June 6, 2006

New York still weak on Medicaid fraud

I noted a few articles last year on New York State's apparent lack of interest in policing Medicaid fraud, as well as some response by the governor to beef up enforcement.

Apparently the problems are quite real, and the response inadequate, according to a federal audit of the state's management (registration required) in today's New York Times:

The report, released yesterday by the federal Centers for Medicare and Medicaid Services in the Department of Health and Human Services, said that proposals Gov. George E. Pataki made this year, while commendable, failed to make up for the sharp reduction over many years in the number of state workers charged with policing Medicaid abuse.

Among other findings, the report focused heavily on the cut in those numbers — a 40 percent drop in staff since 1998, even though spending on the program has increased by 55 percent to roughly $45 billion a year. "As the largest single Medicaid program in the nation, New York's antifraud efforts over the last several years have not been proportionate to its vulnerability," the report said....

In 1998, according to the report, there were 950 workers responsible for "program integrity," or safeguarding the program from fraud and abuse, compared with just 584 in 2004. The federal investigators also questioned the state's growing reliance on outside contractors, in addition to state employees, to do such audits; more than one-quarter of the 584 people are contract workers. "The loss of experienced state program integrity staff is reflected in reduced institutional knowledge and expertise," the report said. At Mr. Pataki's urging, the state budget that was adopted this year added 81 staff positions to monitor Medicaid fraud. While the report praised that move, it noted that even those additions would leave the state far behind its position in Mr. Pataki's first term....

As proof of how poorly the Health Department had been doing, the report pointed out that total audit recoveries by the department had declined, along with the average amount collected in each audit. In the 2004-5 state fiscal year, just 260 of 140,000 providers were excluded from Medicaid.

To the Health Department's credit, the report said, it recently introduced a powerful new computerized warehouse of Medicaid claims that could be used for "data mining" — that is, looking for patterns that might indicate abuses of the system. But health officials have barely made use of that new tool, the report said.

The department has only 17 people working in data mining, according to the report....

The Department of Health refers the most serious cases to the attorney general's office for possible legal action — about 50 a year in recent years, which is far fewer than other states with much smaller Medicaid programs, the Times series said. The report highlighted the low numbers as well, and said the investigative team "questions why the state was not able to generate significantly more referrals than that."

There's vastly more in the article, but overall, it doesn't look good. The efforts the state's made so far to address the problems seem both small and strangely directed, with little interest in actually punishing anyone for committing fraud. A few pieces are caught up in the usual battles between the governor and legislature, but there's a lot that could be done which just isn't getting done.

Posted by simon at June 6, 2006 8:20 AM in
Note on photos