Senate Seeks Medicaid Fraud Crackdown

Albany, N.Y.--

State Senator George H. Winner, Jr. (R-C, Elmira) today joined his Senate colleagues to continue to push for a comprehensive Medicaid fraud detection effort that they believe would save state taxpayers at least hundreds of millions -- and potentially billions -- of dollars and greatly improve the accountability, integrity and quality of New York’s $44-billion Medicaid program.

"This year’s Medicaid reform actions have been significant so far, but we can’t stop here. Our work on Medicaid reform is far from finished," said Winner. "The Senate is pursuing the creation of an independent office to focus on fraud, waste and abuse in the Medicaid system. We believe it has the potential to save taxpayers hundreds of million of dollars."

Winner said that Senate secured $1 million in the 2005-06 state budget to create a Medicaid Inspector General, a new, independent office to consolidate, restructure and streamline the state’s efforts to detect, investigate and prosecute Medicaid fraud. These efforts are currently divided between the state health department and attorney general.

State Assembly leaders have so far rejected the idea of a Medicaid Inspector General. The Senate will continue to make legislation establishing the new office a priority and pursue ongoing negotiations with the Assembly on it. Winner co-sponsors the Senate legislation. The cornerstone of the Senate’s proposal is the creation of a state-of-the-art computer fraud detection system.

The federal General Accounting Office (GAO) estimates that fraud accounts for at least 10 percent -- and possibly as much as 30 percent -- of Medicaid expenses in states across the nation. Fighting fraud is considered so important that the federal government contributes 75 percent of the cost of fraud-fighting units in each state, while states fund the balance.

Nonetheless, according to recent federal reports, New York ranks alone among the nation’s 10 most populous states in spending more on anti-fraud efforts than it recovers. From 2001 to 2003, New York’s Medicaid Fraud Control Unit, which prosecutes fraud and recovers illicit gains, posted 72 cents in recoveries for every dollar spent by state and local governments on fraud recovery, according to a review of filings with the federal Department of Health and Human Services. By contrast, the state of Texas recouped five times its anti-fraud spending. New Jersey regained six times its investment.