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Arizona AG Reports Gains in Medicaid Fraud Crackdown, Citing 92% Drop in Behavioral-Health Billing

The update underscores Arizona’s response to a $2.8 billion scheme that targeted Native people.

Overview

  • Arizona Attorney General Kris Mayes said Thursday that behavioral-health billing fell about 92% over two years, calling the decline evidence that the state’s crackdown is working.
  • The enforcement push has produced 140 indictments and millions recovered, after the state Medicaid agency froze payments to more than 100 providers and ordered a forensic audit of claims back to 2019.
  • Prosecutors say the scheme preyed on Native Americans who were recruited from tribal lands with promises of treatment, then billed for services that were never provided and, in some cases, held against their will.
  • Governor Katie Hobbs said AHCCCS will launch an AI-based prepayment review system in July to score Medicaid claims for fraud, waste, and abuse before money goes out.
  • A recent federal inspector general letter warned that weak Medicaid Fraud Control Units can put a state’s Medicaid funding at risk, a backdrop to Mayes’s clash with a Republican senator who argues prosecutions have been too slow.