Program not open to those who previously entered into a settlement with the state

Also not open to subjects of a pending state or county criminal matter

A public meeting on the program to take place Sept. 12 at Pine Belt Arena

TRENTON - The wave of arrests in Lakewood in alleged welfare fraud schemes has prompted state officials to establish an amnesty program that will let Medicaid cheaters avoid prosecution if they come forward.

But participants will be required to repay Medicaid for the benefits they received while ineligible, and pay an additional civil penalty based on the amount of improperly received benefits. Participants also must voluntarily withdraw from Medicaid for a one-year period.

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The “Ocean County Recipient Voluntary Disclosure Program” was announced Thursday by the Office of the State Comptroller and Medicaid Fraud Division. The Ocean County Prosecutor’s Office has affirmed it will not take action against amnesty program participants who comply with settlement terms, officials said.

State Comptroller Phillip James Degnan in a telephone interview said it's "impossible to predict'' how many will participate, but acknowledged that there's been high interest "from those who wish to come forward, but have concern about legal ramifications.''

The program, which begins Sept. 12 and runs three months, is open only to Ocean County residents.

"We're prepared for anything,'' Degnan said of the expected enrollment. He called this a "pilot program'' that will be considered for a future statewide rollout.

Federal and state law enforcement agents raided seven Lakewood houses in late June and arrested 14 people on allegations of nearly $2 million in public assistance fraud. Four face federal charges and the remaining 10 face state charges. Another 12 people were charged the following week in state court.

A spokesman for Ocean County Prosecutor Joseph D. Coronato, Al Della Fave, said there is "nothing to report at this time'' about the disposition of those cases.

Watch the video at the top of the page to see the arrests of residents on public-assistance fraud. The story continues beneath the photo gallery.

The roundup prompted hundreds of people to call town leaders to ask how to get off public assistance or if they were on the wrong side of the law.

Also, about 1,000 people seeking guidance attended a panel session on public assistance at the Fountain Ballroom at Lakewood Cheder in July.

Lakewood has more children living in married households receiving welfare than any other town in New Jersey. Newark has many more children in households that receive public assistance, but not in houses with married parents.

Of the 43,600 children under 18 years of age in Lakewood, 18,200 with married parents receive government assistance. Newark, the largest city in the state, is second with 7,800 children with married parents receiving aid, according to the Census Bureau's 2015 American Community Survey. Newark has a total of 70,669 children, and 37,965 children in households receiving public assistance, the data show.

Degnan said the goal of the program "is to bring those in Ocean County who were not in compliance with Medicaid eligibility requirements into compliance and to have them make full restitution of all improperly received funds.”

"Residents of Ocean County should consider this program to be their best opportunity to come into compliance without fear of criminal prosecution,” he said.

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The program is not open to those who previously entered into a settlement with the state, or who are subjects of a pending state or county criminal matter, officials said.

The Office of the State Comptroller will host a public meeting on the voluntary program on Sept. 12 at 6:30 p.m. Pine Belt Arena on the grounds of Toms River North High School, 1245 Old Freehold Road, Toms River.

The program application form and instructions, along with a sample settlement agreement, will be posted on the office's website, www.state.nj.us/comptroller. Applications must be sent in no later than Dec. 12.

Officials said suspected Medicaid waste, fraud or abuse can be reported by calling 888-937-2835 or by submitting a complaint form at www.state.nj.us/comptroller/divisions/medicaid/complaint.html.

Bob Jordan bjordan@gannettnj.com