A report issued in late September says that state and federal authorities have made billions of dollars in recent years by settling Medicaid fraud cases. The report from the consumer group Public Citizen states that in the first half of 2012 alone the federal and state governments have recovered an estimated $6.6 billion.
Many of these cases involve drug makers accused of defrauding Medicaid by artificially fixing prices for drugs covered by the joint state and federal healthcare program. Price-fixing was the most single common violation that occurred from November of 2010 until July of 2012. The largest single penalties were associated with companies using unlawful promotional techniques for drugs associated with Medicaid.
Government authorities reached a total of 74 settlements between November 2010 and July 2012, for a total revenue of about $10.2 billion. About two thirds of those payments came from settlements reached with pharmaceutical giants Johnson & Johnson, Abbott, and GlaxoSmithKline.
The report also detailed how since 1991 about 17 states have recovered funds equal to or greater than the total amount they have spent on their Medicaid fraud enforcement efforts. At least one state earned as much as $84 in fraud settlements for every dollar they spent on Medicaid fraud enforcement. Alabama, Arkansas, Hawaii, and South Carolina had the greatest return on their investigative and enforcement efforts.