Sen. Ashley Moody Proposes Bill Letting States Prosecute Medicaid Fraud Recipients

Sen. Ashley Moody, R-Fla., is introducing the STOP FRAUD in Medicaid Act, a federal bill that would give state attorneys general and Medicaid Fraud Control Units explicit authority to investigate and prosecute Medicaid beneficiaries who receive fraudulent kickbacks or benefits, not just providers. Moody says her experience as Florida attorney general showed that only going after providers leaves a "small fish" tier of fraud untouched, as federal prosecutors often decline lower-dollar recipient cases and instead rely on anti‑kickback laws. Her office cites Minnesota as a prime example, where years of alleged kickback‑driven fraud in Medicaid‑funded autism services and child care have prompted a new state audit faulting the Department of Human Services for failing to properly probe kickback claims and recommending that kickbacks be clearly defined as fraud in state rules. Minnesota House Fraud Prevention Committee Chair Kristin Robbins, a Republican now running for governor, called the lack of accountability for the "rampant fraud" in the state "astounding," reflecting broader political pressure to tighten enforcement after providers allegedly billed millions while luring families with payments or benefits tied to enrollment. The measure would effectively push more front‑line fraud enforcement down to state AGs and MFCUs, raising questions about how aggressively states might pursue low‑income recipients and what guardrails, if any, would distinguish organized kickback schemes from individual eligibility errors.