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S E N A T E B I L L N o. 5 9 8
SENATE BILL No. 598
September 7, 2011, Introduced by Senators KAHN, PAPPAGEORGE, PROOS, SCHUITMAKER andEMMONS and referred to the Committee on Appropriations.
A bill to create the office of medicaid inspector general; toprescribe the manner of appointment and qualifications of themedicaid inspector general; to prescribe the powers, functions, andduties of the office of medicaid inspector general; to transfer andassign staff and other resources to the office of medicaidinspector general; to allow for appointment of deputies,assistants, and other officers and employees as may be needed toperform the duties and responsibilities of the office of medicaidinspector general; to allow for the office of medicaid inspectorgeneral to enter into contracts; to provide access to informationpertaining to the responsibilities of the medicaid inspectorgeneral; to authorize investigation into the administration ofprograms and operations of the Michigan medicaid system; to
203282'11 LTBauthorize the medicaid inspector general to review and approvecontracts, policies, and procedures pertaining to medicaid; and tomandate assistance and cooperation from state and local entitiesand to prescribe the powers and duties of certain state departmentsand agencies.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 1. This act shall be known and may be cited as the
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"Michigan medicaid inspector general act".
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Sec. 2. As used in this act:
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(a) "Abuse" means practices that are inconsistent with sound
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fiscal, business, or medical practices or violate department
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policies and procedures and that result in unnecessary costs to
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medicaid, result in reimbursement for services that are not
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medically necessary or fail to meet professionally recognized
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standards for health care, or result in waste.
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(b) "Department" means the department of community health.
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(c) "Director" means the director of the department.
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(d) "Fraud" means any deception or misrepresentation made by
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any person who knows or should have known that the deception could
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result in unnecessary or inappropriate cost to the medicaid
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program, including any act that constitutes fraud or submission of
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a false claim under applicable federal or state law.
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(e) "Inspector" means the medicaid inspector general created
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in section 3.
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(f) "Investigation" means the thorough and systematic inquiry
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into potential fraud, abuse, inappropriate billing or use of
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services, policy or contractual violations, or illegal acts
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303282'11 LTBcommitted by any medicaid funds recipient.
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(g) "Medicaid" and "medicaid program" mean the program for
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medical assistance for the medically indigent provided in
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accordance with the social welfare act, 1939 PA 280, MCL 400.1 to
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400.119b, that includes the program for medical assistance
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established under title XIX of the federal social security act, 42
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USC 1396 to 1396w-2, and administered according to the state plan.
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(h) "Medicaid fraud control unit" means the certified medicaid
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fraud control unit in the office of the attorney general.
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(i) "Medicaid funds recipient" means any person or entity,
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public or private, that provides medical care, services, or
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supplies paid for, directly or indirectly, by medicaid or that
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receives or administers medicaid funds paid out under the state
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plan. Medicaid funds recipient includes, but is not limited to,
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governmental units, providers, contractors, suppliers, and medicaid
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managed care organizations, and their subcontractors.
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(j) "Office" means the office of medicaid inspector general
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created in section 3.
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Sec. 3. (1) The office of medicaid inspector general is
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created as an agency within the department. The department is the
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single state agency for the administration of the medical
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assistance program in Michigan. The office of medicaid inspector
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general shall assume, exercise, and be responsible for the
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department's duties as the single state agency with respect to all
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of the following:
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(a) Prevention, detection, and investigation of fraud and
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abuse within the medicaid program, including fraud or abuse within
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