Unbiased Analysis of Today's Healthcare Issues

The Medicaid Integrity Program

Written By: Jason Shafrin - Sep• 20•10

One of President Obama’s biggest initiatives as part of health reform was to reduce fraud, waste and abuse in Medicare and Medicaid.  Today, I will discuss how the Medicaid program fights fraud at the federal level.

Because Medicaid is state-run, the States have typically been the ones responsible for ensuring efficient Medicaid operations. However, the Deficit Reduction Act of 2005 created the Medicaid Integrity Program (MIP) in section 1936 of the Social Security Act (the Act), and dramatically increased the Federal government’s role and responsibility in combating Medicaid fraud, waste and abuse.  CMS’ Medicaid Integrity Group (MIG) is administers MIP and regularly consults with the Medicaid Fraud & Abuse Technical Advisory Group (TAG) and its MIP advisory committee.  MIG’s key activities include: i) reviewing the actions of providers being reimbursed by Medicaid, ii) auditing claims for payment, iii) identifying overpayments, and iv) educating State Medicaid programs regarding payment integrity and quality of care.

Today, I will review some of MIP’s key components.


MIG’s organizational structure has four primary components.  The bullets below detail each components and their key role.

  • Office of the Director is the primary point of contact on Medicaid fraud and abuse within CMS.  They work closely with senior CMS leaders and oversee the preparation of the CMIP, MIP’s annual Report to Congress, and other MIP-related documents.
  • Division of Medicaid Integrity Contracting is in charge of the Audit, Review and Education Medicaid Integrity Contractors (MICs).
  • Division of Fraud Research and Detection provides research, statistical and data support both to the MIP and the States
  • Division of Field Operations (5 CMS Offices)is the largest branch with staff working out of the CMS regional offices in Atlanta, Chicago, Dallas, New York, and San Francisco.  The staff works closely with the MIP’s provider audit contractors and provides oversight, support and assistance to States’ program integrity efforts

Medicaid Integrity Contractors (MICs)

As mentioned above, MIG contracts with private firms for MICs to conduct much of their work.  Their are three types of MICs.  Review MICs mine MSIS data to identify potentially fraudulent claims and trends.  Common claim errors encountered include:  missing prescriptions, missing documentation, non-covered service, medically unnecessary service, incorrectly coded service, duplicate services, services provided by unapproved subcontractor, services billed in excess of those prescribed.

Once the Review MICs identify potentially fraudulent claims and/or providers, the Audit MICs conduct the audit.  They look for cases where services were not provided, improper billing codes were used, non-covered services were charged to Medicaid, or payments are not in accordance with federal law.  If they find evidence of malfeasance, the Audit MICs can make fraud referrals to HHS OIG who then would send to the Medicaid Fraud Control Units (MFCU).

Education MICs represent the third type of contractor.  CMS charges these firms with the education of State Medicaid integrity personnel including gap analysis of existing State education and training programs and the development of an educational curriculum on fraud detection processes.


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  1. Geoff says:

    Question… What is the ROI? It appears to be an impressive organizational structure but why? Is there really that much to be found ?

  2. Jason Shafrin says:

    ROI is return on investment. This is basically the amount of money the government saves by investing in anti-fraud activities.

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