February 19,  2010

            LANSING -  Michigan Attorney General Mike Cox today praised the creation of a state Medicaid Inspector General, a move to take the fight against Medicaid fraud to the next level that he called for with proposed legislation in July, 2009.

"Michigan tax payers are being fleeced for millions in fraud, waste and abuse every year when families can afford it least," said Cox. "I fully support Governor Granholm's creation of an Inspector General because it will help us save millions of tax dollars and ensure care is available for those who need it.  I look forward to working with the Governor and the Legislature to ensure this program has the teeth to make the changes that other states have so successfully used to save hundreds of millions of dollars."

Cox proposed legislation in July, 2009 sponsored by Senator Roger Kahn and Representative Bob Genetski to create an independent Medicaid Inspector General to root out fraud, waste and abuse.  Governor Jennifer Granholm today issued Executive Order 2010-1, following Cox's lead and creating such an office.

Legislation may still be needed to strengthen and fully implement the office.  Cox said he is looking forward to seeing the details of the E.O. to ensure the OMIG can be as effective as possible.

Under Cox's previous proposal, OMIG would be empowered to oversee and audit Medicaid system contracts, perform on-site inspections and audits of facilities where records are kept by Medicaid recipients, accept and investigate complaints from the public, subpoena and enforce the participation of witnesses and refer criminal and civil cases to the Attorney General. OMIG would operate independently from MDCH, and its leader would be appointed directly by the governor to ensure autonomy from state Medicaid program administrators.

Federal authorities have been critical of the less-than-aggressive efforts of state Medicaid integrity programs to root out fraud and abuse, which led to the creation of the State of New York's program in 2005. There, the state government also created an independent inspector to ensure a more aggressive oversight system. Its Inspector General observed at the time, "that co-location of functions creates an obvious and inevitable conflict, as pressure to pay providers constantly battles with efforts to ensure monies are not misspent."

Cox said that New York's success---it recovered $551 million in 2008---was a prime example of Michigan falling behind other states which are using innovations to save money. Other states are also using some type of independent Medicaid Inspector General, including: Texas, Illinois, Florida, Kansas, and New Jersey.

Attorney General Cox is a leader on fighting Medicaid fraud. He previously proposed Michigan's Medicaid Whistleblower's Act statute, which became law in 2005.

If you suspect fraud, please contact the Health Care Fraud Division Hotline at 800-24-ABUSE (800-242-2873) or visit the Attorney General's website at  www.michigan.gov/ag.

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ATTACHED: July 2009 Press Release:  Cox Proposes Innovative Plan to Attack Medicaid Fraud