Kentucky Fraud and Abuse

Passport by Molina Healthcare seeks to uphold the highest ethical standards for the provision of health care benefits and services to its members and supports the efforts of federal and state authorities in their enforcement of prohibitions of fraudulent practices by providers or other entities dealing with the provision of health care services.


  • As defined in KRS 205.8451: "Provider abuse" means, with reference to a health care provider, practices that are inconsistent with sound fiscal, business, or medical practices, and that result in unnecessary cost to the Medical Assistance Program established pursuant to this chapter, or that result in reimbursement for services that are not medically necessary or that fail to meet professionally recognized standards for health care. It also includes practices that result in unnecessary cost to the Medical Assistance Program. "Recipient abuse" means, with reference to a medical assistance recipient, practices that result in unnecessary cost to the Medical Assistance Program or the obtaining of goods, equipment, medicines, or services that are not medically necessary, or that are excessive, or constitute flagrant overuse or misuse of Medical Assistance Program benefits for which the recipient is covered.


  • Under applicable federal law or KRS 205.8451-KRS205.8483, “Fraud” means an intentional deception or misrepresentation made by a recipient or a provider with the knowledge that the deception could result in some unauthorized benefit to the recipient or provider or to some other person. It includes any act that constitutes fraud under applicable federal or state law


Federal False Claims Act, 31 USC Section 3279

The False Claims Act is a federal statute that covers fraud involving any federally funded contract or program, including the Medicaid programs. The act establishes liability for any person who knowingly presents or causes to be presented a false or fraudulent claim to the U.S. government for payment.

The term "knowing" is defined to mean that a person with respect to information:

  • Has actual knowledge of falsity of information in the claim;
  • Acts in deliberate ignorance of the truth or falsity of the information in a claim; or
  • Acts in reckless disregard of the truth or falsity of the information in a claim.


The act does not require proof of a specific intent to defraud the U.S. government. Instead, health care providers can be prosecuted for a wide variety of conduct that leads to the submission of fraudulent claims to the government, such as knowingly making false statements, falsifying records, double-billing for items or services, submitting bills for services never performed or items never furnished or otherwise causing a false claim to be submitted.


Deficit Reduction Act

The Deficit Reduction Act (“DRA”) was signed into law in 2006. The law, which became effective on January 1, 2007, aims to cut fraud, waste and abuse from the Medicare and Medicaid programs over the next five years.

Health care entities like Passport, who receive or pay out at least $5 million in Medicaid funds per year, must comply with DRA. As a contractor doing business with Passport, providers and their staff have the same obligation to report any actual or suspected fraud, waste or abuse. Health care entities must have written policies that inform employees, contractors, and agents of the following:

  • The Federal False Claims Act and state laws pertaining to submitting false claims;
  • How providers will detect and prevent fraud, waste, and abuse;
  • Employee protected rights as whistleblowers.


The Federal False Claims Act and the Medicaid False Claims Act have qui tam language commonly referred to as “whistleblower” provisions. These provisions encourage employees (current or former) and others to report instances of fraud, waste or abuse to the government. The government may then proceed to file a lawsuit against the organization/individual accused of violating the False Claims acts. The whistleblower may also file a lawsuit on their own. Cases found in favor of the government will result in the whistleblower receiving a portion of the amount awarded to the government.

The Federal False Claims Act and the Medicaid False Claims Act contain some overlapping language related to personal liability. For instance, the Medicaid False Claims Act has the following triggers:

  • Presents or causes to be presented to the state a Medicaid claim for payment where the person receiving the benefit or payment is not authorized or eligible to receive it;
  • Knowingly applies for and receives a Medicaid benefit or payment on behalf of another person, except pursuant to a lawful assignment of benefits, and converts that benefit or payment to their own personal use;
  • Knowingly makes a false statement or misrepresentation of material fact concerning the conditions or operation of a health care facility in order that the facility may qualify for certification or recertification required by the Medicaid program;
  • Knowingly makes a claim under the Medicaid program for a service or product that was not provided.


Whistleblower protections state that employees who have been discharged, demoted, suspended, threatened, harassed or otherwise discriminated against due to their role in furthering a false claim are entitled to all relief necessary to make the employee whole including:

  • Employment reinstatement at the same level of seniority
  • Two times the amount of back pay plus interest
  • Compensation for special damages incurred by the employee as a result of the employer’s inappropriate actions.


Affected entities who fail to comply with the law will be at risk of forfeiting all Medicaid payments until compliance is met. Passport Health Plan by Molina Healthcare will take steps to monitor Passport contracted providers to ensure compliance with the DRA.

Health care fraud includes but is not limited to the making of intentional false statements, misrepresentations or deliberate omissions of material facts from, any record, bill, claim or any other form for the purpose of obtaining payment, compensation or reimbursement for health care services.

Examples of Fraud and Abuse

By a Member

By a Provider

• Using someone else’s insurance card.

Falsifying codes or records, or altering claims.

• Forging a prescription.

Billing for services not rendered or goods not provided.

• Knowingly enrolling someone not eligible for coverage under their policy or group coverage.

Billing separately for services that should be a single service.

Providing misleading information on a or omitting information from an application for health care coverage, or intentionally giving incorrect information to receive benefits. .

Billing for services not medically necessary

Altering the billed amount for services. Altering the service date.

Overutilization: Medically unnecessary diagnostics, unnecessary durable medical equipment, unauthorized services, inappropriate procedure for diagnosis.





Other Provider Schemes

  • Knowingly and willfully solicits or receives payment of kickbacks or bribes in exchange for the referral of Medicare or Medicaid patients.
  • A physician knowingly and willfully referring Medicare or Medicaid patients to health care facilities in which or with which the physician has a financial relationship. (The Stark Law)
  • Balance billing - asking the patient to pay the difference between the discounted fees, negotiated fees, and the provider's usual and customary fees.


Preventing Fraud and Abuse

Passport and other State and Federal regulatory and law enforcement agencies are working together to help prevent fraud, waste, and abuse. Here are a few helpful prevention tips:

  • Do not give your Passport ID card or number to anyone except your doctor, clinic, hospital or other healthcare provider.
  • Do not let anyone borrow your Passport ID card.
  • Never lend your social security card to anyone.
  • When you get a prescription make sure the number of the pills in the bottle matches the number on the label.
  • Never change or add information on a prescription.
  • If your Passport ID card is lost or stolen, report it to Passport immediately.

Reporting Fraud and Abuse

You may report suspected cases of fraud and abuse to Passport ’s Compliance Officer. You have the right to have your concerns reported anonymously to Passport, the Kentucky State Attorney General’s Medicaid Fraud Control Unit, and/or The United States Office of Medicaid Inspector General. When reporting an issue, please provide as much information as possible. The more information provided the better the chance the situation will be successfully reviewed and resolved. Remember to include the following information when reporting suspected fraud or abuse:

  • Nature of complaint
  • The names of individuals and/or entity involved in suspected fraud and/or abuse including address, phone number, Medicaid ID number and any other identifying information.


 You can report fraud in several ways. You can contact Passport ’s Compliance Office:


You can also contact the Cabinet for Health and Family Services, Office of Inspector General:

  • Cabinet for Health and Family Services
    Office of Inspector General
    Division of Audits and Investigations
    275 East Main Street, 5 E-D
    Frankfort, KY 40621
    Toll-Free: (800) 372-2970