South Portland personal care agency accused of defrauding MaineCare in long-running scheme

PORTLAND, Maine (WMTW) - The U.S. Attorney’s Office for the District of Maine announced Tuesday that an indictment has led to the arrests of six people in connection with an alleged long-running healthcare fraud scheme.

Federal prosecutors said a home healthcare agency in South Portland stands accused of defrauding MaineCare, the state’s Medicaid program, out of hundreds of thousands of dollars for services that were never provided.

The U.S. Attorney’s Office and federal law enforcement partners, including the FBI and the IRS, held a news conference Tuesday to discuss the indictment.

Trump administration’s allegations of fraud in Maine

On Jan. 23, the U.S. Department of Health and Human Services announced that an audit revealed Maine made at least $45.6 million in improper fee-for-service Medicaid payments for rehabilitative and community support (RCS) services provided to children diagnosed with autism.

Two weeks later, Centers for Medicare and Medicaid Services (CMS) Administrator Dr. Mehmet Oz said in a social media post that Maine needed to “clean up its act” when it came to Medicaid fraud. CMS also sent a letter to the Maine Department of Health and Human Services, in which it asked Gov. Janet Mills to explain how MaineCare — the state’s Medicaid program — prevents fraud, identifies when fraud happens, bans providers from billing the system and recovers misspent funds. Mills responded to that letter by saying Maine was facing “a political attack” from President Donald Trump.

During his State of the Union address on Feb. 24, Trump accused Maine of fraud and announced a “war on fraud” that would be led by Vance. In a statement responding to Trump’s claim, a spokesperson for Mills said Maine would “not be intimidated by the president’s threats” and said addressing fraud allegations should be a joint effort between the state and federal government.

On March 6, Mills announced that her administration had responded to the CMS request for information about MaineCare and said the state was conducting oversight to ensure MaineCare providers are held to high standards, adding that the state has robust enforcement mechanisms to identify fraud.

Vice President JD Vance visited Maine on May 14 and said the state may be the third- or fourth-worst state when it comes to fraud.

“Outside of Minnesota and California, which are probably No. 1 and No. 2, if they’re the gold medalist and silver medalist — I heard somebody shout out New York — maybe New York is the bronze medalist, but let me be honest, maybe Maine is the bronze medalist,” Vance said. “What you have in Maine is a festering problem where people have been taken advantage of and they’ve been stolen from, and your government hasn’t done anything about it.”

On Aug. 3, Oz was in Maine to further look into alleged fraud in the state. The following day at a news conference in Philadelphia, Oz said that billing by the top 10 providers in Maine has dramatically increased over the last six years. He said the catalyst for the fraud issue was the COVID-19 pandemic. In a statement responding to Oz’s claims, the Maine Department of Health and Human Services said that it has been actively working with CMS in response to the Office of the Inspector General report that was released in January.