Corporate Compliance

Medicaid managed care plan pays $26 million to settle false claims charges

Compliance Monitor, February 9, 2011

CareSource, CareSource Management Group Co., and CareSource USA Holding Co. have agreed to pay the United States and the state of Ohio $26 million to resolve allegations that they caused Medicaid to pay for assessments and case managements they did not provide, according to a Department of Justice (DOJ) press release.

CareSource provides managed care benefits to Medicaid beneficiaries in Ohio, Indiana, and Michigan. Between January 2001 and December 2006, CareSource entities allegedly failed to provide required screening, assessment, and case management for beneficiaries with special healthcare needs, and allegedly received Medicaid funds to which they were not entitled. The CareSource entities also allegedly submitted false data to the state of Ohio so it appeared they were providing the required services.

Laura Rupert and Robin Herzog, former CareSource employees, filed a suit against CareSource on behalf of the United States. The False Claims Act’s qui tam provision allows private persons to file fraud suits on behalf of the United States and share in any recovery. Rupert and Herzog will receive approximately $3.1 million for their efforts.

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