Why not deduct what they owe?

A recent GAO study found that we paid 7,000 Medicaid providers in Florida, New York, and Texas $6.6 billion in 2009.  However, these same 7,000 providers owe $791,000,000 in unpaid federal taxes from calendar year 2009 or earlier.  This amount of unpaid taxes is likely understated as it does not include providers that did not file a tax return or filed one with some income not listed.  Further, some of these firms have criminal records relating to medical billing fraud.

Does the government do any checking of those to whom it issues Medicaid checks?