Fraud fueling public benefits’ soaring costs
We offer a few examples — $5.2 million worth — why Masshealth and other assistance programs account for about 40% of the commonwealth’s operating budget.
About 25% ofmassachusetts’ residents, with the largest segment comprising those under 21, rely on Masshealth, the state’s Medicaid program, for their health care to some degree.
In a $53 billion annual spending plan, that’s a considerable amount of money, which also presents a considerable opportunity for fraud and other abuses of the system.
Two recent disclosures demonstrate the lengths businesses and individuals will go to siphon taxpayer funds through illicit means.
As the newspaper recently reported, a Leominster-based medical equipment supplier must pay $2.5 million restitution for debt- collection violations and improper billing of Masshealth clients.
Attorney General Andrea Campbell’s office said Regional Home Care had engaged in “unfair, deceptive and abusive” debt-collection practices, which included not informing consumers of their legal rights to dispute and obtain validation of their debts, and not informing consumers of their right to request the company not call their place of employment.
Additionally, the company allegedly deceived consumers into believing non-payment of their debtswould lead to action by attorneys or debt-collection agencies. The attorney general’s office said these practices violated state consumer law and debt collection regulations.
The AG’S office also claimed that Regional Home Care collected money from Masshealth for balances not owed or already paid.
“… As a result of this settlement, thousands of consumers who were harmed by this company’s actions will directly benefit, and our office will continue to protect consumers from predatory practices and scams,” Campbell stated.
The attorney general’s office said Regional Home Care had filed over 13,000 debt-collection lawsuits against consumers in Leominster District Court, claims filed despite the fact that 99% of the parties didn’t reside in that court district, nor had their contracts with the company executed there.
Campbell’s office said it was illegal to seek these judgments in Leominster District Court, instead of where the consumer resided or where the contract was executed.
As part of the settlement, Regional Home Care must vacate every consumer judgment it has reached in Leominster District Court, except for those against Leominster residents or judgments that had been satisfied.
The attorney general’s office said $2.1 million worth of judgments are expected to be vacated.
Regional Home Care also will be required to pay $500,000 to the state, plus another $9,000 in Masshealth client refunds. The company is also barred from selling, transferring or collecting on the judgments.
The AG’S office also said the company must come into compliance with federal and state laws, and change its business practices and reporting requirements.
Auditor finds Medicaid, SNAP fraud
Another executive-level office uncovered evidence of $2.7 million in public-assistance fraud.
The state auditor’s Bureau of Special Investigations unit found that sumof benefits and services, such as SNAP and Medicaid, were fraudulently obtained during the second quarter of fiscal 2023 alone.
A total of 1,136 cases during October, November and December 2022 were investigated. Of those, 255 — 22% — were found to be fraudulent, involving a total of $2,710,499.81 in funds, as reported by Springfield’s WLLP Ch. 22.
The BSI investigates any assistance programs administered by the Department of Transitional Assistance, the Department of Children and Families, and the Division of Medical Assistance, which administers Masshealth (Medicaid).
It also works with the Department of Early Education & Care. The investigations ensure taxpayer dollars are not being abused and that these assistance programs truly help people in need.
The following funds were fraudulently obtained in these assistance programs:
• Transitional Aid to Families with Dependent Children: $1,599,669.44
• Supplemental Nutrition Assistance Program: $770,697.40
• Medicaid: $283,156.08
• Department of Early Education & Care: $49,698.69
• Emergency Aid to the Elderly, Disabled, and Children: $7,278.20
Individuals found fraudulently applying for assistance funds are disqualified from programs and prosecuted in state and federal court.
We’re sure the state’s taxpayers appreciate the efforts of the attorney general and state auditor offices.
However, we don’t know whether any purloined benefits identified by the auditor will ever be recovered, or if that $5.2 million figure represents themajority of the fraud, or just the tip on the iceberg.
Remember, at the height of the COVID pandemic when unemployment soared, so did bogus claims for jobless benefits.
The Baker administration disclosed in May 2021 that a sophisticated international scam network had targeted the commonwealth’s and other states’ unemployment agencies, in apparent attempt to take advantage of those overwhelmed offices due to the skyrocketing job losses caused by the COVID-19 pandemic.
In July, the state’s Department of Unemployment Assistance reported that it had identified more than 58,000 bogus claims and had recovered a total of $158million.
How many more claims and money — then and now — escaped detection?