GOP senator launches effort to close Medicaid loophole allowing fraudsters to rake in millions

Sen. Ashley Moody, R-Fla., is introducing new legislation aimed at closing a legal loophole protecting the beneficiaries of Medicaid fraud from prosecution, Fox News Digital has learned.

Moody's STOP FRAUD in Medicaid Act is routed in her experience as Florida's attorney general, where she was limited to prosecuting Medicaid fraud only on the provider side. The legislation would grant state attorneys general and their Medicaid Fraud Control Units to investigate and prosecute the recipients of fraudulent benefits as well.

"The STOP FRAUD in Medicaid Act gives State AGs the authority to pursue and prosecute not just providers but recipients looking to bilk taxpayers. This will go a long way to winning our War on Fraud," the statement continued.

Moody's office says federal prosecutors can go after fraud recipients under anti-kickback laws, but said federal groups often let the "small fish" skate by. Empowering MFCUs would go a long way toward picking up the slack, they say.

In one case, investigators said an autism center operator fraudulently billed millions while using tactics that included offering payments or benefits tied to enrollment, illustrating how kickbacks helped drive inflated claims and contributed to large-scale misuse of public funds intended for children with autism.

Fox News' Andrew Mark Miller contributed to this report.