The Trump administration is suing New York and a contractor that runs a big Medicaid-funded home care program for the state, alleging the company is improperly keeping part of the care payments as part of a fraud scheme.
Public Partnerships LLC started work last year as overseer of $11 billion a year in payments to those caring for more than 200,000 people with disabilities and other home-bound New Yorkers. The new federal case alleges the company was supposed to be paid a fixed rate for its services but has padded its profits by raising caregiver bills and keeping “millions” as its share.
“New York’s failure to police a favored vendor that unlawfully siphoned millions of dollars of Medicaid funding is egregious and betrays the public trust,” Brett Shumate, an assistant U.S. attorney general for the Justice Department’s Civil Division, said in a statement announcing the case on Tuesday, June 16.
The case also alleges the Georgia-based company was chosen through a “sham bid process” and took too long to start managing the Consumer Directed Personal Assistance Program, or CDPAP. Public Partnerships LLC was hired to replace hundreds of agents that had served as “fiscal intermediaries” to get payments to caregivers.
What New York health officials say about DOJ Medicaid fraud accusations
Gov. Kathy Hochul’s administration fired back after the case was filed in the Brooklyn-based Eastern District of New York, dismissing it as a politically motivated action with no legal basis. A Department of Health spokeswoman called it “the latest attempt by Washington Republicans to score political points at the expense of vulnerable New Yorkers.”
“We look forward to the day where these disingenuous attacks can stop and our partners in Washington can look to New York as a model for how to improve to control costs and root out abuses while preserving and improving quality of care,” spokeswoman Cadence Acquaviva said.
Public Partnerships disputes the lawsuit’s claims, saying in a statement that it was chosen through a “transparent, competitive process” and has delivered “greater accountability, consistency, and support for the hundreds of thousands of New Yorkers who rely on” the care program.
“We are proud of what we have achieved with the State of New York and stand by our performance,” a company spokesperson said.
Flap over shift in oversight of CDPAP payments
Hochul had pushed to consolidate the program’s fiscal oversight under a single company, arguing it would save the state money and help it prevent wasteful or fraudulent billing. She has since touted the first results of the transition, saying the state saved $1 billion in the first year since Public Partnerships took over.
But the replacement of hundreds of local companies that managed the payments was controversial — opponents hammered Hochul in TV ads — and the choice of Public Partnerships set off criticism that it had gotten favored treatment. Some of the companies waged and lost a federal court case to stop the transition.
Republicans have been vocal critics, castigating the Democratic governor for the management change and the steep increase in CDPAP spending as enrollment has surged. The Medicaid funding that supports the program comes partly from the federal government and partly from the state’s own funds.
Sen. Rob Ortt, leader of the state Senate’s Republican minority, cheered the federal government’s lawsuit against New York as a welcome probe of the program.
“From the outset, our members have sounded the alarm about implementation problems and the lack of transparency surrounding this massive overhaul, and we welcome a thorough review of the process,” Ortt said in a statement.
Rep. Mike Lawler, a Rockland County Republican who has made past charges of bid rigging, called the lawsuit “a damning indictment of the cronyism and incompetence” of the Hochul administration in a statement. He demanded to know why the state passed over companies other than Public Partnerships.
The Department of Health spokeswoman argues the state has already been vindicated on that issue, saying the courts concluded it held a “fair and legally sound competitive bidding process.”
“The fact of the matter is this administration saved CDPAP from a fiscal crisis by removing hundreds of wasteful administrative middlemen,” spokeswoman Cadence Acquaviva said. “In the process, we reduced costs for state and federal taxpayers while protecting home care for those who need it.”
Chris McKenna covers government and politics for The Journal News and USA TODAY Network. Reach him at CMcKenna@usatodayco.com.
This article originally appeared on Rochester Democrat and Chronicle: Trump’s DOJ sues NY, Medicaid contractor over alleged home care fraud
Reporting by Chris McKenna, New York State Team / Rochester Democrat and Chronicle
USA TODAY Network via Reuters Connect
By Chris McKenna, New York State Team | USA TODAY Network
