Department of Health and Human Services 
 
 
OFFICE OF 
 
INSPECTOR GENERAL 
 
 
 
 
 
 
 
 
W S M
ISCONSIN  TATE  EDICAID 
 
 
F C U :
RAUD  ONTROL  NIT   
2016 O R  
NSITE  EVIEW
 
 
Suzanne Murrin 
Deputy Inspector General  
for Evaluation and Inspections 
 
May 2017 
OEI-07-16-00240   
   
EXECUTIVE SUMMARY:  WISCONSIN STATE MEDICAID FRAUD CONTROL UNIT:  
2016 ONSITE REVIEW 
OEI-07-16-00240 
 
WHY WE DID THIS STUDY  
The Office of Inspector General (OIG) administers grant awards for the Medicaid Fraud Control 
Units (MFCUs or Units), annually recertifies the Units, and oversees the Units performance in 
accordance with the requirements of the grant.  As part of this oversight, OIG conducts periodic 
reviews of all Units and prepares public reports based on these reviews.  These reviews assess 
Units adherence to the 12 MFCU performance standards and compliance with applicable 
Federal statutes and regulations. 
 
HOW WE DID THIS STUDY 
We conducted an onsite review of the Wisconsin Unit in June 2016.  We based our review on 
analysis of data from seven sources:  (1) policies, procedures, and documentation related to the 
Units operations, staffing, and caseload; (2) financial documentation for fiscal years (FYs) 
2013 through 2015; (3) structured interviews with key stakeholders; (4) a survey of Unit staff; 
(5) structured interviews with the Units management; (6) a sample of files for cases that were 
open in FYs 2013 through 2015; and (7) observation of Unit operations. 
 
WHAT WE FOUND 
For FYs 2013 through 2015, the Wisconsin Unit reported significant results including 
24 convictions, 24 civil judgments and settlements, and combined criminal and civil recoveries 
of approximately $137 million.  This amounted to recovery of more than $32 for every $1 spent 
in the review period.  However, we identified several operational deficiencies and found a lack 
of current and comprehensive written policies and procedures, which may have contributed to 
the Units noncompliance with Federal regulations and nonadherence to certain performance 
standards.  Specifically, of the 41 Unit case files that we reviewed, 28 lacked documentation of 
supervisory approval to open the cases and 24 lacked documentation of periodic supervisory 
reviews.  The Unit did not report half of its convictions and one adverse action to Federal 
partners, and it reported others outside of required timeframes.  Furthermore, the Unit lacked a 
written training plan for its professional employees and investigated five cases that were outside 
of its grant authority.  Finally, the Unit did not always maintain adequate internal controls related 
to personnel and accounting.  
 
WHAT WE RECOMMEND  
In addition to reimbursing OIG for Federal financial participation claimed for investigations of 
ineligible cases and unallowable expenditures for salary, fringe, and associated indirect costs, we 
recommend that the Wisconsin Unit:  (1) ensure that it documents supervisory approval to open 
cases and supervisory reviews of Unit case files; (2) ensure that it consistently reports 
convictions and adverse actions to Federal partners within required timeframes; (3) establish 
written training plans for the Units professional disciplines; and (4) improve internal controls 
related to personnel and accounting.  The Unit concurred with all six of our recommendations.    
   
   
  
TABLE OF CONTENTS 
Objective ......................................................................................................1 
Background ..................................................................................................1 
Methodology ................................................................................................4 
Findings........................................................................................................6 
For FYs 2013 through 2015, the Unit reported 24 criminal 
convictions; 24 civil judgments and settlements; and combined 
criminal and civil recoveries of approximately $137 million ..........6 
Prior to January 2017, the Unit lacked current and comprehensive 
written policies and procedures .......................................................7 
Of the 41 Unit case files that we reviewed, 28 lacked 
documentation of supervisory approval to open the cases and 
24 lacked documentation of periodic supervisory case reviews ......8 
The Unit did not report half of its convictions and one adverse 
action to Federal partners and reported others outside of  
required timeframes .........................................................................9 
The Unit lacked a written training plan ......................................... 11 
The Unit investigated five sampled cases that were not eligible  
for Federal funding ........................................................................ 11 
The Unit did not always maintain adequate internal controls related 
to personnel and accounting, and it reported unallowable expenses 
to the grant program .......................................................................12 
Conclusion and Recommendations ............................................................14 
Unit Comments and Office of Inspector General Response ..........16 
Appendixes ................................................................................................17 
A:  2012 Performance Standards ...................................................17 
B:  Unit Referrals by Referral Source for FYs 2013 Through 
2015................................................................................................21 
C:  Detailed Methodology ..............................................................22 
E:  Unit Comments.........................................................................25 
Acknowledgments......................................................................................28 
   
   
OBJECTIVE 
To conduct an onsite review of the Wisconsin State Medicaid Fraud 
Control Unit (MFCU or Unit). 
BACKGROUND  
The mission of MFCUs is to investigate and prosecute Medicaid provider 
fraud and patient abuse or neglect under State law.1  The Social Security 
Act requires each State to operate a MFCU, unless the Secretary of Health 
and Human Services (the Secretary) determines that operation of a Unit 
would not be cost-effective because minimal Medicaid fraud exists in a 
particular State and that 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 MFCUs.3 
Each Unit must employ an interdisciplinary staff that consists of at least an 
investigator, an auditor, and an attorney.4  Unit staff review referrals of 
provider fraud and patient abuse or neglect to determine their potential for 
criminal prosecution and/or civil action.  In fiscal year (FY) 2015, the 
50 Units collectively reported 1,553 convictions; 795 civil settlements or 
judgments; and approximately $745 million in recoveries.5, 6 
Units must meet a number of requirements established by the Social 
Security Act and Federal regulations.  For example, each Unit must: 
  be a single, identifiable entity of State government, distinct from 
the single State Medicaid agency;7   
  develop a formal agreement, such as a memorandum of 
understanding, that describes the Units relationship with the State 
Medicaid agency;8 and 
                        ____________________________________________________________ 
1 Social Security Act  1903(q).  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. 
2 Social Security Act  1902(a)(61).   
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 Social Security Act  1903(q)(6); 42 CFR  1007.13. 
5 Office of Inspector General (OIG), MFCU Statistical Data for Fiscal Year 2015.  
Accessed at http://oig.hhs.gov/fraud/medicaid-fraud-control-units-
mfcu/expenditures_statistics/fy2015-statistical-chart.htm on February 17, 2016. 
6 All FY references in this report are based on the Federal FY (October 1 through     
September 30). 
7 Social Security Act  1903(q)(2); 42 CFR  1007.5 and 1007.9(a). 
8 42 CFR  1007.9(d).  
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   1 
   
   
  have either statewide authority to prosecute cases or formal 
procedures to refer suspected criminal violations to an agency with 
such authority.9   
MFCU Funding 
Each MFCU is funded jointly by its State and the Federal government.  
Federal funding for the MFCUs is provided as part of the Federal 
Medicaid appropriation, but it is administered by OIG.10  Each Unit 
receives Federal financial participation equivalent to 75 percent of its total 
expenditures, with State funds contributing the remaining 25 percent.11  In 
FY 2015, combined Federal and State expenditures for the Units totaled 
$251 million, $188 million of which represented Federal funds.12   
Oversight of the MFCU Program 
The Secretary delegated to OIG the authority to administer the MFCU grant 
program.13  To receive Federal reimbursement, each Unit must submit an 
initial application to OIG for approval and be recertified each year 
thereafter.14   
In annually recertifying the Units, OIG evaluates Unit compliance with 
Federal requirements and adherence to performance standards.  The Federal 
requirements for Units are contained in the Social Security Act, regulations, 
and policy guidance.15  In addition, OIG has published 12 performance 
standards that it uses to assess whether a Unit is effectively performing its 
responsibilities.16  The standards address topics such as staffing, maintaining 
adequate referrals, and cooperation with Federal authorities.  Appendix A of 
this report contains the performance standards.   
OIG also performs periodic onsite reviews of the Units, such as this review 
of the Wisconsin MFCU.  During each onsite review, OIG evaluates a Units 
compliance with laws, regulations, and policies, as well as the Units 
adherence to the 12 performance standards.  OIG also makes observations 
about best practices, provides recommendations to the Units, and monitors 
                        ____________________________________________________________ 
9 Social Security Act  1903(q)(1). 
10 Social Security Act  1903(a)(6)(B). 
11 Ibid.  
12 OIG, MFCU Statistical Data for Fiscal Year 2015.  Accessed at 
http://oig.hhs.gov/fraud/medicaid-fraud-control-units-
mfcu/expenditures_statistics/fy2015-statistical-chart.htm on February 17, 2016.   
13 The Social Security Act authorizes the Secretary to award grants to the Units; the 
Secretary delegated this authority to OIG.   
14 42 CFR  1007.15(a)(c).  
15 On occasion, OIG issues policy transmittals to provide guidance and instructions to 
MFCUs.   
16 77 Fed. Reg. 32645 (June 1, 2012).  Accessed at 
http://www.oig.hhs.gov/authorities/docs/2012/PerformanceStandardsFinal060112.pdf on 
April 7, 2016.   
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   2 
   
   
the implementation of the recommendations.  OIGs evaluations of MFCUs 
differ from other OIG evaluations in that they support OIGs direct 
administration of the MFCU grant program.  These evaluations are subject to 
the same internal quality controls as other OIG evaluations, including 
internal peer review. 
OIG provides additional oversight, including the collection and 
dissemination of performance data, training, and technical assistance. 
Wisconsin MFCU 
Located in Madison, the Unita division of the Wisconsin Department of 
Justice (DOJ)investigates and prosecutes cases of Medicaid fraud and 
patient abuse or neglect.  At the time of our June 2016 onsite review, the 
Unit employed 11 staff members:  a director, an investigator supervisor, 
2 attorneys, 5 senior auditors, a legal associate, a legal secretary, and no 
investigators.  Unit investigators and auditors perform similar functions, 
despite holding different job classifications.  The Unit director supervises 
attorneys, investigators, and support staff; the investigator supervisor 
oversees auditors.  In FY 2015, combined Federal and State expenditures 
for Wisconsins Medicaid program were approximately $1.5 million.17   
The Unit experienced significant management changes in 2015 and 2016.  
In September 2015, the Units investigator supervisor resigned.  
In October 2015, a Unit attorney was appointed as acting director.  
In February 2016, the acting Unit director became the Unit director.  
In April 2016, a Unit investigator was promoted to the position of 
investigator supervisor.  At the time of our June 2016 onsite visit, the new 
management was creating and implementing new policies and procedures 
for the Units operations and conducting interviews for vacant investigator 
positions.  We note that this review reflects Unit operations under previous 
management. 
Referrals.  The Unit receives referrals from a variety of sources, including 
the State Medicaid agency, private citizens, and others.  Appendix B 
provides a breakdown of Unit referrals by referral source for the review 
period, FYs 2013 through 2015.  The Unit director or his/her designee 
determines whether a case that is referred to the Unit should be opened for 
investigation.   
Investigations and Prosecutions.  Opened cases are assigned to an attorney 
and an investigator or auditor.  During the review period, the Unit used a 
paper filing system.  Although the Unit did not have a written policy 
                        ____________________________________________________________ 
17 OIG, MFCU Statistical Data for Fiscal Year 2015.  Accessed at 
http://oig.hhs.gov/fraud/medicaid-fraud-control-units-
mfcu/expenditures_statistics/fy2015-statistical-chart.pdf on February 18, 2016. 
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   3 
   
   
regarding review of cases, Unit management reported that Unit practice 
was to conduct monthly case review meetings with the investigator or 
auditor and the investigator supervisor.  Unit management reported that 
the director also attended these meetings every other month.  Periodic 
supervisory reviews were documented on a form within the case file titled 
Administrative Reviews.  In November 2015, the Unit implemented an 
electronic case management system to track prosecutorial proceedings and 
was preparing to implement an electronic case management system for 
investigations following our onsite review. 
Unit attorneys prosecute cases of criminal and civil Medicaid fraud, 
patient abuse, patient neglect, and misappropriation of patient funds.  
During the review period, Unit attorneys prosecuted civil cases in State 
court under the Wisconsin State False Claims Act.  A relator provision of 
the law, which allows a private person to bring a lawsuit on behalf of the 
State, was repealed in July 2015.18,19   
Previous Onsite Review 
In 2010, OIG issued a report regarding its onsite review of the 
Wisconsin Unit.  The report found that a MFCU attorney had engaged in a 
minimal amount of non-MFCU work and that the Unit did not maintain time 
records regarding these activities.  OIG recommended that the Unit request 
an exception before engaging in future unauthorized activities and after 
receiving approval, maintain strict time records for such activities.  In 
addition, OIG recommended that the Unit employ an individual with 
medical or nursing expertise.  Our 2016 onsite review found no evidence 
that Unit management failed to maintain time records for staff; however, we 
identified new issues related to timekeeping.  We also found that the Unit 
employed a senior auditor who is a registered nurse, as recommended in our 
2010 report.   
METHODOLOGY 
Data Collection and Analysis 
We conducted the onsite review in June 2016.  We based our review on an 
analysis of data from seven sources:  (1) policies, procedures, and 
documentation related to the Units operations, staffing, and caseload; 
(2) financial documentation for FYs 2013 through 2015; (3) structured 
interviews with key stakeholders; (4) a survey of Unit staff; (5) structured 
interviews with the Units management; (6) a sample of files for cases that 
                        ____________________________________________________________ 
18 Wisconsin False Claims for Medical Assistance Act, Wis. Stat.  20.931. 
19 The Unit director stated the Unit will continue to participate in multi-State qui tam 
(whistleblower) cases and can proceed in applying False Claims Act procedures through 
a nonrelator provision. 
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   4 
   
   
were open in FYs 2013 through 2015; and (7) observation of Unit 
operations.  Appendix C provides 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.   
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   5 
   
   
FINDINGS 
Our review of the Wisconsin Unit found that it reported significant results 
during the review period:  24 criminal convictions; 24 civil judgments and 
settlements; and approximately $137 million in combined criminal and 
civil recoveries.  The Unit recovered more than $32 for every $1 spent.   
However, we also identified several operational deficiencies.  We found 
that the Unit did not have current and comprehensive written policies and 
procedures, which may have contributed to its noncompliance with 
Federal regulations and nonadherence to certain performance standards.  
In addition, the Unit did not always maintain adequate internal controls 
related to personnel and accounting. 
For FYs 2013 through 2015, the Unit reported 
24 criminal convictions; 24 civil judgments and 
settlements; and combined criminal and civil 
recoveries of approximately $137 million 
For FYs 2013 through 2015, the Unit reported 24 criminal convictions and 
24 civil judgments and settlements.  Table 1 illustrates the Units  
convictions and civil judgments and settlements for each fiscal year.  Of 
the Units 24 convictions over the 3-year period, 21 involved provider 
fraud and 3 involved patient abuse or neglect.   
Table 1:  Wisconsin MFCU Criminal Convictions and Civil Judgments and 
Settlements, FYs 20132015 
3-Year 
Outcomes  FY 2013  FY 2014  FY 2015  Total 
Criminal Convictions  9  10  5  24 
Civil Judgments and Settlements  2  10  12  24 
Source:  OIG analysis of Unit-submitted documentation, 2016. 
The Unit reported criminal and civil recoveries of approximately 
$137 million for FYs 2013 through 2015, with a range over the 3 years 
from $34 million per year to $55 million per year (shown in Table 2).   
   
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   6 
   
   
 
Table 2:  Wisconsin MFCU Recoveries and Expenditures, FYs 20132015 
Type of Recovery  FY 2013  FY 2014  FY 2015  3-Year Total 
Civil (combined global 
$54,702,494  $48,459,509  $32,003,558  $135,165,561 
and nonglobal)* 
Criminal  $54,750  $550,803  $1,547,374  $2,152,927 
     Total Recoveries  $54,757,244  $49,010,312  $33,550,932  $137,318,488 
     Total Expenditures  $1,274,531  $1,359,679  $1,512,865  $4,147,075 
Source:  OIG, MFCU statistical data FYs 20132015 and OIG analysis of Unit-submitted documentation, 2016. 
* Global recoveries derive from civil settlements or judgments involving the U.S. Department of Justice and 
a group of State MFCUs and are facilitated by the National Association of Medicaid Fraud Control Units.  Prior to 
FY 2015, OIG did not require Units to report global and nonglobal civil recoveries as separate items.  For this 
review, the Unit was unable to provide breakdowns (global vs. nonglobal) for its civil recoveries in FYs 2013 and 
2014.  For FY 2015, the Unit reported global recoveries of $2,728,557 and nonglobal recoveries of $29,275,001. 
 
Prior to January 2017, the Unit lacked current and 
comprehensive written policies and procedures  
At the time of our review, the Unit lacked current and comprehensive 
written policies and procedures governing Unit practices, which may have 
contributed to the Units noncompliance with Federal regulations and 
nonadherence to certain performance standards.  During our onsite visit, 
the Unit provided a Policy and Procedure Manual dated October 2009 
that addressed some aspects of Unit operations, such as the scope of the 
Units authority and policies governing referrals and closings.  However, 
the manual did not address other important aspects of Unit operations, 
including (among several others) case reviews and case files.  The Unit 
director acknowledged that during the review period, some policies were 
informal in nature, the manual was out of date, and staff did not widely 
adhere to [the manual].  Staff survey responses also reflected that the 
existing manual was outdated, noting that previous Unit management used 
verbal rules (i.e., ad hoc procedures). 
Performance Standard 3 states that a Unit should establish written policies 
and procedures for its operations and ensure that staff are familiar with, 
and adhere to, these policies and procedures.  Written policies and 
procedures help ensure that a Unit conducts its operations, case file 
reviews, and training consistently. Following the onsite review, on July 1, 
2016, the Unit distributed a new version of a Unit policies and procedures 
manual containing basic information (e.g., Unit jurisdiction, Unit 
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   7 
   
   
authority, Federal performance standards, etc.)  On January 3, 2017, the 
Unit distributed updated policies and procedures that addressed additional 
aspects of operations, including administrative case reviews, reporting of 
convictions, and basic training for professional staff. 
 
Of the 41 Unit case files that we reviewed, 28 lacked 
documentation of supervisory approval to open the 
cases, and 24 lacked documentation of periodic 
supervisory reviews 
Of the 41 Unit case files that we reviewed, 28 lacked documentation of 
supervisory approval to open the case.  However, only 3 cases of the 
28 closed case files that we reviewed lacked documentation of supervisory 
approval to close the case.20  Performance Standard 5(b) states that Unit 
supervisors should approve the opening and closing of cases.  Unit policy 
requires that the director approve the opening and closing of cases.  
Supervisory approval to open cases indicates that Unit supervisors are 
monitoring the intake of cases, thereby facilitating progress in the 
investigation.  Supervisory approval of the closing of cases helps ensure 
the timely completion and resolution of cases. 
Of the 41 Unit case files that we reviewed, 24 lacked documentation of  
periodic supervisory reviews.  In particular, these files lacked supervisor 
initials and/or notes regarding reviews on the administrative-review form 
within each case file.  However, the Unit reported that its practice was to 
hold supervisory review meetings monthly.21  The current director stated 
that the monthly reviews included the investigator supervisor and the 
individual assigned to the case.  Reviews held every other month also 
included the director.  Performance Standards 5(b) and 7(a) state that 
supervisors should periodically review the progress of cases, consistent 
with Unit policies and procedures; ensure that each stage of an 
investigation and prosecution is completed in an appropriate timeframe; 
and note in the case file that the reviews take place.  The director stated 
that the Unit is working to formalize processes and establish a written 
policy regarding supervisory case reviews.   
                        ____________________________________________________________ 
20 The Unit could not locate 7 of the 126 paper files for cases we requested for our 
sample.  We excluded these cases from our review. 
21 In the Units 2015 recertification questionnaire, the Unit reported that it held monthly 
supervisory reviews. 
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   8 
   
   
The Unit did not report half of its convictions and one 
adverse action to Federal partners and reported others 
outside of required timeframes 
The Unit did not report half of its convictions to OIG for the purpose of 
program exclusion from Federal health care programs and one adverse 
action to the National Practitioner Data Bank (NPDB).22  An additional 
10 convictions and 14 adverse actions were reported outside of required 
timeframes.  Performance Standard 8(f) states that within 30 days of 
sentencing, the Unit should transmit to OIG reports of all convictions for the 
purpose of exclusion from Federal health care programs.  Additionally, 
Federal regulations require that Units report any adverse actions resulting 
from investigations or prosecutions of healthcare providers to the NPDB 
within 30 days of the date of the final adverse action.23  
The Unit did not report half of its convictions to OIG; it did not 
report others within the required timeframe 
The Unit did not report 12 of its 24 convictions (50 percent) to OIG for the 
purpose of program exclusion.24  In addition, the Unit reported 
10 convictions more than 30 days after sentencing dates.  Table 3 shows the 
number of convictions that the Unit reported to OIG after the required 
timeframe.  Late reporting of convictions to OIG delays the initiation of 
the program exclusion process, which may result in improper payments to 
providers by Medicare or other Federal health care programs or possible 
harm to beneficiaries.  However, our analysis found that no Medicare or 
Medicaid claims were paid to the providers that the Unit reported late.   
Table 3:  Number of Convictions Reported to OIG After Required Timeframe 
Federal Partner  Convictions Reported  Convictions Reported  Convictions Reported  Total Convictions 
Reported To  Within 31 to 60 Days  Within 61 to 90 Days  More Than 90 Days  Reported More Than 
After Sentencing  After Sentencing  After Sentencing  30 Days After Sentencing  
OIG  2  1  7  10 
Source:  OIG analysis of Unit convictions and dates reported to OIG, 2016. 
                        ____________________________________________________________ 
22  The Department of Health and Human Services established the NPDB as a national 
health care fraud and abuse data collection program... for the reporting of certain final 
adverse actions... against health care providers, suppliers, or practitioners.  SSA 
 1128E(a); 45 CFR  61.1(2012).  This information used to be housed in a separate 
databank called the Healthcare Integrity and Protection Databank (HIPDB).  The HIPDB 
and the NPDB were merged into one databank in May 2013.  78 Fed. Reg. 20473 
(April 5, 2013). 
23 SSA  1128E(b)(4) and 45 CFR  60.5.   
24 Following the onsite review, OIG recommended that the Unit submit all missing 
convictions to OIG.  OIG confirmed that as of February 27, 2017, the Unit had submitted 
information for 7 of the 12 convictions remaining.    
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   9 
   
   
The Unit director explained that the reason these convictions were not 
reported or were reported late was that the Unit lacked current and 
comprehensive written policies and procedures and that management failed 
to monitor reporting to OIG.   
The Unit reported all but one of its adverse actions to the 
NPDB; it did not report two-thirds within the required 
timeframe 
The Unit reported all but one of its adverse actions to the NPDB.  The Unit 
reported 14 of 21 adverse actions (67 percent) to the NPDB more than 
30 days after the adverse action.  Table 4 shows the number of adverse 
actions that the Unit reported to the NPDB after the required timeframe.  
Performance Standard 8(g) states that Units should report any adverse 
actions generated as a result of investigations or prosecutions of healthcare 
providers to the NPDB within 30 calendar days of the date of the final 
adverse action.25  The NPDB is intended to restrict the ability of 
physicians, dentists, and other health care practitioners to move from State 
to State without disclosure or discovery of previous medical malpractice 
and/or adverse actions.  If a Unit fails to report adverse actions to the 
NPDB, individuals may be able to find new healthcare employment with an 
organization that is not aware of the adverse actions against them. 
 
Table 4:  Number of Adverse Actions Reported to the NPDB After Required Timeframe 
Federal Partner  Adverse Actions  Adverse Actions   Adverse Actions   Total  Adverse Actions  
Reported To  Reported Within 31 to  Reported Within 61 to  Reported More Than  Reported More Than 
60 Days After the  90 Days After the  90 Days After the  30 Days After the Action  
Action  Action  Action 
NPDB  5  2  7  14 
Source:  OIG analysis of Unit adverse actions and dates reported to the NPDB, 2016. 
The Unit director stated that the Unit reported adverse actions to the NPDB 
late because of a lack of current and comprehensive written policies and 
procedures.   
The Unit lacked a written training plan 
Although Unit staff participated in introductory Medicaid training through 
                        ____________________________________________________________ 
25 Performance Standard 8(g) states that the Unit should report qualifying cases to the 
Healthcare Integrity & Protection Databank [HIPDB], the National Practitioner Data 
Bank, or successor data bases.  The HIPDB and the NPDB were merged during our 
review period (FYs 2013 through 2015); therefore, we reviewed the reporting of adverse 
actions under NPDB requirements.  78 Fed. Reg. 20473 (April 5, 2013).  Examples of 
final adverse actions include, but are not limited to, convictions, civil judgments (but not 
civil settlements), and program exclusions.  See 45 CFR  60.3. 
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   10 
   
   
the National Association of Medicaid Fraud Control Units and other training 
related to health care fraud and investigation techniques, the Unit did not 
have a formal written training plan during the review period.  According to 
Performance Standard 12(a) and 12(d), a Unit should have a training plan 
that includes an annual number of required training hours for each 
professional discipline and should participate in MFCU-related training.  
Both the Unit director and investigator supervisor indicated that the 
unwritten rule was to provide one out-of-State training per year for staff, 
and they said that the Unit is currently working to address immediate 
training needs in the areas of investigative techniques, interviewing, and 
report writing.   
The Unit investigated five sampled cases that were not 
eligible for Federal funding 
In our review of the sampled cases, we found that the Unit investigated five 
cases that were ineligible for Federal matching fundsspecifically, 
a Federal share of $5,107. 
In two cases, the Unit investigated alleged fraud committed by two 
funeral-service providers funded through the Wisconsin Funeral and 
Cemetery Aids Program (WFCAP).26  The Medicaid statute and Federal 
regulations establish that a Unit may receive Federal Financial Participation 
only for fraud investigations that involve allegations of fraud in the 
administration of the Medicaid program, in the provision of medical 
assistance, or in the activities of Medicaid providers under the State 
Medicaid plan.27  However, a funeral service provider is not a provider 
under the State Medicaid plan; the WFCAP is not included in the States 
Medicaid plan or waivers; the WFCAP does not meet the definition of 
medical assistance; and funerals are not covered by the Federal Medicaid 
program.  Therefore, the investigation of these cases was not eligible for 
Federal funding. 28 
In two other cases, the Unit investigated complaints of patient abuse or 
neglect in private residences.  Since the complaints occurred outside of 
health care facilities or board and care facilities, these cases were also 
ineligible for Federal funding.29  
   
                        ____________________________________________________________ 
26 Wisconsins Department of Health Services administers the WFCAP, under which 
funeral and cemetery costs for decedents who received Medicaid benefits are eligible for 
reimbursement up to $2,500. 
27 SSA  1903(q)(3) and 42 CFR  1007.11(a) and 1007.19(d). 
28 SSA  1905; Wis. Stat. 49.43(8); Wis. Stat. 49.785(1). 
29 SSA  1903(q)(4)(A) and 42 CFR  1007.19(d). 
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   11 
   
   
In a fifth case, the Unit investigated an attorney who allegedly manipulated 
his clients application for Medicaid to meet eligibility requirements.  
However, investigations of eligibility fraud that do not involve suspected 
conspiracy with a provider are not eligible for Federal funds.30 
 
The Unit did not always maintain adequate internal 
controls related to personnel and accounting, and 
it reported unallowable expenses to the grant program  
The Unit did not always maintain adequate internal controls related to 
personnel and accounting, and it did not always ensure that personnel 
expenditures were allowed and adequately supported in accordance with 
Federal regulations.  Also, some timecards did not contain documentation of 
supervisory approval.  Additionally, multiple transactions related to costs 
shared among the Unit and other entities lacked an allocation methodology. 
Personnel costs were improperly charged 
The Unit claimed a net $25,095 (with a Federal share of $18,821) in 
unallowable expenditures for salary, fringe, and associated indirect costs 
during the review period.31  Federal regulations generally describe allowable 
costs incurred by State governments as necessary; reasonable; allocable; 
consistent; not used for other Federal awards cost-sharing; and adequately 
documented.32  However, OIG auditors found the Unit duplicated charges 
for nine pay periods of an employees salary and fringe costs.  The auditors 
also identified three payroll transactions in which the Unit incorrectly 
submitted the costs incurred by the employee rather than the Units portion 
of those costs.  Lastly, the Unit made an unsupported adjustment to an 
employees salary and fringe costs.   
Timecards did not always contain documentation of 
supervisory approval 
Supervisors did not always approve time and attendance records for the 
Units employees.  For 1 of the pay periods reviewed, 4 of the 13 timecards 
did not contain documentation of supervisory approval.  Performance 
Standard 11(c) states that [t]he Unit maintains an effective time and 
attendance system and personnel activity records.  In addition, Federal cost 
principles require charges to Federal awards for salaries and wages to be 
based on payrolls documented in accordance with generally accepted 
                        ____________________________________________________________ 
30 42 CFR  1007.19(e)(5). 
31 Fringe costs are the costs for fringe benefits (i.e., the nonwage compensation that an 
employer provides to an employee.) 
32 2 CFR pt. 225, Appendix A and 45 CFR  92.20(b)(6). 
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   12 
   
   
practice of the [Unit] and approved by a responsible official(s) of the 
[Unit].33  The Units parent agencythe Wisconsin DOJhad a policy 
stating that supervisors were responsible for ensuring all hours are 
correctly tabulated and reported.  Although the Unit generally practiced 
supervisory approval of timecards in accordance with Wisconsin DOJ 
policy, the Unit lacked a written policy explicitly requiring supervisory 
approval of timecards prior to being processed. 
Multiple transactions lacked an allocation methodology 
The Unit was unable to provide an allocation methodology to support 
multiple transactions related to costs shared by the Unit and other entities in 
the Wisconsin DOJ.  In order to be allowable under a Federal award, costs 
must be allocable.34  Regulations state:  A cost is allocable to a particular 
cost objective if the goods or services involved are chargeable or assignable 
to such cost objective in accordance with relative benefits received.35  
Failing to allocate costs based on criteria such as numbers of employees or 
hours worked could lead to incorrect apportionment of shared costs.  The 
auditors reviewed 11 sample items that did not have documentation to 
support the basis of the percentages charged.  The sample items included 
allocated expenditures for chairs, law library subscriptions, equipment 
leases, and other direct costs shared among the Unit and other entities in the 
Wisconsin DOJ.  Although the percentages charged to the Unit appear to be 
reasonable, the Unit should have a written methodology in place that 
supports that the allocation is in accordance with the relative benefits 
received.  The Unit stated that it planned to reassess and document all 
allocations.   
                        ____________________________________________________________ 
33 2 CFR pt. 225, Appendix B,  8.h(1). 
34 2 CFR pt. 225, Appendix A,  C.1.b. 
35 2 CFR pt. 225, Appendix A,  C.3.a. 
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   13 
   
   
CONCLUSION AND RECOMMENDATIONS 
Our review of the Wisconsin Unit found that it reported significant results 
during the review period:  24 criminal convictions; 24 civil judgments and 
settlements; and approximately $137 million in combined criminal and 
civil recoveries.  The Unit recovered more than $32 for every $1 spent.   
However, we identified a number of operational deficiencies.  
Specifically, the Units policies and procedures were outdated and 
incomplete for the entire review period.  The lack of current and 
comprehensive written policies and procedures may have contributed to 
the Units noncompliance with Federal regulations and nonadherence to 
certain performance standards.  For example, the Unit did not report some 
convictions and adverse actions to Federal partners and reported others 
outside of required timeframes.  Further, the Unit lacked a written training 
plan for its professional employees.   
Through our review of case files, we identified other areas in which the 
Unit should improve its operations.  Of the 41 Unit case files that we 
reviewed, 28 lacked documentation of supervisory approval to open the 
case, and 24 case files open longer than 30 days lacked documentation of 
supervisory case reviews.  In addition, the Unit investigated five cases that 
were not eligible for Federal funding.   
Finally, the Unit did not exercise adequate fiscal control of its resources, 
and reported $25,095 ($18,821 in Federal matching funds) in unallowable 
expenditures for salary, fringe, and associated indirect costs during the 
review period.    
We recommend that the Wisconsin Unit: 
Take appropriate steps to ensure that it documents supervisory 
approval to open cases and supervisory reviews of Unit case 
files  
The Unit should ensure that it documents supervisory approval to open 
cases and supervisory reviews of Unit case files.  To ensure that new 
policies and related processes are working as intended, the Unit could 
review a sample of its own case files to determine whether the changed 
policies and processes are effective.  If the Unit finds that some reviews 
are not being documented, it should further revise its processes to ensure 
the documentation of supervisory case reviews. 
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   14 
   
   
Ensure that convictions and adverse actions are consistently 
reported to Federal partners within required timeframes  
The Unit should ensure that convictions are consistently reported to OIG 
within 30 days of sentencing and that adverse actions are reported to the 
NPDB within 30 days of the action.   
Establish written training plans for the Units professional 
disciplines 
The Unit should develop and implement formal training plans in 
accordance with Performance Standard 3 and Performance Standard 12.  
The Unit may work with the National Association of Medicaid Fraud 
Control Units or OIG to identify additional relevant training opportunities 
for staff. 
Improve internal controls related to personnel and accounting 
The Unit should ensure that personnel expenditures are allowable and 
adequately supported by documentation in accordance with Federal 
regulations.  The Unit should also develop a policy that expands and 
clarifies existing Wisconsin DOJ policy and explicitly requires 
supervisory approval of timecards before they can be processed.  Finally, 
the Unit should identify and use a consistent written allocation 
methodology for costs that are shared among the Unit and other entities in 
the Wisconsin DOJ. 
Repay Federal matching funds spent investigating cases that 
were ineligible for Federal funding 
The Unit should work with OIG to repay the $5,107 Federal matching 
funds related to expenditures associated with investigating the five 
ineligible cases. 
Repay Federal matching funds spent on unallowable 
expenditures for salary, fringe, and associated indirect costs 
The Unit should work with OIG to repay the $18,821 Federal matching 
funds related to unallowable expenditures for salary, fringe, and associated 
indirect costs during the review period. 
 
 
 
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   15 
   
   
UNIT COMMENTS AND OFFICE OF INSPECTOR GENERAL 
RESPONSE 
The Wisconsin Unit concurred with all six of our recommendations. 
Regarding the first recommendation, the Unit stated that it has 
implemented policies requiring written approval for all case openings and 
written documentation of quarterly supervisory case reviews. 
Regarding the second recommendation, the Unit stated that it has 
established policies requiring the reporting of convictions and adverse 
actions to Federal partners within 30 days of sentencing. 
Regarding the third recommendation, the Unit stated that it has 
implemented a policy regarding basic training for professional staff. 
Regarding the fourth recommendation, the Unit explained that it has taken 
several steps to improve internal controls related to personnel and 
accounting, including (1) quantifying and paying actual Unit costs where 
possible and appropriate; (2) implementing a practice whereby the Unit 
director personally approves all Unit expenses; and (3) implementing a 
practice whereby the Unit director reviews, approves, and certifies 
quarterly Federal Financial Reports. 
Regarding the fifth and sixth recommendations, the Unit agreed to 
reimburse Federal matching funds associated with (1) investigating 
ineligible cases and (2) unallowable expenditures for salary, fringe, and 
associated indirect costs by offsetting the current-year grant.  
The Units comments are provided in Appendix D. 
   
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   16 
   
   
APPENDIX A 
2012 Performance Standards36  
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 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. 
                        ____________________________________________________________ 
36 77 Fed. Reg. 32645, June 1, 2012. 
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   17 
   
   
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). 
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 PRACTICABLE, 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.  
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. 
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. 
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 
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   18 
   
   
4.  The number of referrals received by the Unit and the number of referrals by the Unit to other agencies. 
5.  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. 
6.  The number of criminal convictions and the number of civil judgments. 
7.  The dollar amount of overpayments identified. 
8.  The dollar amount of fines, penalties, and restitution ordered in a criminal case and the dollar amount of 
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. 
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 MEMORANDUM OF UNDERSTANDING (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 
Centers for Medicare & Medicaid Services (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. 
 
 
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   19 
   
   
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.   
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.  
   
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   20 
   
   
APPENDIX B 
Unit Referrals by Referral Source for FYs 2013 Through 2015 
 
   
FY 2013  FY 2014  FY 2015 
Abuse/  Abuse/  Abuse/ 
Referral Source  Fraud  Fraud  Fraud  Total 
Neglect1  Neglect  Neglect 
State Medicaid agency  
26  1  17  2  57  40  143 
Program Integrity Unit 
State Medicaid agency - 
4  27  8  13  0  0  52 
other 
     
Managed care 
0  0  0  0  0  0  0 
organizations 
State survey and 
0  0  0  0  0  0  0 
certification agency 
Other State agencies  0  0  1  0  2  0  3 
Licensing board  0  0  0  0  0  0  0 
Law enforcement    0  2  0  0  1  0  3 
OIG    0  0  0  0  0  0  0 
Prosecutors  1  0  0  0  0  0  1 
Providers  1  1  0  0  0  0  2 
Provider associations  0  0  0  0  0  0  0 
Private health insurer  0  0  0  0  0  0  0 
Ombudsman  0  0  0  0  0  0  0 
Adult protective services     0  0  0  0  0  0  0 
Private citizens  10  5  2  0  6  2  25 
MFCU hotline2  0  0  0  0  NA  NA  0 
Anonymous3  NA  NA  NA  NA  0  0  0 
Other4  82  1  59  1  56  0  199 
   Total  124  37  87  16  122  42  428 
 
   Annual Total  161  103  164 
Source:  OIG analysis of Unit Quarterly and Annual Statistical Reports, FYs 20132015, 2016. 
1 The category of referrals of abuse and neglect includes referrals regarding misappropriation of patients funds. 
2 The referral source MFCU hotline was not a category reported on the FY 2015 Annual Statistical Report. 
3 The referral source Anonymous was not a category reported on the FY 2013 and FY 2014 Quarterly Statistical Reports.  
4 The referral source Other includes qui tam Fals e Claims Act cases, a referral from a Medicaid  Personal Care waiver program, and a 
referral from the California Department of Justice.
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   21 
   
   
APPENDIX C 
 
Detailed Methodology 
Data collected from the seven sources below was used to describe the 
caseload and assess the performance of the Wisconsin MFCU. 
Data Collection  
Review of Unit Documentation.  Prior to the onsite visit, we analyzed 
information regarding the Units investigation of Medicaid cases, 
including 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 and annual statistical reports, its annual reports, its recertification 
questionnaire, its policy and procedures manual, and its memorandum of 
understanding with the State Medicaid agency.  We requested any 
additional data or clarification from the Unit as necessary. 
Review of Unit Financial Documentation.  To evaluate internal control of 
fiscal resources, we reviewed policies and procedures related to the Units 
budgeting, accounting systems, cash management, procurement, property, 
and staffing.  We reviewed records in the Payment Management 
System (PMS) 37 to identify unusual patterns of drawdown amounts, and 
we reviewed Federal Financial Reports (FFRs) that the Unit submitted for 
FYs 2013 through 2015.  We also obtained the Units claimed grant 
expenditures from its FFRs and the supporting schedules.  We requested 
from the Unit and reviewed its supporting documentation for the selected 
items from the supporting schedules.   
We selected three purposive samples to assess the Units internal control 
of fiscal resources.  The three samples included the following:   
1.  To assess the Units expenditures, we selected a purposive sample 
of 56 of the 952 transactions within the direct cost categories 
across the 3 years of the review period.  We reviewed supporting 
documentation to determine whether the costs claimed were 
allowable, allocable, and reasonable, in accordance with Federal 
regulations.   
                        ____________________________________________________________ 
37 The PMS is a grant payment system operated and maintained by the Department of 
Health and Human Services, Program Support Center, Payment Management 
Services.  The PMS provides disbursement, grant monitoring, reporting, and cash 
management services to awarding agencies and grant recipients, such as MFCUs. 
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   22 
   
   
2.  To assess inventory, we selected and verified a purposive sample of 
24 items from the current inventory list of 91 items.   
3.  To assess employee time and effort, we reviewed timecard records 
from 3 pay periods across the 3 years of the review period for all 
Unit employees on staff. 
Interviews with Key Stakeholders.  In May and June 2016, we interviewed 
key stakeholders including officials in the U.S. Attorneys Offices, the State 
Attorney Generals Office, and other State agencies that interacted with the 
Unit (i.e., the Medicaid Program Integrity Unit, the Office of Caregiver 
Quality, and the State Long-Term Care Ombudsman).  We also interviewed 
an investigator from OIGs Region V office who works regularly with the 
Unit, as well as officials from the Internal Revenue Service and the U.S. 
Department of Labor.  The interviews focused on the Units relationship and 
interaction with OIG and other Federal and State authorities, and identified 
opportunities for improvement.  We used the information collected from 
these interviews to develop subsequent interview questions for Unit 
management. 
Survey of Unit Staff.  In May 2016, we conducted an online survey of all 
nine nonmanagerial Unit staff (i.e., auditors, attorneys, and support staff).  
The response rate was 100 percent.  Our questions focused on Unit 
operations, 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 during the onsite review in 
June 2016.  We interviewed the Units director and investigator supervisor.  
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.  We requested that 
the Unit provide us with a list of cases that were open at any point during 
FYs 2013 through 2015.  For the 722 open cases, we requested data 
including, but not limited to, the current status of the case; whether the 
case was criminal, civil, or global; and the date on which the case was 
opened.  Because global cases are civil false claims actions that typically 
involve multiple agencies, such as the U.S. DOJ and a group of State 
MFCUs, we exclude those cases from our review of a Units case files.  
Therefore, we excluded from our list 225 cases that were categorized as 
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   23 
   
   
global.  We also excluded 32 cases that had been opened after the end of 
our review period, 3 cases that had been closed prior to the beginning of 
our review period, and 6 cases that were duplicated in the population.  
From the universe of 456 cases, we selected a purposive sample of 
16 cases:  15 cases categorized as misappropriation of patient funds and 
1 criminal case.  We reviewed 14 of the 16 cases while on site; the Unit 
could not locate the remaining 2 case files.  We conducted this review of 
14 cases because of concerns identified in Unit staff surveys prior to the 
onsite review.   
From the remaining 440 cases, we selected a simple random sample of 
110 cases for review.  From this initial sample of 110 case files, we 
selected a simple random sample of 55 files for a more in-depth review of 
selected issues, such as the timeliness of investigations and case 
development.   
Sixty-five sampled cases were not reviewed.  Fifty-eight cases were global 
cases, and two cases did not represent cases investigated by the Unit.  The 
Unit could not locate the files for remaining five cases.  After excluding 
the ineligible cases, we reviewed a total of 45 case files, for which all of 
the cases had been open long enough to require supervisory review.  Thirty 
of the 45 reviewed cases had been closed.  After receiving our preliminary 
unsigned draft report, the Unit provided comments identifying 4 of the 
45 cases as ineligible for supervisory reviews.  Specifically, the Unit 
categorized the cases as qui tams for which the Unit was neither the lead 
investigator nor lead prosecuting attorney.  We subsequently excluded 
those four cases.38 
Onsite Review of Unit Operations.  During our June 2016 onsite visit, we 
reviewed the Units workspace and operations.  Specifically, we visited 
the Unit headquarters in Madison.  While onsite, we observed the Units 
offices and meeting spaces; the security of data and case files; the 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, or policy 
transmittals.39 
   
                        ____________________________________________________________ 
38 The additional exclusion from the sample left 41 eligible cases for review out of the 
110 sampled cases.  Twenty-eight of the cases were closed. 
39 All relevant regulations, statutes, and policy transmittals are available online at 
http://oig.hhs.gov/fraud/medicaid-fraud-control-units-mfcu. 
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   24 
   
   
APPENDIX D 
Unit Comments 
 
   
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   25 
   
   
 
   
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   26 
   
   
 
   
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   27 
   
   
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, and Jennifer King, Deputy Regional Inspector General; 
and in consultation with Richard Stern, Director of the Medicaid Fraud 
Policy and Oversight Division. 
Tricia Fields, of the Kansas City regional office, served as project leader 
for this study.  Other Office of Evaluation and Inspections staff who 
conducted the review include Dana Squires.  Other Medicaid Fraud Policy 
and Oversight Division staff who participated in the review include 
Frantzy Clement.  Office of Investigations staff also participated in the 
review.  Office of Audit Services staff who conducted a financial review 
include Dave Markulin and Laura Behnke.  Central office staff who 
contributed include Kevin Farber, Lonie Kim, Joanne Legomsky, and 
Christine Moritz. 
Wisconsin State Medicaid Fraud Control Unit:  2016 Onsite Review (OEI-07-16-00240)   28 
   
Office of Inspector General
http://oig.hhs.gov  
 
The mission of the Office of Inspector General (OIG), as mandated by Public Law 95452, 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 individuals 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 individuals.  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.