The function of Medicaid Fraud Control Units (MFCUs or Units) is to investigate and prosecute Medicaid provider fraud and patient abuse or neglect. The Social Security Act (SSA) requires each State to effectively operate a MFCU, unless the Secretary of Health and Human Services (HHS) determines that (1) the operation of a Unit would not be cost-effective because minimal Medicaid fraud exists in a particular State; and (2) the State has other adequate safeguards to protect beneficiaries from abuse or neglect. In fiscal year (FY) 2020, all 50 States, the District of Columbia, Puerto Rico, and the U.S. Virgin Islands operated MFCUs. MFCUs are funded jointly by Federal and State Governments. Each Unit receives a Federal grant award equivalent to 90 percent of total expenditures for new Units and 75 percent for all other Units. In FY 2020, combined Federal and State expenditures for the Units totaled approximately $306 million, of which approximately $230 million represented Federal funds.
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