Criminal statutes and regulations Texas has no specific criminal statute concerning Medicaid fraud. Instead, OAG's Medicaid Fraud Control Unit relies on other state criminal statutes such as those for tampering with a governmental record or injuring a child or elderly person. Depending on the facts and the particular criminal statute used, penalties available to the state vary widely from misdemeanors to felonies. Several other states including Arkansas, New Mexico, Montana, and Pennsylvania have specific criminal sanctions against Medicaid fraud. These statutes create a range of offenses from petty misdemeanors to second-degree felonies, depending on the amount of money involved in the fraudulent activity.
Sanctions can include fines as well as incarceration.
Both states classify such a failure as a misdemeanor or a felony depending on the amount of money involved. New Mexico also levies felony criminal penalties for fraudulent activities that cause physical or psychological harm to Medicaid recipients. Such provisions ensure that prosecutors have the broadest possible range of criminal sanctions available. As these reports illustrate, fraud is increasingly common in managed care systems. This situation makes it more difficult for the state to detect instances of provider fraud, such as payments to unlicensed providers or billing for services never received.