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October 19, 2011

The Office of the State Comptroller released an audit of the state's largest Medicaid health maintenance organization, Horizon NJ Health, criticizing it for lax pursuance and reporting of fraud and abuse.

According to the audit, HNJH recovered only $188,207 from fraud investigations during the two-year period 2009-2010 while receiving $1.3 billion a year from the state. Sen. Loretta Weinberg (D-Bergen) said the national rate of Medicaid fraud is about three percent. Thus, statistically, Horizon would have been expected to recover more than $75 million during that period.

The state requires Medicaid HMOs to set up special investigative units to root out fraud from healthcare providers, pharmacies, and individuals. The audit suggested that Horizon was not aggressively pursuing fraud and abuse, and when it did find abuses it was not reporting them to the state. Horizon denies that last allegation, saying that the reported data is misleading due to different timing of reports.

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