Senator Serrano Announces Medicaid Inspector General Office To Increase Enforcement, Penalties For Health Care Fraud

State Senator José M. Serrano (D- Bronx/Manhattan) today announced the creation of an independent Office of the Medicaid Inspector General (OMIG), with broad new powers to hunt down and prosecute fraud and abuse in New York’s $45 billion-a-year Medical Assistance program for the frail, elderly and poor.

"New York spends more on its Medicaid program than any other state in the nation, and there are those who prey on the program’s inability to combat fraud and abuse," Senator Serrano said. "This is a major step in stopping those criminals who exploit the most vulnerable New Yorkers, wringing billions of dollars in overpayments out of a health care system spiraling out of control."

The legislation, passed on Wednesday, dramatically restructures New York State’s process of preventing, detecting, investigating, and recovering improper Medicaid payments. The bill also calls for new fraud-detecting technology and tougher criminal penalties for Medicaid fraud. The state’s Medicaid fraud-fighters, currently split between six state agencies, will be consolidated into one unit at the state health department.

The Medicaid Inspector General, appointed by the Governor, will work in close cooperation with the Attorney General’s office, referring appropriate cases for criminal prosecution. When fully in place, the OMIG will have more than 600 full-time staff devoted to fighting Medicaid fraud and abuse, making it one of the largest Medicaid fraud-fighting units in the nation.

"With the creation of this new unit, we now have a single place where accountability resides," Senator Serrano said. "New Yorkers need to know their hard-earned tax dollars actually deliver health care services to those who need it the most. This bill helps make New York’s Medicaid program more efficient and manageable."

OMIG will coordinate anti-fraud activities of State agencies whose clients are served by Medicaid, including the Department of Health, the Office of Mental Health, the Office of Alcohol and Substance Abuse Services, and others. The office will enhance the integrity of the Medicaid program, achieve substantial savings for taxpayers, and preserve quality health care for needy New Yorkers.

"I’m pleased that through a three-way agreement between the Senate, the Assembly, and the Governor, this measure was brought to the floor for a vote," says Senator Serrano. "This bill was being negotiated throughout this session. I expect it will to be signed into law."

The New York City lawmaker added: "This is a good first a step in the right direction, but we can do better. New York needs to enact a strong Martin Act for Medicaid, which would enhance our ability to investigate and prosecute wrongdoers. What’s more, the bill fails to contain a State False Claims Act, which would recruit whistle-blowers and help us learn about ongoing cases of fraud that might otherwise never be revealed."

"To combat Medicaid abuse, we need the strongest fraud-fighting reforms possible." Senator Serrano concluded. "Rest assured I will continue to send an unequivocal message to those criminals who would attempt Medicaid fraud in our state: Do so, and you will be exposed