Improper Medicaid Billing Costs New Yorkers Millions: Audit

Email a Friend

The state health department has wasted millions of dollars in taxpayer money, because it hasn't been keeping close enough tabs on Medicaid spending, according to State Comptroller Tom DiNapoli.

An audit released Wednesday (PDF) said the department’s Medicaid division unnecessarily paid for the healthcare of 45,000 people who were also covered by Medicare, leading Albany to shoulder $36 million worth of payments the federal government should've picked up.

“When you are in both programs, Medicare is supposed to be the primary payer,” DiNapoli told WNYC. “So, if you’re not properly coded in the system, the state ends up more than it should.”

The federal government and individual states share Medicaid expenses, but only the feds pay for Medicare. A small but often very sick and costly group of people are on both programs. They’re sometimes called Medi-Medi’s or dual eligibles. Washington and state health agencies across the country often haggle over this group's expenses – though not in the cases DiNapoli targeted.

DiNapoli’s audit blamed the state’s billing problems on a health department program called eMedNY, which is responsible for processing claims associated with the state’s $53 billion in Medicaid expenditures. A Virginia-based, publicly traded multinational called Computer Sciences Corporation runs the eMedNY program for New York on a 12-year, $930 million contract that expires this June. CSC spends about $100,000 a year lobbying state legislators.

The fate of eMedNY is uncertain, as the state increasingly looks to outside managed care companies — sometimes called Medicaid HMO's — to improve healthcare coordination and contain costs for the five million New Yorkers on Medicaid.

DiNapoli said the $36 million discrepancy — plus another $6 million his office also alleged in a separate audit (PDF) — is a small fraction of the multi-billion dollar program, which was unlikely to ever be "100-percent efficient," but he said, "Every few months we do an audit, we find tens of millions of dollars [wasted], sometimes even more  — a million here, a million there, it adds up to real money."

The health department, which spends millions of dollars a year fighting "fraud, waste and abuse" by medical providers, challenged some of the findings in the published audit, but did not immediately return calls seeking comment.

In the audit, health officials said the eMedNY system is in the process of being updated — and the problems will be corrected.