U.S. Attorney Sues New York City for Medicaid Fraud

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U.S. Attorney Sues New York City for Medicaid Fraud

Posted on 27 January 2011. Tags: home care, Medicaid, New York, nursing homes, personal care services

The U.S. Attorney for the Southern District of New York filed a lawsuit (pdf) against New York City on January 11, claiming that the city’s Medicaid program had improperly authorized 24-hour, community-based personal care services for frail elders and people with disabilities when these consumers would be better served in a nursing home.

The suit alleges that the city disregarded the rules requiring that doctors, nurses, and social workers make recommendations regarding enrolling consumers in home care.

It also contends that the city had reauthorized 24-hour personal care services without conducting the required assessments and that in some cases the consumers were receiving too much care.

Suit Implies Financial Gain

The U.S. Attorney’s office claims that New York City had overbilled Medicaid by “at least tens of millions of dollars” and implies that the city did so for financial gain. Beginning in 2006, only the state and federal government shared the cost of Medicaid Personal Care Services (pdf), but the city has been responsible for a share of nursing home care costs, according to The New York Times.

“We don’t think that the suit is well-founded,” New York City Mayor Michael Bloomberg told the New York Daily News. “We never received one cent from the process. But it will certainly require a lot of expense on the city’s part for our lawyers to go through lots of documentation.”

“We’re proud that our elderly residents, wherever possible, are not forced into nursing homes,” Bloomberg added.

Chilling Effect on Home Care

On January 12, dozens of disability rights advocates, consumer advocacy organizations, legal representatives, and consumers sent a letter (pdf) to Preet Bharara, the U.S. Attorney who brought the suit against the city, asking that it be withdrawn immediately.

The letter states that New York City has done an excellent job of complying with the Supreme Court’s Olmstead decision, which requires states to provide care in community settings rather than institutions when possible.

The advocates also take issue with the complaint that the consumers cited in the suit would have received “more intensive,” “more appropriate,” or “safer” care in a nursing home compared with home care, calling such claims a “myth.”

They write that “we are concerned that the lawsuit is already having a chilling effect and will discourage the authorization of adequate Medicaid home care for people who desperately need it to live in their homes.”

Applauded, Not Punished

“New York City’s personal care program is a success story — it should be applauded, not punished, for enabling so many people with disabilities, old and young, to remain in the community rather than enter nursing homes,” Valerie Bogart, director of the Evelyn Frank Legal Resources Program at Selfhelp Community Services, told PHI. Bogart helped organize the advocates’ response to the suit.

The advocates also question the allegation that the city gains financially by authorizing more personal care services than needed, because “the City’s share of Medicaid costs is the same for all long-term care services, whether at home or in nursing homes.”

“The physician who brought the so-called whistleblower case may personally believe that these individuals belong in nursing homes, but his views should not be endorsed by the federal government — they completely fly in the face of the Americans with Disabilities Act and Olmstead,” Bogart said.

“The federal prosecutors should be going after real Medicaid fraud, not punishing New York City for providing 24-hour home care for people who desperately need it,” she continued.

Independence Care System, a PHI affiliate that operates a nonprofit, Medicaid-managed long-term care plan in New York City, signed onto the letter.

– by Deane Beebe