Health Law Daily Wrap Up, AUDITS AND MONITORING—OIG REPORTS: Vermont Medicaid Fraud Control Unit generally adheres to standards, (Oct 24, 2025)

By Robert Margolis, J.D.

The report found the unit could improve in such areas as increasing fraud referrals and implementing a more efficient case management system.

The HHS Office of Inspector General (OIG) has issued the report of its inspection of the Vermont Medicaid Fraud Control Unit (the “Unit”) for the 2022-2024 calendar years, finding that the Unit is meeting many of the quality standards used for measuring performance, while also noting areas for improvement. The OIG found that the Unit has a continuous case flow, reporting 32 indictments, 28 convictions, and 10 civil settlements for those fiscal years, and recovered about $1.3 million in criminal and civil recoveries over that period. The Unit also generally complies with applicable laws and regulations, has adequate staffing, good training, and good relationships with federal law enforcement providers. However, the OIG found areas where the Unit can improve, including increasing fraud referrals and modernizing its inefficient case management system. The OIG made four recommendations, all of which the Unit agreed with (OIG Report, No. OEI-07-24-00340, Oct. 7, 2025).

Medicaid fraud units. Each state, Puerto Rico, the District of Columbia, and the U.S. Virgin Islands operates its own Medicaid provider fraud unit, which investigates fraud and patient abuse or neglect. The units, funded jointly by federal and state governments, then prosecute those cases under state law or refer them to other prosecuting offices. The OIG administers the grant award to each state’s unit and provides oversight. Included in the oversight is an annual recertification review, in which the OIG assesses a unit’s performance as measured by its adherence to published standards and its compliance with relevant laws, regulations, and OIG policy.

Vermont’s Unit is located within the state’s Office of the Attorney General, and employs three attorneys, three investigators, two auditors, and a paralegal. Between fiscal years 2022-2024, the Unit spent approximately $4.5 million, approximately $1.1 million of which was the state share.

Inspection method. The OIG conducted an onsite inspection of the Unit in October 2024, reviewing data and information from seven sources. OIG applied published performance standards to assess the Unit’s operations and performance, though it did not measure against every performance indicator for every standard.

Findings. The OIG found that the Unit generally complies with applicable standards for performance, while noting several areas for improvement. Specifically, the OIG found that the Unit has a continuous case flow, reporting 32 indictments, 28 convictions, and 10 civil settlements for those fiscal years, and recovered about $1.3 million in criminal and civil recoveries over that period. It assessed the Unit’s performance using twelve performance standards.

Recommendations. The OIG recommended that the Unit take steps to (1) build upon efforts to increase fraud referrals form relevant partners, (2) implement a comprehensive case management system, (3) develop and implement a plan to improve communication and coordination with the OIG and other federal partners, and (4) take steps to timely report all adverse actions to federal partners. The Unit agreed with these recommendations.

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