Senator Kemp Hannon
6th District New York
Tougher Medicaid Fraud Effort Needed To Stop Abuse & Save Tax Dollars

 District Attorneys, County Executives, County Comptroller, Medicaid Fraud
 Technology Specialists Join Senate Republicans at Albany Medicaid Fraud
                         Task Force Public Forum

            The Senate Republican Task Force on Medicaid Fraud conducted a
public forum today in Albany to investigate what savings can be gained from
New York’s overburdened Medicaid system.  The Taskforce will explore ways
in which the State Legislature can assist counties to improve Medicaid
fraud prevention efforts.

            Chaired by Senator Kemp Hannon (R-C-I, Garden City), the
Taskforce will develop recommendations for improving the State’s Medicaid

            Among those providing expert testimony today were Nassau County
District Attorney Kathleen Rice, New York State Association of Counties
President Thomas J. Santulli, District Attorney’s Association of New York
President Kathleen Hogan, Rensselaer County Executive Kathleen Jimino,
Albany County Comptroller Mike Conners and Medicaid fraud technology

            “There is no excuse for tolerating any fraud in a program that
is the fastest-growing and largest single component of state and county
budgets,” said Senate Republican Leader Dean Skelos. “Medicaid fraud drives
up state spending and taxes as well as local property taxes.  We must fight
fraud aggressively, restore accountability and integrity to the Medicaid
program, and ensure that tax dollars are spent wisely to help the people
who really need help, not enrich criminals who prey on the system.”

            Along with Senator Hannon, the task force includes Senators
George Winner (R-C-I, Elmira), Charles Fuschillo (R, Merrick), Michael
Nozzolio (R-C, Fayette), Mike Ranzenhofer (R-C-I, Amherst), Hugh Farley
(R-C, Schenectady), Martin Golden (R-C, Brooklyn) and Vincent Leibell
(R-C-I, Patterson).

            “Medicaid costs New York State taxpayers a billion dollars per
week,” said Senator Hannon.  “This means it is costing taxpayers over
fifty-two billion dollars per year.”

           Chemung County Executive Thomas J. Santulli, President of the
New York State Association of Counties, said, "We need to have all levels
of government working together so that scarce public funds are used as they
are intended to be. Our counties know what works in the program and what
doesn't, and there may be areas of fraud and abuse.  Recently, New York
City and forty-two New York Counties obtained a victory in federal court
against 13 pharmaceutical manufacturers for fraudulent pricing through the
Medicaid Program.  These types of actions continue to demonstrate the
relevance and importance of county governments ensuring the integrity of
the Medicaid Program in New York."

            “In the future, our desired objective must include the
implementation of a cost-effective and efficient method of delivering
Medicaid services to our seniors and those citizens who are most in need,
while also trying to lessen the burden on the taxpayer,” added Senator

            The widespread problem of Medicaid fraud has been highlighted
by several reports issued by the State Comptroller’s office that documented
millions of dollars in Medicaid overpayments and billing errors, as well as
tens of thousands of people that were improperly enrolled in Medicaid in
New York City.

            Despite the fact that they are on the front lines of the
Medicaid program, county officials are saying the state hinders their
efforts to stop fraud at the local level.  In fact, the 2009-10 State
Budget approved by the Governor and Democratic Legislators eliminated the
eligibility requirements for county-conducted face-to-face interviews,
finger-imaging and asset tests for Medicaid applicants, conducted by
counties.  The interviews are intended to ensure accountability in the
system, but will no longer be required as of April 2010.

          "This Task Force will dig deep to find solutions to protect state
taxpayers from a system that remains vulnerable to fraud and abuse," said
Warren County District Attorney Kathleen Hogan, who is also the President
of the New York State Association of District Attorneys.  "Through its
efforts, the members of the Task Force will combine extensive knowledge and
experience in the continuing battle to combat Medicaid fraud."

            The Executive Budget proposes spending a total of $52.5 billion
on Medicaid, meaning as much as $5 billion could be fraud in the system.

            In 2006, the Governor signed into law legislation sponsored by
Senators Skelos and Hannon, which:

     ·         Created a new, independent, Office of Medicaid Inspector
     General by consolidating responsibilities and staff from six agencies
     into the new Office and empowering the Medicaid Inspector General
     with the ability to detect, investigate and recover improper Medicaid
     ·         Provided county governments with new incentives and access
     to information to become active partners in the fight against
     Medicaid fraud;
     ·         Enhanced the capacity of the Department of Health and
     Office of Medicaid Inspector General to fight fraud with new,
     state-of-the-art technology;
     ·         Established new protocols and procedures to ensure the
     effective sharing of information and evidence regarding Medicaid
     fraud between the Office of Medicaid Inspector General, the Attorney
     General’s Medicaid Fraud Control Unit, county governments and
     district attorneys;
     ·         Required health care institutions to implement corporate
     compliance programs and allowing providers to request advisory
     opinions to ensure proper billing practices, and
     ·         Created new Health Care Fraud offenses to aid in the
     criminal prosecution of Medicaid fraud.

            “We want to make sure that the 2006 law is having as much of an
impact as possible,” Senator Skelos said.  “This issue becomes even more
urgent when you consider reports that the federal government is
investigating whether the people who are supposed to be watching out for
Medicaid fraud are actually committing fraud themselves.”

            In December, the New York State Comptroller released the
results of an audit that identified as much as $92 million in Medicaid
overpayments, billing errors and other problems.  He called on the State
Department of Health to increase scrutiny of Medicaid payments and recover
payments that were improperly made.  The Department agreed there were
overpayments, but said it would only try to recover $2.4 million in

            In addition, a 2008 report in the New York Post cited an audit
by the Comptroller’s Office, determining that nearly 30,000 people in New
York City alone were improperly enrolled in the State’s Medicaid system
between November 2006 and November 2007.  While the audit shows that almost
13,000 former New York City residents should have been investigated for
violations of the State’s Medicaid laws, only 207 cases were investigated.

            In his Executive Budget, Governor Paterson increased the
State’s target for Medicaid fraud recovery by $300 million, to a total of
$1.1 billion.

District Office
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Garden City, NY 11530
Albany Office
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Albany, NY 12247