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NEWS from the Office of the New York State Comptroller
Contact: Press Office 518-474-4015


State Comptroller DiNapoli Releases Audits

October 2, 2017

New York State Comptroller Thomas P. DiNapoli announced today the following audits and examinations have been issued:

Department of Health: Questionable Payments for Practitioner Services and Pharmacy Claims Pertaining to a Selected Physician (Follow-Up) (2017-F-2)

An initial audit issued in September 2015 found significant issues with medical records provided by a physician to support his Medicaid claims. There was insufficient assurance that the doctor provided appropriate medical care and that services totaling $1,039,404 warranted Medicaid payment. At the time of the follow up review, the Office of the Medicaid Inspector General (OMIG) was actively investigating the doctor. According to OMIG officials, steps will be taken to implement each of the four recommendations made in the initial audit pending the results of the investigation.

Department of Health (DOH): Medicaid Program: Administrative Costs Used in Premium Rate Setting of Mainstream Managed Care Organizations (MCOs) (2015-S-76)

Auditors found that one MCO reported about $9.8 million in administrative expenses that were not allowable. Several MCOs appear to have shifted costs from the non-allowable category of marketing to the allowable category of facilitated enrollment, contrary to the intent of a policy change that was initiated from the Governor's Medicaid Redesign Team proposal. As a result, DOH is not fully realizing the annual savings that should occur as a result of the policy change. For fiscal year 2014-15, auditors estimate DOH paid MCOs about $127 million for facilitated enrollment through the premium rates. However, despite the magnitude of these payments, DOH does not adjust each MCO's premium to reflect the MCO's actual facilitated enrollment activities.

Hudson River Park Trust: Selected Financial Management Practices (2016-F-22)

A prior audit found the trust needed to improve its practices related to revenue collection, procurement, investments, payroll, budgeting and equipment inventories. In a follow-up, auditors found that the trust made progress in correcting the problems identified in the initial report. However, additional actions are still needed.

Metropolitan Transportation Authority: New York City Transit - Train On-Time Performance (Follow-up) (2017-F-8)

A prior audit determined that for calendar years 2013 and 2014, actual on-time performance for subways was well below the goal of 91.9 percent. In a follow-up, auditors found that the MTA made limited progress in addressing the problems identified in the prior report. Of the two prior audit recommendations, neither were fully implemented. Moreover, since the conclusion of the last audit, on-time performance has continued to decline.

State Education Department (SED): Lois Bronz Children's Center Inc., Compliance with the Reimbursable Cost Manual (2016-S-86)

The center provides preschool special education services to children with disabilities who are between three and five years of age. For the two years ended June 30, 2014, auditors identified $177,786 in ineligible costs that the center reported to SED for reimbursement. Auditors also identified $132,713 in questionable costs that the center reported from a contract it could not prove was competitively bid.

Thruway Authority: Compliance With Payment Card Industry Standards (2017-S-11)

Auditors identified several matters that management should address to improve the authority's information security program for cardholder data and to help ensure it meets PCI requirements. The Thruway has not taken fundamental steps to secure its network and could also improve certain other technical safeguards over the cardholder data it processes.