Fallout from a Medicaid fraud case discovered because of a murder at an assisted living community had an outsized effect on fraud-related criminal monetary recoveries by state Medicaid Fraud Control Units for the second consecutive year, suggests the latest annual report released by the Department of Health and Human Services Office of Inspector General.

Efforts by state MFCUs resulted in a total of nine criminal convictions and almost $1.2 million in criminal monetary recoveries for fraud or resident abuse or neglect related to assisted living in fiscal year 2020, the year covered by the report.

Of that total, investigations of facility-related Medicaid fraud in assisted living by the MFCUs in 2020 led to one criminal conviction and recoveries of more than $1.1 million, the report noted.

The amount for fraud-related criminal recoveries is less than the amount for 2019, which was $2,088,948, but it is much greater than noted in other recent years’ reports. For fiscal year 2018, for instance, $20,599 in such recoveries was reported; in 2017, the amount was $123,880, and in 2016, the number was $9,380.

Case in Alaska

As in 2019, the 2020 figure is due mainly to a fraud case in Alaska discovered after a murder at an assisted living facility, government officials told McKnight’s Senior Living.

As McKnight’s Senior Living previously reported, the case, State of Alaska v. Margaret Williams, began after a resident of the Eye to Eye Assisted Living Home, Gilbert Nashookpuk, murdered a caretaker in November 2015. He subsequently was sentenced to 60 years in prison.

Eye to Eye ALH was operated by Margaret Williams and her company, Flamingo Eye LLC, with assistance from Williams’ daughter, Princess Turay, and others.

“The Anchorage police department solved that murder quickly, but then licensing … went in and said, ‘We see that you billed for three caretakers. We want to talk to the other caretakers to see if they feel safe,” Alaska Assistant Attorney General Eric Senta, who prosecuted the case, previously told McKnight’s Senior Living. “And Margaret Williams and Princess Turay both said, ‘Oh, she was the only one working at the time.’ And licensing said, ‘Wait a minute. You’ve been billing for three, and you’re telling us only one was working?’ So that’s when it came on to our desk.”

In May 2019, Flamingo Eye was sentenced to pay a fine of up to $2.05 million for the fraud, after Williams and others were convicted of billing Medicaid for services not provided to disabled people residing in their assisted living facilities. (Read more about the case here.) That’s the amount that was reflected in the HHS OIG report for 2019.

But on top of fines levied against the defendants after conviction, the government was seeking $1.1 million in restitution. A judge granted the state’s request, and that’s the amount that shows up in the 2020 report, Senta told McKnight’s Senior Living this week.

“The restitution reflects approximately $400,000 in residential habilitation fraud. The defendants were billing for high-paying supported living when the recipient was living in a group home and not receiving the services defined as supported living,” he said. “The remaining $700,000 reflects fraud for dayhab. The defendants were billing on days when the recipients did not go out, were inflating the number of hours that the recipients stayed out, and billing for higher-paying one-on-one dayhab when providing nominal group dayhab.”

Fiscal year 2020 also included two civil settlements or judgments and $577,506 in civil recoveries related to fraud in assisted living.

Across the country during 2020, according to the HHS OIG report, assisted living resident abuse or neglect investigations by the MFCUs led to eight criminal convictions and recoveries of $45,093. There was one civil settlement or judgment and civil recoveries of $4,788 related to resident abuse or neglect in assisted living.

table

At the end of the year, 241 criminal cases related to assisted living resident abuse or neglect remained open, according to the OIG, and 57 criminal cases and 11 civil cases involving assisted living-related fraud remained open.

Other types of facilities, programs, providers

The OIG report also details abuse, neglect and fraud cases and outcomes related to other types of facilities as well as programs and providers. Personal care services attendants and agencies were convicted of fraud more than any other provider type, accounting for 47% of total convictions, according to the OIG. Nurse aides, including certified nursing assistants, were convicted for abuse and neglect more than any other provider type, accounting for 56% of total convictions, the agency said.

Across all settings and positions noted in the report, there were 1,017 convictions, 786 civil settlements and judgments, $173 million in criminal recoveries and $855 million in civil recoveries. California had the highest number of investigations, Pennsylvania had the highest number of indictments and convictions, New York had the highest number of civil settlements and judgments, and Texas had the highest dollar amount in recoveries. (State statistics are in this interactive map and this table.)

Unit efforts involving nursing facilities led to a total of 12 criminal convictions, 18 settlements or judgments and more than $25 million in criminal and civil recoveries in 2020.

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