Fraud Prevention Tips


United States Department of Health and Human Services Office of Inspector General (OIG)

The OIG has issued guidance to providers on how to avoid health care fraud and abuse.

Anti-Fraud Program

The Molina Healthcare Anti-Fraud Program is responsible for maintaining a comprehensive process for investigating and auditing questionable activities of possible detriment to the health plan. The Anti-Fraud Program is responsible for the detection, prevention, investigation, and reporting of potential fraud, waste and abuse cases. Anti-Fraud Program initiatives are in accordance with federal and state statutes and regulations. In keeping with the law, the program is also required to report potential fraud, waste and abuse to appropriate regulatory and/or law enforcement agencies.

What is Fraud?

An intentional deception or misrepresentation made by an entity or person, including but not limited to, a managed care organization, subcontractor, provider or client with the knowledge that the deception could result in some unauthorized benefit to himself or to some other previously described entity or person. It includes any act that constitutes fraud under applicable federal or state law.

What is Waste?

Health care spending that can be eliminated without reducing the quality of care.  Quality waste includes overuse, underuse, and ineffective use.  Inefficiency waste includes redundancy, delays, and unnecessary process complexity.  Example: the attempt to obtain reimbursement for items or services where there was no intent to deceive or misrepresent, however the outcome of poor or inefficient billing methods (e.g., coding) causes unnecessary costs.

What is Abuse?

Provider practices that are inconsistent with sound fiscal, business or medical practices and result in unnecessary cost, in reimbursement for services that are not medically necessary, or in services that fail to meet professionally recognized standards for health care. Abuse also includes client or member practices that result in unnecessary costs. It includes any act that constitutes abuse under applicable federal or state law.

Why is it Important to Have an Anti-Fraud Program?

The Anti-Fraud Program investigates issues that affect Molina Healthcare and its ability to care for its Members.  It is imperative to protect Medicaid funds from fraudulent activity, as this program provides thousands of New Mexicans with medical services that would otherwise be out of reach. 

Who Commits Health Care Fraud, Waste and Abuse?

Anyone can commit fraud, waste and abuse. The Anti-Fraud Program will investigate any allegation involving a practitioner/provider, Member, or other entity that is suspected of having committed fraud, waste or abuse. Molina Healthcare will seek criminal prosecution and/or civil damages in cases where fraud, waste or abuse may have occurred.

Provider Fraud Examples

The types of questionable practitioner/provider schemes investigated by the Anti-Fraud Program include, but are not limited to, the following:

  • Altered claim forms, electronic claim forms, and/or or medical record documentation in order to get a higher level of reimbursement;
  • Balance billing, which is the practice of a practitioner/provider billing a member for all charges not paid for by the health plan; billing for a service using a credentialed/contracted practitioner/provider when the practitioner/provider who rendered services was not credentialed/contracted;
  • Billing for unnecessary diagnostics;
  • Billing under an invalid place of service in order to receive or maximize reimbursement;
  • Completing Certificates of Medical Necessity (CMNs) for Members not personally and professionally known by the practitioner/provider;
  • Continual waiving of co-payments;
  • Durable medical equipment overutilization;
  • Explanation of Benefit (EOB) mismatches, which is when a Member receives an EOB and identifies a service was billed that he/she did not receive;
  • Exhaustion of benefits;
  • False coding in order to receive or maximize reimbursement;
  • Falsifying documentation in order to get services approved;
  • Inappropriate billing of clinical trials;
  • Inappropriate billing of modifiers in order to receive or maximize reimbursement;
  • Inappropriately billing a procedure that does not match the diagnosis in order to receive or maximize reimbursement;
  • Inappropriately giving away “free” equipment that is then billed to the insurance company for reimbursement;
  • Not following incident to billing guidelines in order to receive reimbursement or maximize reimbursement;
  • Participating in schemes that involve collusion between a practitioner/provider and a Member, or between a supplier and a practitioner/provider, and result in high costs or charges;
  • Questionable prescribing practices;
  • Questionable transportation services;
  • Repeatedly violating the participation agreement, assignment agreement, and/or the limitation amount;
  • Rolling labs, which occurs when fictitious practitioner/provider offices are established and services are billed to the Member’s health plan;
  • Services not rendered or rendering services in a worthless or nearly worthless manner;
  • Soliciting, offering, or receiving a kickback, bribe, or rebate (e.g., paying for a referral of patients in exchange for the ordering of diagnostic tests and other services or medical equipment);
  • Unbundling services in order to get more reimbursement, which involves separating a procedure into parts and charging for each part rather than using a single global code;
  • Underutilization, which means failing to provide services that are medically necessary;
  • g, which is when a practitioner/provider does not bill the correct code for the service rendered and instead uses a code for a like service that costs more; and
  • Using the adjustment payment process to generate fraudulent payments.


Member Fraud Examples

The types of questionable Member schemes investigated by the Anti-Fraud Program include, but are not limited to, the following:

  • Benefit sharing;
  • Conspiracy to defraud Medicaid or other government programs;
  • Co-Payment evasion;
  • Doctor shopping occurs when a Member consults a number of practitioners/providers for the purpose of inappropriately obtaining services (e.g., multiple prescriptions for narcotics or other drugs);
  • Falsifying documentation in order to get services approved;
  • Forgery related to health care (e.g., prescription forgery or altering);
  • Identity theft
  • Improper coordination of benefits (e.g., Member fails to disclose multiple coverage policies in order to “game” the system);
  • Inappropriately utilizing transportation benefit (e.g., accessing ambulance services for a non-emergency; or, using the Medicaid transportation benefit when the Member has access to free transportation);
  • Misrepresentation of status by providing false personal information in order to illegally receive a benefit (e.g., prescription drug benefit);
  • Participating in schemes the involve collusion between a practitioner/provider and a Member, or between a supplier and a practitioner/provider, and result in high costs or charges;
  • Prescription diversion, which occurs when a Member obtains a prescription from a practitioner/provider for a condition that he/she does not suffer from and the Member sells the medication to someone else;
  • Prescription stockpiling is when a Member attempts to “game” his/her drug coverage by obtaining and storing large quantities of drugs to avoid out-of-pocket costs, to protect against period of non-coverage, or for purposes of resale on the black market;
  • Polypharmacy abuse, which occurs when a Member is obtaining narcotics or other drugs from multiple pharmacies in order to cover-up his/her drug seeking behavior;
  • Seeking services the Member is not eligible to receive; and
  • Theft


Reporting Fraud, Waste and Abuse

Anyone with information regarding potential fraud, waste and abuse affecting Molina Healthcare may make a referral to the Anti-Fraud Program. Referring entities have the right to remain anonymous. Information reported to the Anti-Fraud Program will remain confidential to the extent possible as allowed by law.

Molina Healthcare expressly prohibits retaliation against those, who in good faith, report potential fraud, waste and abuse to the Anti-Fraud Program. If you suspect health care fraud, waste and abuse, you may report the situation in writing or by telephone.

Anti-Fraud Program
Molina Healthcare of New Mexico
P.O. Box 3887
Albuquerque, NM 87190-9859
Confidential email: 
Albuquerque: (505) 341-7469
Toll free Compliance/Anti-Fraud Program Hotline: (800) 827-2973
Toll free fax: (866) 472-4580

When reporting an issue, please provide as much information as possible (i.e. suspect’s name, where the fraud may have happened, detail as to what criminal activity occurred and when). The more information provided to the Anti-Fraud Program, the better the chances the situation will be successfully reviewed and resolved.

You may also report Medicaid fraud to:

Medical Assistance Division    
Quality Assurance Bureau    
P.O. Box 2348      
Santa Fe, NM  87504-2348   
Local in Santa Fe:  (505) 827-3100
Toll free: (888) 997-2583

New Mexico Human Services Department
Office of Inspector General
Local in Albuquerque: (505) 827-8141
Toll free: (800) 338-4082

Medicaid Fraud Control Unit    
111 Lomas NW, Suite 300    
Albuquerque, NM 87102    
Local in Albuquerque: (505) 222-9000   
Toll free: (800) 678-1508

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