CCA ( CoreCivic ) and Medicaid Fraud

[Ed. Note: The following post was written for Prison Path. It is reprinted here. This post was also edited in 2017 to reflect the new name of Corrections Corporation of America, CoreCivic and again in 2020 to reflect new allegations of wrongdoing against the company.]

The private prison industry takes in over $5 billion per year in revenue. Companies like CoreCivic and the GEO Group (formerly Wackenhut Corrections) employ thousands of people across the United States. Other vendors provide specific services to government correctional facilities such as food preparation and inmate healthcare.

The Justice Department says that as of 2013, there were 133,000 county, state and federal prisoners housed in private prisons. Hundreds of thousands more rely on private healthcare vendors.

Because private prisons and medical services vendors need to earn a profit, there is constant friction between returning a healthy profit for investors and providing adequate care to the inmate population. That friction is often most visible when dealing with inmate healthcare needs.

As America’s population ages and healthcare grows more costly each year, the question becomes who should bear the cost of care. Depending on the service and the contract, that responsibility may belong to the government or the vendors. One thing is certain, however. Inmate healthcare isn’t reimbursable by Medicaid.

If a private prison vendor falsely certifies that it is providing adequate healthcare or if the vendor improperly bills Medicaid, there may be a violation of the False Claims Act. That law allows whistleblowers to collect an award for reporting fraud involving government dollars. Many states have a similar statute for fraud involving state funds.

There haven’t been many cases filed yet but the violations are common.

As an example, a prison healthcare vendor that bills a state corrections department for 1000 hours of physician time but only provides 500 hours of nurse practitioner time is guilty of fraud. If the state has a False Claims Act, the employee, guard or even inmate reporting the violation may be eligible for an award of up to 30% of whatever the government collects. With triple damages and penalties of up to $11,000 per each false invoice submitted, awards can add up quickly.

Another example is the private prison operator who takes an inmate outside the facility for specialized treatment and then attempts to coerce the provider to bill Medicaid.

Several years ago industry giant CoreCivic’s predecessor Corrections Corporation of America or “CCA” was investigated by the Florida Attorney General’s Medicaid Fraud Control Unit. The investigation found that “CCA routinely directed or otherwise caused outside medical providers to bill Medicaid for [care] in violation of Florida and federal law.”

The Attorney General also found that CCA often required inmates or their families to provide medications for pre-existing illnesses. Family members often complied and used the inmate’s Medicaid benefits to pay for those prescriptions.

We suspect that the quality of the medical care delivered in many facilities is often substandard in terms of what the provider’s contract requires. Although there is sometimes a code of silence both within the inmate community and among guards, we know that similar substandard care issues abound in nursing homes. Why would prison healthcare be any better?

To qualify for a whistleblower award, one must have original source (inside) information about a vendor or company committing fraud. To qualify for an award, there must be a government program or funds involved. By there very nature, private prisons and healthcare relies on contract payments from the government.

To obtain an award, you must file a sealed lawsuit in court detailing the fraud and your source of knowledge. Complaints remain secret while being investigated by the government. There are also anti-retaliation provisions available to address employees who are fired or demoted because they stood up and reported fraud.

CoreCivic’s History of Labor Problems

In the last 20 years, CoreCivic (or its affiliates /predecessor entities) has paid a whopping $19,918,855.00 in fines and penalties in employment related actions. In 2017, the U.S. Department of Labor found that the company “has discriminated against 22 qualified Black male applicants and 141 qualified female applicants not hired into Correctional Officer positions because of their race and sex, respectively.”

The company was ordered to find the 163 people not hired and provide them with back pay. The company paid a penalty of over $300,000.

Call for CoreCivic Whistleblowers

The Medicaid fraud incident discussed above is now over a decade old. Unfortunately we believe that CoreCivic is still cutting corners both with its employees and how it cares for sick inmates. When a private prison company fails to properly train its officers or staff a facility, everyone’s life is in danger. Many of the guards working in these facilities are making just over minimum wage while the CEO makes millions of dollars. It’s not only dangerous, it’s unfair. If you have inside information about improper staffing, bribes to state officials or serious billing problems, call us.

Worried that the awards are not real? Last year the U.S. Department of Justice paid out over $265 million of awards. In the last decade, over a billion dollars in rewards. How do we know? Our whistleblower clients received over $100 million of that money.

About the author. Brian Mahany is a whistleblower lawyer and author. He operates a nationwide whistleblower and Medicare fraud practice based in Milwaukee. Earlier in his career, he served as a state certified corrections officer with the Somerset County (Maine) Sheriff’s Department. Brian welcomes questions, comments and referrals. All inquiries are protected by the attorney client privilege. Contact him online, by email at (202) 800-9791 or by email at . Cases handled nationwide.

We also urge you to visit our Private Prisons and Private Prison Healthcare Whistleblower Information page.

[If you or a loved one suffered a life threatening injury because of poor prison medical care or died while in custody under suspicious circumstances, visit or sister jail death and police misconduct site.]