Fraud, Waste & Abuse

Federal and state law requires PHP to implement and maintain a compliance program that includes measures to identify, limit and address fraud, waste and abuse. This is important to you because every time you spend money on healthcare or pay your taxes, fraud, waste and abuse directly increase your costs. According to the Legal Information Institute at Cornell University Law School ". . . statistics now show that 10 cents of every dollar spent on health care goes toward paying for fraudulent health care claims."1 To do our part to prevent fraud, waste and abuse, PHP wants to help our members:

  1. Recognize the many ways fraud, waste and abuse can occur: What is it?
  2. Understand the impact of fraud, waste and abuse: Why should we care?
  3. Take steps to prevent fraud, waste, and abuse; How can we help?
  4. Know what to do when you suspect fraud, waste and abuse. What can we do?

I. A DEFINITION: FRAUD, WASTE & ABUSE BY MEMBERS ("Recipient Fraud"): What is it?

  • Fraud: A false statement made by a member who knows that the statement is false in order to receive an unauthorized benefit (a benefit for which that member is NOT eligible.).
  • Waste: The overuse of services by a member that is inconsistent with good medical practices and that causes unnecessary cost to the AHCCCS program.
  • Abuse:  Similar to fraud, and resulting in excess expense or loss to the healthcare system, but without an intentionally false statement.

Some very common examples:

Transportation benefit waste and abuse: Using the transportation benefit to go shopping at the mall and telling PHP that you are using it for a doctor's appointment.

Prescription benefit fraud, and abuse:  Going to several doctors for the purpose of getting prescriptions in order to overuse the drugs or to sell them to others.

  • Fraud -- Providing incorrect or false information to a DES worker in order to be eligible for benefits. An example of this would be indicating that your income is lower than it actually is.
  • Fraud -- Providing false information about or failing to provide information about other health insurance coverage you have to a DES worker.
  • Fraud -- Failing to advise AHCCCS about a new residence when you move out of the state or country.

NOTE:  Providers can also commit fraud, waste, and abuse (Provider fraud). To see common examples of provider fraud, waste, and abuse CLICK HERE.


In 2011 the Medicaid program served 70 million members nationwide at a cost of $428 billion. The sheer size of Medicaid combined with Medicare makes it almost impossible to accurately identify the cost of potential fraud, waste and abuse.

However, according to an April 2012 study, cited experts who estimate as much as $98 billion of Medicare and Medicaid spending in 2011 was the result of fraud and abuse alone (not including waste).2 That is a very large portion of the overall cost!

How can we help?

The best thing you can do to prevent fraud, waste, and abuse is to be an active participant in your healthcare and to guard your benefits carefully. Here are some tips:

    • DO NOT give your Medicaid card number to anyone except your doctor, clinic, hospital or other health care provider.
    • DO NOT let anyone borrow your Medicaid card. Treat your card the way you treat your credit card.
    • DO NOT share your Medicaid records or other medical information with anyone except your doctor, clinic, hospital or other health care provider.
    • DO NOT do business with door-to-door or telephone sales people who tell you that services or medical equipment are free.
    • DO NOT accept free tests or screenings in exchange for your Medicaid card number, be suspicious. Be careful about accepting Medicaid services when you are told they will be free of charge.
    • DO NOT provide your information to anyone who claims they know how to make Medicaid pay for healthcare services or goods that Medicaid usually does not pay for. Avoid conversations with these individuals.
    • DO NOT ask your doctor or other health care provider for medical care that you do not need.
    • DO NOT sign your name to a blank form. Ask for a copy of everything you sign. Keep the copy for your records.


If you identify or are made aware of potential fraud, waste or abuse by either another member or a provider, it is not only your right, but also your responsibility to report it. You may make a report by calling the PHP Compliance Hotline at 1-800-8ETHICS (1-800-838-4427). You may also call:

1-888-487-6686 or 602-417-4045

Reporting line for Arizona Health Care Cost Containment System (AHCCCS) - Arizona's Medicaid Program

1-800-HHS-TIPS (1-800-447-8477)

OIG (Office of the Inspector General) National Fraud Hotline.  The hotline will handle calls about Medicaid (and Medicare), but may be less direct than calling the State contact.


Information that will be useful  (but not required) to the investigators includes: Medicaid client's name and card number, the doctor, hospital, or other health care provider involved, date of service, the amount that Medicaid paid (or approved).

When you call the reporting line, you are encouraged to provide contact information so that you can be contacted for more information, if it is needed. However, you may make your report anonymously. This means that you do not need to leave your name or number so no one who receives the message will know who called. In either case, you cannot lose your eligibility, benefits or any services by making a report.

Because fraud, waste and abuse impact everyone,
prevention and detection of fraud, waste and abuse
is everyone's job!

Other Helpful Links:

Note: By clicking on the below links, you will be leaving the Phoenix Health Plan website and be redirected to a third party website.

For information on fraud, waste, and abuse from Arizona's Medicaid program, please visit the Arizona Health Care Cost Containment System web site at


1 Healthcare Fraud: An Overview, Cornell University Law School,, downloaded 12-10-12

2 Health Policy Brief, Eliminating Fraud and Abuse, July 31, 2012,, downloaded 12-10-12