17-1704

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HAWAII ADMINISTRATIVE RULES
TITLE 17
DEPARTMENT OF HUMAN SERVICES
SUBTITLE 12 	MED-QUEST DIVISION
CHAPTER 1704
FRAUD PROVISIONS
Subchapter 1 	General Provisions
§17-1704-1 	Purpose
§17-1704-2 	Definitions
Subchapter 2 	Recipient Fraud
§17-1704-3 	Investigation of suspected fraud
§17-1704-4 	Penalty
Subchapter 3 	Provider Fraud
§17-1704-5 	Preliminary investigation
§17-1704-6 	Resolution of investigation
Historical Note: 	This chapter is based substantially
upon chapter 17-1350 [Eff 6/29/92; R 08/01/94 	]
SUBCHAPTER 1
GENERAL PROVISIONS
§17-1704-1 	Purpose. 	The purpose of this chapter
is to define conditions under which the department will
investigate suspected fraud in medical assistance
cases. 	[Eff 08/01/94 	] (Auth: 	HRS §346-14)
(Imp: 	HRS §346-14)

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§17-1704-2 	REPEALED. 	[R 09/30/13]
SUBCHAPTER 2
RECIPIENT FRAUD
§17-1704-3 	Investigation of suspected fraud. 	(a)
The department shall identify situations in which there
are questions of suspected fraud such as, but not
limited to, a recipient receiving medical assistance to
which the individual is not entitled through willful
misrepresentation of circumstances or the intentional
concealment of information from the department.
(b) 	The DHS investigations office shall
investigate suspected fraud and refer these cases to
law enforcement officials.
(c) 	The methods of investigation shall not
infringe on the legal rights of the persons involved
and shall afford these individuals due process of law.
[Eff 08/01/94 	] (Auth: 	HRS §346-14; 42 C.F.R.
§431.10) (Imp: 42 C.F.R. §§455.13, 455.14, 455.15,
455.16)
§17-1704-4 	Penalty. 	The department may initiate
referral for prosecution of an individual suspected of
fraud. 	In addition, the individual may be subject to
any other criminal, civil, or administrative sanction
authorized by law. 	[Eff 08/01/94 	] 	(Auth: 	HRS
§346.14; 42 C.F.R. §431.10) Imp: 42 C.F.R. §§455.15,
455.16)
SUBCHAPTER 3
PROVIDER FRAUD
§17-1704-5 	Preliminary investigation. 	(a) 	DHS
shall conduct a preliminary investigation of all
medicaid fraud complaints from whatever sources
received to determine whether there is sufficient basis
to warrant a full investigation.
(b) 	If the findings of the preliminary
investigation indicate there is potential for criminal

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prosecution of fraud, the cases shall be referred to
the medicaid fraud control unit. 	[Eff 08/01/94 	]
(Auth: 	HRS §346-14; 42 C.F.R. §§431.10, 455.14) 	(Imp:
42 C.F.R. §§455.13, 455.14)
§17-1704-6 	Resolution of investigation. 	A full
investigation shall continue until:
(1) 	Appropriate criminal or civil legal action is
initiated;
(2) 	The matter is resolved between the department
and the provider through any one or
appropriate combination of the following
actions:
(A) 	A monitoring program of provider's
medicaid practice is established to
ensure corrective measures have been
introduced;
(B) 	A demand letter is sent to the provider
requiring repayment of overpayments to
the provider made by the medical
assistance program and warning the
provider that payment on that provider's
pending claims may be withheld in part
or in whole to be applied to
overpayments previously made to the
provider by the medical assistance
program;
(C) 	All claims of a provider are placed on
review prior to payment;
(D) 	In the event that the department is
unable to determine whether the actions
of a provider constitute improper
medical practice, the department
requests an
opinion of the Hawaii Medical
Association peer review committee; and
(E) 	The provider is suspended or terminated
from participation in the medical
assistance program as described in
sections 17-1736-17 and 17-1736-18.
[Eff 08/01/94 	] 	(Auth: 	HRS §346-
14; 42 C.F.R. §431.10) 	(Imp: 	42 C.F.R.
§§455.13, 455.14, 455.15, 455.16)