§ 145-b. False statements; actions for treble damages. 1. (a) It shall
be unlawful for any person, firm or corporation knowingly by means of a
false statement or representation, or by deliberate concealment of any
material fact, or other fraudulent scheme or device, on behalf of
himself or others, to attempt to obtain or to obtain payment from public
funds for services or supplies furnished or purportedly furnished
pursuant to this chapter.

(b) For purposes of this section, "statement or representation"
includes, but is not limited to: a claim for payment made to the state,
a political subdivision of the state, or an entity performing services
under contract to the state or a political subdivision of the state; an
acknowledgment, certification, claim, ratification or report of data
which serves as the basis for a claim or a rate of payment, financial
information whether in a cost report or otherwise, health care services
available or rendered, and the qualifications of a person that is or has
rendered health care services.

(c) For purposes of this section, a person, firm or corporation has
attempted to obtain or has obtained public funds when any portion of the
funds from which payment was attempted or obtained are public funds, or
any public funds are used to reimburse or make prospective payment to an
entity from which payment was attempted or obtained.

2. For any violation of subdivision one, the local social services
district or the state shall have a right to recover civil damages equal
to three times the amount by which any figure is falsely overstated or
in the case of non-monetary false statements or representations, three
times the amount of damages which the state, political subdivision of
the state, or entity performing services under contract to the state or
political subdivision of the state sustain as a result of the violation
or five thousand dollars, whichever is greater. Notwithstanding part C
of chapter fifty-eight of the laws of two thousand five: (a) For civil
damages collected by a local social services district, relating to the
medical assistance program, pursuant to a judgment under this
subdivision, such amounts shall be apportioned between the local social
services district and the state. If the violation occurred: (i) prior to
January first, two thousand six, the amount apportioned to the local
social services district shall be the local share percentage in effect
immediately prior to such date as certified by the division of budget,
or (ii) after January first, two thousand six, the amount apportioned to
the local social services district shall be based on a reimbursement
schedule, created by the office of Medicaid inspector general, in effect
at the time the violation occurred; provided that, if there is no
schedule in effect at the time the violation occurred, the schedule to
be used shall be the first schedule adopted pursuant to this
subdivision. Such schedule shall provide for reimbursement to a local
social services district in an amount between ten and fifteen percent of
the gross amount collected. Such schedule shall be set on a county by
county basis and shall be periodically reviewed and updated as
necessary; provided, however, that any such updated schedule shall not
be less than ten percent nor greater than fifteen percent of the gross
amount collected; and (b) For civil damages collected by the state
relating to the medical assistance program pursuant to a judgment under
this subdivision, the local social services district shall be entitled
to compensation up to fifteen percent of the gross amount collected for
such participation, including but not limited to identification,
investigation or development of a case, commensurate with its level of
effort or value added as determined by the Medicaid inspector general.

3. If any provider or supplier of services in the program of medical
assistance is required to refund or repay all or part of any payment
received by said provider or supplier under the provisions of this
chapter and title XIX of the federal social security act, said refund or
repayment shall bear interest from the date the payment was made to said
provider or supplier to the date of said refund or repayment. Interest
shall be at the maximum legal rate in effect on the date the payment was
made to said provider or supplier.

4. (a) The Medicaid inspector general, in consultation with the
department of health, may require the payment of a monetary penalty as
restitution to the medical assistance program by any person who fails to
comply with the standards of the medical assistance program or standards
of generally accepted medical practice in a substantial number of cases
or grossly and flagrantly violated such standards and:

(i) receives, or causes to be received by another person, payment from
the medical assistance program when such person knew, or had reason to
know, that:

(A) the payment involved the providing or ordering of care, services
or supplies that were medically improper, unnecessary or in excess of
the documented medical needs of the person to whom they were furnished;

(B) the care, services or supplies were not provided as claimed;

(C) the person who ordered, prescribed, or furnished the care,
services or supplies which were medically improper, unnecessary or in
excess of the documented medical need of the person to whom they were
furnished was suspended or excluded from the medical assistance program
at the time the care, services or supplies were furnished; or

(D) the services or supplies for which payment was received were not,
in fact, provided; or

(ii) such person fails to grant timely access to facilities and
records, upon reasonable notice, to the Medicaid inspector general, the
Medicaid fraud control unit of the attorney general's office, or the
department of health for the purpose of audits, investigations, reviews,
or other statutory functions. For purposes of this subparagraph,
"reasonable notice" means a written request made by a properly
identified agent of the Medicaid inspector general, the Medicaid fraud
control unit of the attorney general's office, or the department of
health either, during hours that the individual or entity is open for
business, or mailed to the individual or entity to an address on file
with the department of health or last known address. The request shall
include a statement of the authority for the request, the definition of
"reasonable notice", and the penalties for failure to comply;

(iii) such person knew or should have known that an overpayment has
been identified and does not report, return and explain the overpayment
in accordance with subdivision six of section three hundred
sixty-three-d of this article;

(iv) such person arranges or contracts, by employment, agreement, or
otherwise, with an individual or entity that the person knows or should
know is suspended or excluded from the medical assistance program at the
time such arrangement or contract regarding activities related to the
medical assistance program is made;

(v) such person had an obligation to identify, claim, and pay a bonus
under subdivision three of section three hundred sixty-seven-w of this
article and such person failed to identify, claim and pay such bonus.

(vi) For purposes of this paragraph, "person" as used in subparagraph
(i) of this paragraph does not include recipients of the medical
assistance program; and "person" as used in subparagraphs (ii), (iii)
and (iv) of this paragraph, is as defined in paragraph (e) of
subdivision six of section three hundred sixty-three-d of this article;
and "person" as used in subparagraph (v) of this paragraph includes
employers as defined in section three hundred sixty-seven-w of this
article.

(b) In determining the amount of any monetary penalty to be imposed,
the Medicaid inspector general, in consultation with the department of
health, shall take into consideration the following:

(i) the number and total value of the claims for payment from the
medical assistance program which were the underlying basis of the
determination to impose a monetary penalty;

(ii) the effect, if any, on the quality of medical care provided to
recipients of medical assistance as a result of the acts of the person;

(iii) the degree of culpability of the person in committing the
proscribed actions and any mitigating circumstances;

(iv) any prior violations committed by the person relating to the
medical assistance program, Medicare or other social services programs
which resulted in either a criminal or administrative sanction, penalty,
or recoupment; and

(v) any other facts relating to the nature and seriousness of the
violations including any exculpatory facts.

(c) (i) For subparagraphs (i), (iii), and (iv) of paragraph (a) of
this subdivision, in no event shall the monetary penalty imposed exceed
ten thousand dollars for each item or service which was the subject of
the determination herein, except that where a penalty under this section
has been imposed on a person within the previous five years, such
penalty shall not exceed thirty thousand dollars for each item or
service which was the subject of the determination herein.

(ii) For subparagraph (ii) of paragraph (a) of this subdivision, in no
event shall the monetary penalty exceed fifteen thousand dollars for
each day of the failure described in such subparagraph.

(iii) For subparagraph (v) of paragraph (a) of this subdivision, a
monetary penalty shall be imposed for conduct described in subparagraphs
(i), (ii) and (iii) of paragraph (a) of subdivision five of section
three hundred sixty-seven-w of this article and shall not exceed one
thousand dollars per failure to identify, claim and pay a bonus for each
employee.

(d) Amounts collected pursuant to this subdivision shall be
apportioned between the local social services district and the state in
accordance with the regulations of the department of health.

(e) For the purposes of this subdivision, "gross and flagrant
violation" shall mean conduct which has an adverse effect on the fiscal
integrity of the medical assistance program and:

(i) which substantially impairs the delivery of high quality medical
care, services, or supplies; or

(ii) which substantially impairs the oversight and administration of
the program.

(f) A person against whom a monetary penalty is imposed pursuant to
this subdivision shall be entitled to notice and an opportunity to be
heard, including the right to request a hearing pursuant to section
twenty-two of this chapter.

5. When in the course of conducting an investigation relating to the
investigation relating to the medical assistance program, a local social
services district deduces that a provider may have committed criminal
fraud, it shall refer the case to the office of Medicaid inspector
general along with appropriate supporting information. The office shall
promptly review the case and, if deemed appropriate, refer the case
pursuant to subdivision seven of section thirty-two of the public health
law. If the deputy attorney general for Medicaid fraud control accepts a
referral from the office of Medicaid inspector general that was
identified, investigated or developed by a local social services
district, and the state collects damages, the participating local social
services district shall be entitled to compensation up to fifteen
percent of the gross amount collected for such participation
commensurate with its level of effort or value added as determined by
the deputy attorney general for Medicaid fraud control. If the office of
Medicaid inspector general determines that it is not appropriate for
referral in accordance with subdivision seven of section thirty-two of
the public health law the office of Medicaid inspector general shall
further investigate the case, with notice to the participating local
social services district, or return the case to the participating social
services district, which may resume its investigation of the provider.