Medicaid as a government program provides health and medical care in the US for certain groups of interest and is under the department of human and health services of the US. It targets mainly people with low income by establishing its own standards, value for their services and terms of payment to its customers at affordable charges and due to these subsidized services it is funded by the government (Imperato, 2003). It is provided for persons who are eligible as provided by the three acts of false claims, federal deficit act of reduction and the plan of medical integrity. These services are given to people registered to various managed cares such as the HMOs AND PPOs among others.

The false claims act prohibits the use of government funds unlawfully and the US government highly fines for such acts (Cona, 2006). It involves the violation of medical contracts and ineligibility for the services of Medicaid. This normally focuses on subcontractors and other downstream providers who provide such government funds through contractors such as the HMOs directly linked to Medicaid (Carson, Verdy and Wokutch, 2008). It covers unlawful acts and fraudulence in falsified claims of being needy or suffering from a certain disease so as to receive such help. This act regulates fraud in Medicaid and other health providers such as TRICARE; it is used as a remedy for controlling aid in form of grants provided by the health department of US. This helps to ensure no overpayments and liabilities are left unpaid for, due to lack of transparency and impunity.

The federal deficit reduction act ensures flexibility so as to ensure transparency in Medicaid; it provides the legal citizens eligible for such services such as the disable and low and middle earning families (Cona, 2006). It also states prohibitions by the defined states and their rates of charging premiums thus regulate the amount of money charged for those services. It also states issues concerning cost sharing to ensure correct payments for any prescriptions made preventing fraud (Welch, 2006). It also defines standards of benefits and also the cases that are targeted by the Medicaid management.

The medical integrity plan on the other hand acts as a public auditor fighting against waste and abuse of funds and services provided by Medicaid thus promoting the fight against deception. Service providers for managed care such as the HMOs are audited and claims for poor services, overpayments and other complains are taken gravely. Scrutiny on medical archives, lack of documentation and bill payments errors are of the concerns of this plan (Carson, Verdu and Wokutch, 2008). This helps to prevent falsifying of costs, administering of generic drugs that are less effective compared to the original ones, avoids kickbacks where one offers something valuable in return for managed care services or similar consultations while it is your right which you are entitled (Imperato, 2003). These have been effective in reducing unnecessary cost and prevent overcharging thus controlling cost of services by Medicaid.

The government has tried to provide medical services to the poor and the special people such as the disabled but faces the challenge of discerning those who legally deserve the service due to increased fraud. The challenge of the aging generation that requires more medical attention is overwhelming the financial burden of Medicaid since they are not working. A challenge of caring for beneficiaries of Medicaid with mental and behavioral disorders is a challenge since they are not eligible though they are on the rise in the US (Welch. 2006). These are problems that are being looked at and will be mitigated by the US government with the urgency they deserve.


Carson, T., Verdu, M. and Wokutch, R. (2008). Whistle-Blowing for Profit: An Ethical Analysis of the Federal False Claims Act. Journal of Business Ethics. (77) 3: pp.361-376

Cona, J. (2006). Beware of the Deficit Reduction Act: Nursing Homes 55 (10); p. 46-48.

Imperato, G., (2003). Consultant Relationships May Pose Liability Risk: Healthcare Financial Management 57 (1); p. 72-75.

Welch, J.  (2006). Mission Impossible: Stopping Medicaid Fraud. Journal of Health Care Compliance. 8 (5); pp. 57-58.


Written by