Fraud, Waste, and Abuse

Detecting and Preventing Fraud, Waste, and Abuse

Managed-care health plans are responsible for detecting and preventing fraud, waste, and abuse.  Amendments to the Balanced Budget Act of 1997 (also known as the Medicaid Managed Care Rules) address or amend assorted managed-care policies for Medicaid health plans.

Fraud is defined as intentional deception or misrepresentation made by someone with the knowledge that the deception could result in an unauthorized benefit to himself, herself, or some other person.  It includes any act that constitutes fraud under applicable federal or state laws.

Abuse relates to provider practices that are inconsistent with sound fiscal, business, or medical practices and result in (a) unnecessary cost to the Medicaid program or (b) reimbursement for services that are not medically necessary or fail to meet professionally recognized standards for health care.  Abuse includes beneficiary practices that result in unnecessary cost to the Medicaid program.

Medicaid managed-care fraud means any type of intentional deception or misrepresentation made by an entity or person in a capitated managed-care organization (MCO) or other managed-care setting with the knowledge that the deception could result in some unauthorized benefit to the entity, himself or herself, or some other person.  Medicaid funds paid to an MCO, and then passed on to the subcontractors, are still Medicaid funds from a fraud and abuse perspective.  A provider is defined as any individual or entity that receives Medicaid funds in exchange for providing a service (MCO, contractor, or subcontractor).

Health care fraud, waste, and abuse can occur in many areas, including:

  • Procurement of the managed-care contract
  • Marketing, enrollment, and disenrollment
  • Underutilization of claim submission and billing procedures
  • Antitrust violations
  • Embezzlement and theft

Fraud can be committed by many entities, including:

  • Managed-care organizations
  • Contractors
  • Subcontractors
  • Providers
  • State employees
  • Medicaid beneficiaries and managed-care enrollees

The 2002 Balanced Budget Amendment requires that health plans:

  • Document policies and procedures.
  • Articulate a commitment to comply with state and federal regulations.
  • Designate a compliance officer and compliance committee.
  • Develop solid detection and reporting processes.
  • Provide education to employees, providers, and members.

Providers with questions about fraud, waste, and abuse should contact the Upper Peninsula Health Plan (UPHP) Customer Service or the UPHP Compliance Officer.

You may report possible fraud and abuse to:

UPHP Customer Service
853 West Washington Street
Marquette, MI 49855
1-800-835-2556

Michigan Department of Health and Human Services
Office of Inspector General
PO Box 30062
Lansing, MI 48909
Call Toll-Free at 855-MI-FRAUD (643-7283)

MDHHS Office of Inspector General online complaint form

UPHP Fraud, Waste, and Abuse Policies

Procedures to Detect Fraud and Abuse
(Policy and Procedure/Revised December 2015)

State and Federal False Claims Act, Whistle-Blower Protections
(Policy and Procedure/Revised December 2015)

Compliance and Fraud, Waste, and Abuse 

UPHP Compliance Guide 


Page Last Updated: 05/8/2017