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Legislation sponsored by Assemblyman Gordon Johnson (D-Bergen) to further protect taxpayers by increasing penalties for Medicaid fraud has been signed into law.

The new law (S-2141/A-3015) will help combat attempts to cheat the program of state and federal funds that are intended to serve the health care needs of the medically indigent by increasing penalties for committing Medicaid fraud.

“At a time when we need to make sure that we stretch every public dollar as far as it will go, this law is crucial,” Johnson said. “It sends a clear message that we will not tolerate the abuse of taxpayer dollars, especially those that provide critical healthcare to some of our most vulnerable and needy residents. Those that attempt to defraud the program, especially if they are a medical professional, will not only face hefty fines and possible imprisonment, but risk jeopardizing their very career.”

The law will ensure that the decision not to impose a jail sentence in a Medicaid fraud case – as well as other fraud involving public agencies or public funds – is given especially careful consideration by the sentencing court, since the matter involves fraud against the public.

The law:

-Upgrades certain offenses involving Medicaid fraud from a “high misdemeanor” to a crime of the third degree punishable by a fine or imprisonment for three to five years, or both, or a crime of the fourth degree punishable by a fine or by imprisonment for not more than 18 months, or both;

-Creates new mandatory monetary penalties for Medicaid fraud offenses of not less than $15,000 and not more than $25,000 for a crime of the third degree, and not less than $10,000 and not more than $25,000 for a crime of the fourth degree, in addition to any other penalty that may be imposed by law;

-Eliminates the presumption that a person who has not been previously convicted of an offense, will automatically avoid prison for an offense involving Medicaid fraud that is defined as a crime of the third degree under this law; and

-Creates a new crime of the second degree, with a monetary penalty of not less than $25,000 and not more than $150,000, for persons convicted of repeated Medicaid fraud offenses under certain circumstances, specifically, where the aggregate amount obtained or sought to be obtained is $1,000 or more, and the person has previously been convicted of such a violation within 10 years of the current violation, under circumstances where the aggregate amount obtained or sought to be obtained was also $1,000 or more.

The law also directs the Attorney General to turn the matter over to the appropriate professional or occupational licensing board within the Division of Consumer Affairs, when applicable, in order to determine if appropriate action should be taken regarding a person’s license or other authorization to practice as a health care professional.

Johnson noted that nothing in this bill is to be construed to preclude the indictment or conviction for any other offense defined by law, or to impair or limit the discretion and authority of the state regarding any civil action, criminal prosecution, or other action authorized by law.

The bill unanimously passed both houses of the Legislature on June 28 and was signed into law by the Governor on June 30. The provisions go into effect immediately.

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