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Office of the New York State Comptroller
News From the Office of the New York State Comptroller

State Medicaid System Wastes Millions

Out-of-State Hospitals Cash in on New York’s Medicaid Program

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For Release: Immediately, May 3, 2010

DiNapoli: State Medicaid System Wastes Millions

Out-of-State Hospitals Cash in on New York’s Medicaid Program

Audio Available

New York State made excessive and unnecessary Medicaid payments of at least $150 million because of pervasive problems with its billing system and policies, according to a series of audits released today by State Comptroller Thomas P. DiNapoli. In fact, out-of-state hospitals were overpaid about $21.4 million for medical procedures because the state was using outdated reimbursement information. The findings of the audits were referred to the Office of the Medicaid Inspector General.

“Too often, New York’s Medicaid system treats tax dollars like Monopoly money,” DiNapoli said. “There is too much easy come, easy go allowed in the program. The cost of this program continues to rise because no one is paying attention to the problems with the automated billing system. It is outrageous that out-of-state hospitals can cash in on New York’s Medicaid recipients because New York is relying on outdated information. There is no Free Parking jackpot to bail this program out. The waste and abuse in this program is costing taxpayers too much money.”

In two audits, DiNapoli found the state Department of Health (DOH) overpaid out-of-state providers about $21.4 million for non-emergency services going as far back as 2002. The errors occurred because DOH relied on outdated reimbursement formulas or because it did not apply the correct reimbursement rates. Auditors also found that costly non-emergency procedures were taking place in out-of-state hospitals without prior approval as required.

Contact

Albany Press Office:
P (518) 474-4015
F (518) 473-8940

NYC Press Office:
P (212) 681-4840
F (212) 681-4468

press@osc.state.ny.us

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