What to Know
- New Jersey officials offered a pilot amnesty program for people to admit improperly receiving Medicaid benefits
- The program followed the arrest of 26 people in Lakewood last summer for welfare fraud
- Religious leaders are backing the program, which will let participants avoid prosecution
A piliot amnesty program for people to confess abuse of Medicaid benefits, launched after more than two dozen fraud arrests in the booming New Jersey community of Lakewood, has led to another 159 settlements.
The Office of the State Comptroller's Medicaid Fraud Division released its bi-annual report Tuesday, which included the outcome of the Ocean County Recipient Voluntary Disclosure Program. The OSC said the 159 settlements, assuming all of them are completed as intended, will lead to $2.2 million in recoveries.
Under the terms of the program, people settling have to repay benefits they received while ineligible, plus a civil penalty. They also have to agree not to accept Medicaid for one year. But if they meet all the program requirements, the comptroller's office said it would not refer them for prosecution.
In late June and early July 2017, state and federal authorities charged 26 people from the Ocean County town of Lakewood, including a prominent local rabbi and a special-needs school leader, with a laundry list of fraud counts.
At the heart of the charges was the allegation that they all, in one way or another, failed to report or otherwise concealed significant income that would have made them ineligible for the assistance programs in which they enrolled. In total, state and federal prosecutors have said the families collected more than $2.4 million in benefits.
The charges shook Lakewood, whose population tripled since 1980 as the Orthodox Jewish population there surged. The town is now one of New Jersey's largest as a result.
The Asbury Park Press reported last year that hundreds of Lakewood residents contacted town officials after the arrests, seeking amnesty or guidance on whether they had broken the law.
The Lakewood Vaad -- a council of Orthodox religious leaders and businessmen -- supported the amnesty program, the paper said.
From the start, the program was controversial, particularly among people who felt it unfairly benefitted just one group of people. A forum designed to promote the program last year backfired, with dozens of people coming out instead to harangue officials over what they saw as unequal treatment for those eligible for amnesty.