New York State Comptroller Thomas P. DiNapoli announced today the following audits and examinations have been issued:
Auditors identified vulnerabilities in DOH’s provider enrollment and revalidating procedures that undermine its ability to ensure that only qualified providers participate in the Medicaid program and prevent improper payments for services. As a result of these weaknesses, six eye care professionals who did not fully comply with the DOH’s Medicaid policies for provider enrollment and revalidation were able to obtain Medicaid eligibility under questionable circumstances.
Two managed care organizations reported medical costs for services procured through a corporate affiliate that would have been more accurately classified as administrative costs. These costs, which should have been subject to an administrative cap, were included in the medical costs component of the premium rate, which is not capped. Based on an analysis of the corresponding impact on the 2013-14 Managed Long Term Care premium rates, auditors estimated the misclassification of costs led to questionable payments of at least $82.3 million.
Department of Health: Ambulatory Patient Groups Payments for Duplicate Claims and Services in Excess of Medicaid Service Limits (Follow-Up) (2017-F-3)
An initial audit released in June 2015 determined DOH did not implement adequate controls to enforce Ambulatory Patient Groups (APG) policy and payment rules. As a result, Medicaid made $32.1 million in actual and potential overpayments. Additionally, DOH did not have controls in place to prevent duplicate claims, resulting in $7.5 million in overpayments. In a follow-up, auditors found DOH officials made some progress in addressing the problems identified in the initial audit report. About $800,000 of the identified overpayments were recovered and DOH updated policy manuals to give clearer billing guidance to providers.
Metropolitan Transportation Authority: New York City Transit Subway Wait Assessment (Follow-up) (2017-F-7)
A prior audit determined that wait assessment performance did not improve during the audit period and that New York City Transit had not developed a full and comprehensive plan to deal with the long-term causes of service disruptions, including matters related to major structural and technology improvements. In a follow-up, auditors found the MTA made some progress in addressing the problems identified in the prior report. However, additional actions are warranted.
State Education Department (SED): Brookville Center for Children’s Services Inc., Compliance with the Reimbursable Cost Manual (2016-S-75)
Brookville is a Nassau County-based not-for-profit organization providing preschool special education services to children with disabilities between the ages of three and five years. For the three fiscal years ended June 30, 2014, auditors identified $1,089,215 in reported costs that did not comply with requirements for reimbursement and recommended these costs be disallowed. The costs included: $305,207 in duplicative administrative costs; $240,673 in ineligible lease expenses; $273,100 in ineligible management fees; $234,291 in ineligible and/or insufficiently documented fringe benefit expenses; and $35,944 in over-allocated compensation, ineligible tuition reimbursements, and other insufficiently documented expenses.
State Education Department: Building Blocks Developmental Preschool Inc., Compliance With the Reimbursable Cost Manual (2017-S-1)
Building Blocks is a not-for-profit special education provider located in Commack. Building Blocks provides preschool special education services to children with disabilities who are between three and five years of age. For the three fiscal years ended June 30, 2015, auditors identified $56,966 in ineligible costs that Building Blocks reported for reimbursement. These ineligible costs included: $53,073 in non-reimbursable lease costs, $3,497 in non-reimbursable consultant costs, and $396 in non-reimbursable food costs.
State Education Department: Hawthorne Foundation Inc., Compliance With the Reimbursable Cost Manual (2017-S-3)
Hawthorne is a not-for-profit special education provider located in Westchester County. Hawthorne provides preschool special education services to children with disabilities who are between three and five years of age. For the fiscal year ended June 30, 2015, auditors identified $75,189 in ineligible costs that Hawthorne reported for reimbursement for the rate-based preschool special education program that it operated. The ineligible costs included: $56,619 in personal service costs for insufficiently documented staff time; and $18,570 in other than personal service costs. Auditors also determined Hawthorne did not disclose related-party transactions with three entities.
State Education Department: The Child Study Center of New York (CSC), Compliance With the Reimbursable Cost Manual (2017-S-13)
CSC, a not-for-profit organization located in Jericho, is authorized by SED to provide preschool special education services to children with disabilities who are between three and five years of age. For the fiscal year ended June 30, 2014, auditors identified $127,101 in ineligible costs CSC reported for reimbursement. The ineligible costs included $121,255 in employee fringe benefit costs that were incorrectly allocated and $5,846 in ineligible costs for food, personal travel, gifts, and other non-reimbursable expenses.
Department of Taxation and Finance: Controls Over the Collection of the Public Safety Communications Surcharge (2016-S-84)
The department has not established policies and systems to sufficiently ensure that wireless telecommunication service providers comply with the tax law and that the state receives all monies to which it is entitled. In particular, the department does not have adequate controls to ensure that all eligible providers supplying services in the state collect, report, and remit the surcharges for all eligible devices to the department.