What Is Medicaid Fraud?

Medicaid, and Medicaid fraud, are an ever increasing concern, and burden, for the tax payer in America.



For those of you who live outside of the US, Medicaid is a health program sponsored and funded by the government.

The bulk of this funding comes through local state taxation and only the poorest sectors in society qualify to receive such aid.

It is pretty well the case that anyone who works, even if it is only part-time and for minimum wage, will be exempt from claiming medicaid.

Obviously there will be some special cases, however, medicaid is generally aimed at the disabled, handicapped or homeless.

As the treatment that such people receives is ‘free’, it is generally accepted that the quality of service they receive is inferior to that which a ‘paying patient’ may reasonably expect.

I’m sure much could be made of the morality questions associated with such a two tier system of health care.


The fact that Medicaid is free has, perhaps unsurprisingly, led to an increase in related fraud.

Citizens will lie about incomes, or even create fake identities, in order to receive free health care.

For some, this may be because the cost to them is otherwise almost prohibitive but for many I would guess they are just looking to avoid paying for purely fraudulent and greed-driven reasons.

The amount of Medicaid that is applied for each year is increasing at a huge rate, requiring millions of dollars in taxes to fund itself.

This increases the tax burden on the honest citizen, as well as increasing national debt through the government’s contributions.


Is there an effective solution to the problem of medicaid fraud?

Sure, those who abuse or cheat the system can be prosecuted, but is that enough, and is it a long-term answer?

The world’s demographics are changing.

Ironically, improvements in health care have led to sharp increases in life expectancy.

In simple terms, this increases the number of aged people who are likely to need a free, cheap or subsidised health service whilst offering up proportionately less younger members of society to pay for it via taxation.

Should all countries of the world expect their people to buy health care insurance, with ever-increasing premiums, or can a National Health Service, such as we have here in the UK, continue to offer a system that is, in theory at least, funded by the state?

About Lee Munson

Lee's non-technical background allows him to write about internet security in a clear way that is understandable to both IT professionals and people just like you who need simple answers to your security questions.


  1. Well, it doesn’t sound like a perfect system but I think everyone should have healthcare and I don’t mind paying for others to have it. I pay taxes for so many things that I don’t agree with that I certainly wouldn’t mind this one.

    • For the most part I think it’s a good system but the shortfalls can be obvious at times – certain drugs and new procedures are so expensive that the service refuses to pay for them, leaving people to go abroad and pay or… die 🙁

  2. Health insurance is a big problem in the United States and is an important issue in the current Presidential campaign. Health insurance is usually provided through the employer, if it is provided at all. I believe that it should be provided to everyone just for being a citizen. And if insurance is not provided through employment is much too expensive for most people to afford. Fortunately, most states do have a program to insure children.

    When insurance is provided through an employer there is still an amount taken out of each paycheck and employers are across the board cutting what they pay to cover.

    I do know people on Medicare who may be exceptions to the usual people types of people who have it. I do not, however, know people who are lying to obtain it.

    I’m not sure if I actually answered the questions you asked in the article so I’m sorry if I went off topic.

    • Feel free to go off topic Kim.

      I don’t know if you know much about the health service in the UK?

      Those in work pay around 9% of their salary in National Insurance and are then entitled to free care, albeit of a poor standard and slow to obtain, in my opinion.

      The unemployed and long-term sick also receive the same service without contributing anything.

      Is such a system better or should people get a variable service dependent upon how much they are willing/able to pay?

      • I think it should be variable. One of the arguments against nationalized healthcare in the US is that the service will be poor. Everyone can be entitled to the same level of service but those who are willing and able can pay more for some sort of extra benefits.

        So, no matter what your salary is, it is 9%? If you earn a lot of money you are paying the same 9% for the same level of service?

        • Yes, so the more you earn the more you pay for the exact same service.

          Obviously those who are earning larger amounts often choose to pay for their own private medical policies but in essence the British health service is ‘free’ to all, regardless of contributions made, or the lack of the same.

        • Does the 9% come directly out of your paycheck or do you pay it in taxes later? And does it include mental health care?

        • Over a certain amount (about £80 pw I think) an employer is legally bound to deduct national insurance contributions at source.

          Yes, the service includes the full range of health care, including mental health.

        • I keep thinking of more questions. Does the 9% only cover the individual? How are children covered? For example, my crappy health insurance is paid for by employer although there are co-payments for doctor’s visits, emergency room visits, etc. If I add my daughter to the plan, then an amount is taken out of each check. I don’t know the current percentage because my ex provides her with health insurance as he has a better plan. It goes up for each individual added to the plan.

          Are prescriptions included? We usually have a separate plan for prescriptions, which can be really good or really bad depending on the employer. I don’t have any prescriptions but I think they cost $15 for standard medications.

        • Everyone is entitled to the free national health service so that includes all babies and children.

          Those who work and make more than £80 per week or so have the 9% deducted.

          What that means is that everyone who earns over that level is paying for their own health care and also contributing towards the cost of care for those who don’t pay into the system for whatever reason (young, unemployed, retired, etc).

          Prescriptions are kind of included – there is a charge (I’m not sure how much as I’ve not had one in years but I think it’s around $7) – which is a set amount, regardless of the drugs required.

          Obviously, if you need medication that costs less than that figure then you can just pay the regular cost instead.

          If your meds cost a lot more then you get them for that standard prescription charge and don’t have to pay any extra.

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