BILL NUMBER:S4614

TITLE OF BILL:
An act
to amend the social services law, in relation to the state reimbursement
of county payments for medical assistance fraud, waste and abuse
detection software

PURPOSE:
To provide fiscal relief to counties in combating Medical fraud, waste
and abuse through the use of data mining software.

SUMMARY OF PROVISIONS:
Amends the social services law by adding a new paragraph aa to section
368-a of the social services law to require the State to reimburse
counties if such county has previously purchased or intends to
purchase data mining software that detects inaccuracies in the
Medicaid system.
Further defines "data mining software" as a database application that
utilizes advanced data searching capabilities and statistical
analyses to discover patterns and correlations in the use and abuse of
medical assistance practices.

JUSTIFICATION:
New York State's Medicaid program is the largest and most costly in
the nation. Although New York has seven percent of the U.S.
              

population, Medicaid cost the State approximately $46.5 billion in
2007 - 33 percent more than California, which maintains the nation's
second largest Medicaid system. Between DOH and the State's Medicaid
Fraud Control Unit (MFCU), New York spends more than $130 million to
combat fraud. Further, statistics indicate that fraud equals about
ten percent of total Medicaid dollars spent each year in New York
State.

Medicaid costs are the largest part of county budgets and fraud, waste
and abuse (FWA) consume a good portion of these budgets. Providing
funding to counties to do their own FWA investigations would free up
resources at the State level for more complicated cases. Counties can
immediately determine where there may be a problem by drilling
through reimbursement data, thus giving them better control of their
Medicaid dollars and become more accountable to the taxpayer.

Additionally, smaller counties have cited numerous concerns over
paying for this software themselves, although many of them are
supportive of the concept. Counties such as Franklin,
Clinton and Essex already do not have enough staff assigned to the
task of investigating FWA, and therefore cannot pay for software and
hire additional staff to utilize this software for these
investigations. Furthermore, they have indicated that if the State is
dedicated to having the counties investigate and prosecute FWA then
they should also dedicate the funds to do so.

Combating fraud ,waste and abuse is the first step in fixing a broken
system. The Medicaid program itself was established with honest
intentions and it is our duty to preserve it so that those
individuals who need Medicaid services the most receive them, and


those who are utilizing Medicaid fraudulently are prosecuted
accordingly.

LEGISLATIVE HISTORY:
2009: A.2053
2008: A.5333

FISCAL IMPLICATIONS:
Undetermined at this time. However, any cost would conceivably be
accomplished through FWA investigation, prosecution and deterrence.

EFFECTIVE DATE:
This bill shall take effect immediately.