State lawmakers are calling for stronger efforts to investigate fraud and abuse in North Carolina’s Medicaid system. A state House committee held a nearly three-hour hearing Thursday on the topic, questioning Attorney General Jeff Jackson and Health and Human Services Secretary Dev Sangvai.
Rep. Grant Campbell, R-Cabarrus, says his staff found several examples of suspicious billing from Medicaid providers. One appeared to be headquartered in an abandoned storefront, and another reported high travel expenses and cash withdrawals.
“Rooting out waste, fraud and abuse isn’t just a fiscal issue, it is a moral one,” Campbell said. “Every dollar misused is a dollar not spent on a child with autism, a senior needing care or a patient waiting for treatment. … We keep talking about how we have no money to look into this, and we had two staffers with Google and an Excel sheet in less than two…
PAYROLL & HR CONTROLS (PREVENTING “GHOST” SCHEMES)
Payroll fraud is often the hardest to detect because it “looks” like a normal business expense.
- Segregation of Duties (SoD): The person who adds new employees to the system must not be the same person who approves the monthly pay run.
- Mandatory Vacation Policy: Require all financial and HR staff to take 5–10 consecutive days of leave annually. Fraud often surfaces when the perpetrator isn’t there to “hide” the trail.
- Ghost Employee Audit: Perform a quarterly “Headcount Reconciliation” where managers must physically verify every name on their payroll list exists.
- Self-Pay Blocking: Ensure the payroll software has a hard-coded block preventing administrators from editing their own salary or bank details.