Montana State Auditor James Brown announced his office has helped stop more than $5 million in unsupported payouts by Mountain Health Co-Op, making it the second health insurer in Montana identified as a victim of a fraud scheme that targeted vulnerable Native communities using a loophole in the Affordable Care Act.
The latest announcement brings the total savings identified for the two affected insurers to more than $60 million. Brown’s office previously helped halt more than $40 million in payments by PacificSource, the first insurer identified in the investigation.
“My agency launched a second front in our fight against these fraudsters, who thought they could get rich quick by abusing and defrauding Montana’s native population,” Brown said. “We will continue to claw back wrongful claims and show fraudsters that they won’t get away with their manipulative, deceitful crimes in the Treasure State.”
The scheme exploited an Affordable Care Act provision that allows tribal members to enroll in ACA plans year-round without a waiting period. According to investigators, fraudsters — referred to in the investigation as “body brokers” — targeted homeless shelters on or near reservations, recruiting vulnerable individuals with promises of free luxury rehabilitation treatment, transportation, housing and cash incentives. Some victims were provided alcohol or drugs during transport or at the time of medical evaluation to keep them compliant, according to the investigation.
Once enrolled, victims were transported across state lines to out-of-state treatment facilities, where insurers were billed for treatments that never occurred, were inadequate, unnecessary or charged at inflated costs. Victims were then housed in substandard conditions, shuffled between facilities and abandoned far from their homes without resources to return — circumstances the auditor’s office said may have contributed to the problem of missing and murdered Indigenous persons.
The investigation found the scheme operated in a four-step pattern: convincing tribal members to disenroll from Medicaid; enrolling them in ACA plans using false information; transporting them across state lines; and billing Montana insurers for the fraudulent treatments.
Brown urged Montanans to watch for warning signs, including unsolicited offers of treatment or recovery services, pressure to switch insurance coverage, promises of free transportation to out-of-state facilities and unfamiliar individuals with large vans visiting communities.