Comptroller: State Overpaid for Medicaid

A series of audits conducted by the state comptroller’s office has revealed at least $150 million worth of waste, fraud and abuse in the state’s Medicaid reimbursement system due to what Comptroller Thomas P. DiNapoli called “pervasive problems with its billing system and policies.”

For example, the government auditors found that the state Department of Health overpaid out-of-state health care providers about $21.4 million for non-emergency services due to reliance on outdated reimbursement formulas; it was also discovered that costly non-emergency procedures were being performed in out-of-state hospitals without getting the required approvals. For example, $102,021 was paid to an Ohio hospital for a lymphoma treatment when a New York hospital would have only received $21,563 and $13,286 was paid to a Rhode Island hospital for a cesarean section when a New York hospital would have gotten $3,188.

Auditors also found that the state Medicaid system overpaid dentists by some $40 million. The audit focused on Medicaid payments for routine dental services during a five-year period and discovered several rather questionable reimbursement claims, including one dentist who billed 18 cleanings for one patient over five years and another who supposedly received 32 cleanings from 19 separate providers in a three year period. This overpayment, said the comptroller, could have been avoided if the state had changed its software to stop or suspend such payments and aligning reimbursement to a level comparable to other states.