	  Supervisors approve the opening and closing of all investigations 
and review the progress of cases and take action as necessary to 
ensure that each stage of an investigation and prosecution is 
completed in an appropriate timeframe. 
c. 	  Delays to investigations and prosecutions are limited to situations 
imposed by resource constraints or other exigencies. 
6. 	A Units case mix, as practicabl e, covers all significant provider 
types and includes a balance of fraud and, where appropriate, 
patient abuse and neglect cases.  
a. 	  The Unit seeks to have a mix of cases from all significant provider 
types in the State.  
b. 	  For those States that rely substantially on managed care entities for 
the provision of Medicaid services, the Unit includes a 
commensurate number of managed care cases in its mix of cases. 
c. 	  The Unit seeks to allocate resources among provider types based 
on levels of Medicaid expenditures or other risk factors.  Special 
Unit initiatives may focus on specific provider types. 
d. 	  As part of its case mix, the Unit maintains a balance of fraud and 
patient abuse and neglect cases for those States in which the Unit 
has original jurisdiction to investigate or prosecute patient abuse 
and neglect cases.  
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   15 
   
   
e. 	  As part of its case mix, the Unit seeks to maintain, consistent with 
its legal authorities, a balance of criminal and civil fraud cases. 
7. 	A Unit maintains case files in an effective manner and develops a 
case management system that allows efficient access to case 
information and other performance data. 
a. 	  Reviews by supervisors are conducted periodically, consistent with 
MFCU policies and procedures, and are noted in the case file.  
b. 	  Case files include all relevant facts and information and justify the 
opening and closing of the cases. 
c. 	  Significant documents, such as charging documents and settlement 
agreements, are included in the file.  
d. 	  Interview summaries are written promptly, as defined by the Units 
policies and procedures. 
e. 	  The Unit has an information management system that manages and 
tracks case information from initiation to resolution. 
f. 	  The Unit has an information management system that allows for 
the monitoring and reporting of case information, including the 
following: 
1. 	  The number of cases opened and closed and the reason that 
cases are closed. 
2. 	  The length of time taken to determine whether to open a 
case referred by the State Medicaid agency or other 
referring source. 
3. 	  The number, age, and types of cases in the Units 
inventory/docket. 
4. 	  The number of referrals received by the Unit and the 
number of referrals by the Unit to other agencies. 
5. 	  The dollar amount of overpayments identified. 
6. 	  The number of cases criminally prosecuted by the Unit or 
referred to others for prosecution, the number of 
individuals or entities charged, and the number of pending 
prosecutions. 
7. 	  The number of criminal convictions and the number of civil 
judgments. 
8. 	  The dollar amount of fines, penalties, and restitution 
ordered in a criminal case and the dollar amount of 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   16 
   
   
recoveries and the types of relief obtained through civil 
judgments or prefiling settlements. 
8. 	A Unit cooperates with OIG and other Federal agencies in the 
investigation and prosecution of Medicaid and other health care 
fraud.  
a. 	  The Unit communicates on a regular basis with OIG and other 
Federal agencies investigating or prosecuting health care fraud in 
the State.  
b.	   The Unit cooperates and, as appropriate, coordinates with OIGs 
Office of Investigations and other Federal agencies on cases being 
pursued jointly, cases involving the same suspects or allegations, 
and cases that have been referred to the Unit by OIG or another 
Federal agency. 
c. 	  The Unit makes available, to the extent authorized by law and 
upon request by Federal investigators and prosecutors, all 
information in its possession concerning provider fraud or fraud in 
the administration of the Medicaid program. 
d.	   For cases that require the granting of extended jurisdiction to 
investigate Medicare or other Federal health care fraud, the Unit 
seeks permission from OIG or other relevant agencies under 
procedures as set by those agencies.  
e. 	  For cases that have civil fraud potential, the Unit investigates and 
prosecutes such cases under State authority or refers such cases to 
OIG or the U.S. Department of Justice. 
f. 	  The Unit transmits to OIG, for purposes of program exclusions 
under section 1128 of the Social Security Act, all pertinent 
information on MFCU convictions within 30 days of sentencing, 
including charging documents, plea agreements, and sentencing 
orders. 
g. 	  The Unit reports qualifying cases to the Healthcare Integrity & 
Protection Databank, the National Practitioner Data Bank, or 
successor data bases.  
9. 	 A Unit makes statutory or programmatic recommendations, when 
warranted, to the State government. 
a. 	  The Unit, when warranted and appropriate, makes statutory 
recommendations to the State legislature to improve the operation 
of the Unit, including amendments to the enforcement provisions 
of the State code. 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   17 
   
   
b. 	  The Unit, when warranted and appropriate, makes other regulatory 
or administrative recommendations regarding program integrity 
issues to the State Medicaid agency and to other agencies 
responsible for Medicaid operations or funding.  The Unit monitors 
actions taken by the State legislature and the State Medicaid or 
other agencies in response to recommendations. 
10. 	A Unit periodically reviews  its MOU with the State Medicaid 

agency to ensure that it reflects current practice, policy, and 

legal requirements. 

a. 	  The MFCU documents that it has reviewed the MOU at least every 
5 years, and has renegotiated the MOU as necessary, to ensure that 
it reflects current practice, policy, and legal requirements. 
b.	   The MOU meets current Federal legal requirements as contained in 
law or regulation, including 42 CFR 455.21, Cooperation with 
State Medicaid fraud control units, and 42 CFR 455.23, 
Suspension of payments in cases of fraud. 
c. 	  The MOU is consistent with current Federal and State policy, 
including any policies issued by OIG or the CMS.  
d.	   Consistent with Performance Standard 4, the MOU establishes a 
process to ensure the receipt of an adequate volume and quality of  
referrals to the Unit from the State Medicaid agency. 
e. 	  The MOU incorporates by reference the CMS Performance 
Standard for Referrals of Suspected Fraud from a State Agency to 
a Medicaid Fraud Control Unit. 
11. 	A Unit exercises proper fiscal  control over Unit resources.  
a. 	  The Unit promptly submits to OIG its preliminary budget 
estimates, proposed budget, and Federal financial expenditure 
reports. 
b.	   The Unit maintains an equipment inventory that is updated 

regularly to reflect all property under the Units control. 

c. 	  The Unit maintains an effective time and attendance system and 
personnel activity records. 
d.	   The Unit applies generally accepted accounting principles in its 
control of Unit funding. 
e. 	  The Unit employs a financial system in compliance with the 
standards for financial management systems contained in 
45 CFR 92.20. 
12. 	A Unit conducts training that  aids in the mission of the Unit. 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   18 
   
   
a. 	  The Unit maintains a training plan for each professional discipline 
that includes an annual minimum number of training hours and that 
is at least as stringent as required for professional certification. 
b. 	  The Unit ensures that professional staff comply with their training 
plans and maintain records of their staffs compliance.  
c. 	  Professional certifications are maintained for all staff, including  
those that fulfill continuing education requirements.  
d. 	  The Unit participates in MFCU related training, including training 
offered by OIG and other MFCUs, as such training is available and 
as funding permits. 
e. 	  The Unit participates in cross training with the fraud detection staff  
of the State Medicaid agency. As part of such training, Unit staff 
provide training on the elements of successful fraud referrals and 
receive training on the role and responsibilities of the State 
Medicaid agency. 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   19 
   
   
APPENDIX B 
1994 Performance Standards28   
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 
Units budget as approved by the OIG? 
b. 	  Does the Unit employ the number of attorneys, auditors, and 
investigators that were approved in the Units budget? 
c. 	  Does the Unit employ a reasonable size of professional staff in 
relation to the States 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: 
a. 	  Does the Unit have policy and procedure manuals? 
 
28 59 Fed. Reg. 49080, Sept. 26, 1994. 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   20 
   
   
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 State Medicaid 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 possibl e, 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? 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   21 
   
   
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 Social Security Act, 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 statutor y 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 States statutes when necessary and appropriate 
to do so? 
b. 	  Does the Unit provide program recommendations to State 

Medicaid agency when appropriate? 

Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   22 
   
   
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 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 add to the mission of the 
Unit? 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   23 
   
   
APPENDIX C 
Detailed Methodology 
Data collected from the seven sources below was used to describe the 
caseload and assess the performance of the Unit.   
Data Collection 
Review of Unit Documentation. Prior to the onsite visit, we analyzed 
information from several sources regarding the Units investigation and 
referral for prosecution of Medicaid cases.  Specifically, we collected and 
analyzed information about the number of referrals the Unit received, the 
number of investigations the Unit opened and closed, the outcomes of 
those investigations, and the Units  case mix.  We also collected and 
analyzed information about the number of cases that the Unit referred for 
prosecution and the outcomes of those prosecutions.  We gathered this 
information from several sources, including the Units quarterly statistical 
reports, annual reports, recertification questionnaire, policy and 
procedures manuals, MOU with the State Medicaid agency, and the report 
from the previous OIG onsite review (in 2007).  Additionally, we 
confirmed with the Unit director that the information we had was current 
as of January 2014, and as necessary, requested any additional data or  
clarification.  
Review of Unit Financial Documentation. We reviewed the Units control 
over its fiscal resources to identify any internal control issues or other 
issues involving use of resources. Prior to the onsite review, we reviewed 
the Units financial policies and procedures; its response to an internal 
control questionnaire; and documents (such as financial status reports) 
related to MFCU grants. During the onsite review, we reviewed a sample  
of the Units purchase and travel transactions.  In addition, we reviewed 
vehicle records, the supply inventory, and a sample of time and effort 
records. 
Interviews with Key Stakeholders. In January 2014, we interviewed key 
stakeholders, such as officials in the United States  Attorneys Offices, the 
Attorney Generals Office, and other agencies that interacted with the Unit 
(Adult Protective Services, Medicaid Program Integrity Unit, Office of the 
State Long Term Care Ombudsman, and Professional Licensure Division).  
We focused these interviews on the Units relationship and interaction with 
OIG and other Federal and State authorities, and we identified opportunities 
for improvement.  We used the information collected from these interviews 
to develop subsequent interview questions for Unit management. 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   24 
   
   
Survey of Unit Staff.  In January 2014, we conducted an online survey of 
all nonmanagerial Unit staff within each professional discipline 
(i.e.,  investigators, auditors, and attorneys) as well as support staff.  The 
response rate was 100 percent. Our questions focused on operations of the 
Unit, opportunities for improvement, and practices that contributed to the 
effectiveness and efficiency of Unit operations and/or performance.  The  
survey also sought information about the Units compliance with 
applicable laws and regulations. 
Onsite Interviews with Unit Management.   We conducted structured 
interviews with the Units management in February 2014.  We interviewed 
the Unit director (who also served as the Units lead attorney) as well as 
the chief investigator and auditor.   We asked these individuals to provide 
information related to:  (1) the Units operations, (2) Unit practices that  
contributed to the effectiveness and efficiency of Unit operations and/or 
performance, (3) opportunities for the Unit to improve its operations 
and/or performance, and (4) clarification regarding information obtained 
from other data sources. 
Onsite Review of Case Files and Other Documentation. The Unit 
provided a list of 460 cases that were open at any point during 
FYs 2011through 2013.  We excluded 77 cases that the Unit had 
categorized as global. We then selected a simple random sample of 
100 cases from the remaining 383 cases.  This sample of 100 cases 
included 92 cases that were open longer than 30 days and 88 cases that 
were closed at some point during the review period.  We reviewed all 
100 sampled case files.29  Using the results of our review of the sampled 
case files, we estimated proportions for all 383 case files, for the 
subpopulation of cases open longer than 30 days, and cases closed during 
the review period. These estimates and the 95-percent confidence 
intervals are shown in Appendix F.  From the initial sample of 100 case 
files, we selected a further simple random sample of 50 files for a more 
in-depth review of selected issues, such as the timeliness of investigations  
and case development.  We did not estimate any population or 
subpopulation proportions from this additional sample of 50 case files. 
Onsite Review of Unit Operations.  During our February 2014 onsite visit, 
we reviewed the Units workspace and operations.  Specifically, we 
visited the Unit headquarters in Lincoln.  While onsite, we observed the 
 
29 One case file did not contain documentation for the reviewer to determine whether the 
supervisor approved the opening  of the case.  As a result, this case was excluded from our  
analysis for this specific data  point, and projections for this data  point are  projected to  
99 case files rather than 100. 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   25 
   
   
Units offices and meeting spaces, security of data and case files, location 
of select equipment, and the general functioning of the Unit. 
Data Analysis  
We analyzed data to identify any opportunities for improvement and any 
instances in which the Unit did not fully meet the performance standards  
or was not operating in accordance with laws, regulations, and policy 
transmittals.30  
   
 
30 All relevant  regulations, statutes, and  policy transmittals are available online at  
http://oig.hhs.gov/fraud/medicaid-fraud-control-units-mfcu.  
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   26 
   
   
APPENDIX D 
Medicaid Fraud Control Unit Referrals by Referral Source for 
FYs 2011 Through 2013 
FY 2011   FY 2012   FY 2013  
Abuse &   Patient  Abuse &   Patient  Abuse &   Patient 
Referral Source   Fraud   Fraud   Fraud  
Neglect   Funds   Neglect   Funds   Neglect   Funds  
Medicaid Agency  
(Office of Quality 
Assurance)  
31 
PI/SURS   18  0  0  22  0  1  18  0  0 
Medicaid Agency  
Attorney General  
0  0  1  1  0  0  6  0  0 
State Survey & 
Certification 
0  0  0  0  0  0  0  0  0 
Other State 
Agencies 
3  0  0  0  0  0  0  0  0 
Licensing Board 
0  0  1  1  0  0  0  0  0 
Law Enforcement 
0  0  0  0  0  1  0  0  0 
Office of Inspector 
General 
1  0  0  1  1  0  2  0  0 
Prosecutors 
0  0  0  0  0  0  0  0  0 
Providers 
1  0  3  6  0  1  0  0  1 
Provider 
Associations  
0  0  0  0  0  0  0  0  0 
Private Health 
Insurer 
0  0  0  0  0  0  0  0  0 
Long Term Care 
Ombudsman  
0  0  0  0  0  0  0  0  1 
Adult Protective 
Services  
3  41  27  8  17  16  6  4  33 
Private Citizens 
5  0  0  8  2  2  4  0  1 
MFCU Hotline 
0  0  0  2  0  0  1  0  0 
Other  
12  0  2  15  0  3  11  0  0 
   Total   41  41  33  62  20  22  47  4  36 
   Annual Total  115  105  87 
Source:  OIG analysis of Unit-submitted documentation, FYs 2011-2013. 
   
 
31 PI = program integrity; SURS  = Surveillance and  Utilization Review 
Subsystem. 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   27 
   
   
APPENDIX E 
Investigations Opened and Closed By Provider Category for 
FYs 2011 Through 2013 
Table E-1:  Fraud Investigations  
Provider Category   FY 2011   FY 2012   FY 2013  
Facilities   Opened  Closed  Opened  Closed  Opened   Closed 
 Hospitals  2  3  4  1  1  1 
     Nursing Facilities   1  1  1  2  1  1 
     Other Long-Term Care   
0  0  0  0  1  0 
     Facilities  
     Substance Abuse Treatment     
0  0  0  0  1  1 
Centers  
     Other   2  1  3  4  0  0 
   Subtotal   5  5  8  7  4  3 
Practitioners   Opened  Closed  Opened  Closed  Opened   Closed 
     Doctors of Medicine or  
3  0  2  3  2  4 
     Osteopathy  
Dentists  2  1  2  3  0  2 
Podiatrists  0  0  1  0  0  1 
     Optometrists/Opticians  0  0  0  0  0  0 
     Counselors/Psychologists  0  7  9  4  6  9 
Chiropractors  2  0  2  2  0  0 
     Other   1  1  2  3  0  0 
   Subtotal   8  9  18  15  8  16 
Medical Support  Opened   Closed   Opened   Closed   Opened   Closed 
 Pharmacies 
3  2  4  4  2  2 
Pharmaceutical 
     Manufacturers   9  10  8  9  13  14 
     Suppliers of Durable Medical  
     Equipment and/or Supplies  4  2  1  3  4  3 
     Laboratories 
0  1  0  0  0  0 
     Transportation Services 
0  0  0  1  0  1 
     Home Health Care Agencies  
0  1  6  4  2  1 
     Home Health Care Aides  
14  7  19  14  14  22 
     Nurses, Physician Assistants,  
Nurse Practitioners, Certified  
Nurse Aides  0  0  0  0  0  0 
Radiologists 
0  0  0  0  0  0 
     Medical SupportOther  
0  0  1  0  1  0 
   Subtotal   30  23  39  35  36  43 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   28 
   
   
 
Table E-1 (Continued):  Fraud Investigations  
Program  Related   Opened  Closed  Opened  Closed  Opened   Closed 
     Managed Care    0  0  1  1  0  0 
Medicaid Program  
0  0  0  0  0  0 
Administration 
Billing Company   0  0  0  0  0  0 
     Other  0  0  0  0  1  1 
   Subtotal   0  0  1  1  1  1 
   Total Provider Categories   43  37  66  58  49  63 
Source:  OIG analysis of Unit-submitted documentation, FYs 20112013.  
Table E-2:  Patient Abuse and Neglect Investigations  
Provider Category   FY 2011   FY 2012   FY 2013  
  Opened  Closed  Opened  Closed  Opened   Closed 
     Nursing Facility   20  28  5  5  0  2 
     Other Long-Term Care   6  9  1  1  0  1 
Nurses/Physicians 
Assistant/Nurse    
6  10  6  3  4  7 
Practitioner/Certified Nurse       
Aide 
     Home Health Aide  1  1  1  2  0  0 
     Other   8  12  7  6  0  2 
Total   41  60  20  17  4  12 
Source: OIG analysis of Unit-submitted documentation, FYs 2011-2013. 
Table E-3:  Patient Funds Investigations  
Provider Category   FY 2011   FY 2012   FY 2013  
  Opened  Closed  Opened  Closed  Opened   Closed 
     Nondirect Care   0  1  1  0  0  1 
Nurses/Physicians 
Assistant/Nurse    
0  0  3  1  0  1 
Practitioner/Certified Nurse       
Aide 
     Home Health Aide  0  0  0  0  0  0 
     Other  34  46  20  34  36  35 
Total   34  47  24  35  36  37 
Source: OIG analysis of Unit-submitted documentation, FYs 2011-2013. 
   
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   29 
   
   
APPENDIX F 
Point Estimates and 95-Percent Confidence Intervals Based on  
Reviews of Case Files 
95-Percent  
Sample  Point  Confidence Interval  
Estimate Characteristic  
Size  Estimate  
Lower  Upper  
Percentage of cases files that 
were open longer than 30 days 
92  91.3%   84.8%   95.2%  
containing documentation of 
periodic supervisory  review  
Total cases files that were open 
longer than 30 days containing 
92  322  298  335 
documentation of periodic 
supervisory review  
Percentage of cases files that 
were open longer than 30 days 
92  97.8%   93.0%   99.3%  
containing documentation of at 
least one supervisory review  
Total cases files that were open 
longer than 30 days containing 
92  345  327  350 
documentation of at least one 
supervisory review  
Percentage of case files 
containing documentation of  99*  98.0%   93.4%   99.4%  
supervisory approval for opening  
Total case files containing 
documentation of supervisory   99*  372  354  377 
approval for opening 
Percentage of closed case files 
containing documentation of  88  100.0%   96.3%   100.0%  
supervisory approval for closing  
Total closed case files containing  
documentation of supervisory   88  327  315  327 
approval for closing 
Source:  OIG analysis of Nebraska  Unit case files, 2014. 

*One case file did not contain documentation for the  reviewer to determine whether the supervisor approved the 

opening of the  case.  As a result, this case was excluded from our analysis for this data point. 

 
   
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   30 
   
   
APPENDIX G 
Unit Comments 
 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   31 
   
   
   
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   32 
   
   
   
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   33 
  contracb l~Omc up for renewal ur revision.  In the me:mtimc, the ~vlFCU panicipates in 
quarterly mc.::tings hctwt:cn \kdicaid stafl anJ the various :VfCOs.  !IAFCL' Performance 
Standard l(a) requires that an ~1FC'U "take steps, such as the development of operational 
protocols. to ensure that the State :..kdieaid agency, manngcd care organizations. anJ 
other agencies refer to the l:nit all 5Uspected provider fraud cases."  We will ensure that 
this performance standard is met in tlw future. 
The Nebraska /Vkdi,.aid Fraud and Patient Abuse t;nit appreciates the OIG 's clrorts 
during the on-sit~.: revi~.:w process.  We e:;pecially appreciate the many positive lindings 
containnl in the report, which is not typically found in the customary audit-ba~cd reponing 
format.  \Ve look forward to our continued good work in!:( relationship \\ith 010 and all of om 
federal mJ st:lle partners in tight in!,! fraud within '\cbra>ka 's 1vkdilaid program. 
Sincerely yours, 
JOJ\ BRt:NI:--JG 
i\Uorncy General 
D. 1\lark Collins 
Assistant Attorm:y General 
Director. iV!cdicaid FrauJ and Pati,,nt Abuse 1 'nit 
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review (OEI-07-14-00060)  34   
   
ACKNOWLEDGMENTS 
This report was prepared under the direction of Brian T.  Whitley, Regional 
Inspector General for Evaluation and Inspections in the Kansas City 
regional office.   
Rae Hutchison served as the team leader for this study.  Other Office of 
Evaluation and Inspections staff who conducted the study include 
Michael P. Barrett, Susan Burbach, and Jordan R. Clementi.  Office of 
Investigations staff who conducted the study include Kelly Earl.  Central 
office staff who provided support include Christine Moritz and 
Sherri Weinstein.  
Nebraska State Medicaid Fraud Control Unit:  2014 Onsite Review  (OEI-07-14-00060)                                   35 
   
   
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.