Medicaid fraud settlement becomes part of Virginia gubernatorial campaign

Virginia Attorney General Ken Cuccinelli says he is taking on the IRS over a Medicaid fraud settlement payment from which the state is owed $125 million. But Democrats in the state's congressional delegation say they had been working on the issue for months and accused him of using his office for a campaign stunt in the gubernatorial race.

The Washington Post: Cuccinelli Takes On IRS Over Payment to Virginia
Cuccinelli is in a bitter fight with McAuliffe, a Democrat, to succeed Gov. Robert F. McDonnell (R). The attorney general called a morning news conference to announce that the IRS was refusing to release $125 million, part of the assets forfeited in a Medicaid fraud investigation that his office led. The case produced a $1.6 billion plea agreement with Abbott Laboratories for illegally promoting unapproved uses of its drug Depakote. It was the second-largest Medicaid fraud settlement in U.S. history (Vozzella, 6/5).

The Associated Press/Washington Post: After Va. Attorney General Complains Of Delay, Feds Cite Requirements For Releasing $115M
Hours after Virginia Attorney General Kenneth Cuccinelli complained that the Internal Revenue Service was blocking the release of more than $100 million owed to Virginia from a Medicaid settlement, federal officials said Wednesday that they are prepared to cut a $10 million check but need additional information before transferring the rest (6/5).