BILL NUMBER:S1444

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:

2014 - S.3284

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.