Stephanie InnesArizona Republic
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The state is denying responsibility for the death of a 52-year-old Navajo woman whose family says she lost her life because of a massive Medicaid fraud scandal that Arizona officials failed to prevent and negligently prolonged.
Tammy Notah died as a result of an infection July 22, 2023, according to the lawsuit, which was filed in Maricopa County Superior Court. It names Arizona's Medicaid agency, the Arizona Department of Health Services and various providers as defendants.
On May 16, 2023, Arizona Gov. Katie Hobbs, along with tribal leaders and representatives of multiple state agencies, announced sweeping Medicaid fraud that is estimated to have fleeced taxpayers of up to $2.5 billionover a period of approximately four years between 2019 and 2023.
During the news conference when the fraud was announced, Arizona Attorney General Kris Mayes characterized what had occurred as a "stunning failure of government."
Officials said the fraud was also a human tragedy that targeted a small coverage option within the Medicaid agency called the American Indian Health Program, or AIHP. Fraudsters disproportionately preyed on Indigenous people seeking help in recovering from drug and alcohol dependence, investigators said.
Notah's husband, Dennis Keith, and her three sons say she got the infection while trying to get sober from alcohol dependence, but she was mistreated by bogus providers who were registered with Arizona's Medicaid program. That program is called the Arizona Health Care Cost Containment System, known as AHCCCS (pronounced access).
Notah was enrolled in the American Indian Health Program, which is managed within AHCCCS, the lawsuit says.
The lawsuit blames Notah's death on the state's lack of oversight and failure to stop the Medicaid fraud earlier.
State officials recently filed a response to the lawsuit that denies culpability. When allegations about fraudulent billing and patient safety came to the attention of "appropriate state agencies," they were "reviewed and/or investigated, and appropriate action was taken based on the information obtained," the state response said.
Notah's family said she developed an open wound under her left big toe while using the shower in a "filthy" and "crowded" sober living home in Litchfield Park, according to the lawsuit. The wound got infected and later turned into sepsis, which took Notah's life, the lawsuit said.
The sober living home was affiliated with outpatient treatment providers in the Phoenix area who the lawsuit said overbilled AHCCCS for "treatment" that consisted of video-conferenced Zoom classes that were "nothing more than a billing opportunity."
AHCCCS does not reimburse sober living homes, but sober living homes were critical to the fraudulent billing. Investigators have said the schemes typically worked by sober living homes forming liaisons with outpatient behavioral health providers who were registered with AHCCCS, got reimbursed by AHCCCS, and who were licensed by the Arizona Department of Health Services.
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Sober living home employees recruited and sometimes lured Indigenous people into the facilities with promises of free housing, food and other incentives, prosecutors have said. The lawsuit said the sober living home where Notah, her husband and son were staying was affiliated with providers who incentivized patients by paying them $100 per week if they signed in for "treatment" every day.
The lawsuit said state health officials awarded licenses to drug and alcohol rehab providers without requiring them to prove that they were covered by liability insurance, "which was a loophole that allowed treatment centers to pop up overnight."
The lawsuit accused AHCCCS of poor oversight and said the state, via a memo dropped off at the Arizona Attorney General's Office by a private citizen Feb. 7, 2022, knew about the fraud schemes and how they were working.
In its response, attorneys for the state said the various entities alleged to have preyed on Notah as described in the lawsuit "were comparatively at fault, thus reducing or eliminating damages, if any, owed by defendants (the state)."
Lawyers for the state are requesting the lawsuit be dismissed.
The civil case filed by Notah's family is the fourth wrongful death lawsuit filed against Arizona over the Medicaid fraud crisis. All have been filed by lawyers from the Phoenix-based BrewerWood Law Firm. The other cases focus on the deaths of three Indigenous men from 32 to 44 years old. One was from the Crow Tribe of Montana and two were from the Navajo Nation, which extends into the states of Utah, Arizona and New Mexico.
The state faces other legal action over the fraud.
A group of Arizona behavioral health providers and clients said they've put the state on notice of an intent to file multiple lawsuits related to the fraud. Leaders of the effort said on June 14 that they had filed 60 notices of claim — precursors to lawsuits — with the Arizona Attorney General's Office.
The notices of claim collectively add up to $2.3 billion, group organizer André Miller told The Arizona Republic in June.
The Arizona Republic on June 5 published a story about evidence that AHCCCS officials failed to take action on warning signs of the fraud dating back to 2021.
Reach health care reporter Stephanie Innes atstephanie.innes@gannett.comor at 480-313-3775. Follow her on X, formerly known as Twitter,@stephanieinnes.
