Senate Bill S3284

                                BILL NUMBER:S3284

TITLE OF BILL:  An act to amend the social services law, in relation to
the state reimbursement of county payments for medical assistance fraud,
waste and abuse detection software

PURPOSE:  To provide fiscal relief to counties in combating Medical
fraud, waste and abuse through the use of data mining software.

SUMMARY OF PROVISIONS:  Amends the social services law by adding a new
paragraph aa to section 368-a of the social services law to require the
State to reimburse counties if such county has previously purchased or
intends to purchase data mining software that detects inaccuracies in
the Medicaid system. Further defines "data mining software" as a data-
base application that utilizes advanced data searching capabilities and
statistical analyses to discover patterns and correlations in the use
and abuse of medical assistance practices.

JUSTIFICATION:  New York State's Medicaid program is the largest and
most costly in the nation. Although New York has seven percent of the
U.S.  population, Medicaid cost the State approximately $46.5 billion in
2007 - 33 percent more than California, which maintains the nation's
second largest Medicaid system. Between DOH and the State's Medicaid
Fraud Control Unit (MFCU), New York spends more than $130 million to
combat fraud. Further, statistics indicate that fraud equals about ten
percent of total Medicaid dollars spent each year in New York State.
              

Medicaid costs are the largest part of county budgets and fraud, waste
and abuse (FWA) consume a good portion of these budgets. Providing fund-
ing to counties to do their own FWA investigations would free up
resources at the State level for more complicated cases. Counties can
immediately determine where there may be a problem by drilling through
reimbursement data, thus giving them better control of their Medicaid
dollars and become more accountable to the taxpayer.

Additionally, smaller counties have cited numerous concerns over paying
for this software themselves, although many of them are supportive of
the concept. Counties such as Franklin, Clinton and Essex already do not
have enough staff assigned to the task of investigating FWA, and there-
fore cannot pay for software and hire additional staff to utilize this
software for these investigations.  Furthermore, they have indicated
that if the State is dedicated to having the counties investigate and
prosecute FWA then they should also dedicate the funds to do so.

Combating fraud ,waste and abuse is the first step in fixing a broken
system. The Medicaid program itself was established with honest
intentions and it is our duty to preserve it so that those individuals
who need Medicaid services the most receive them, and those who are
utilizing Medicaid fraudulently are prosecuted accordingly.

LEGISLATIVE HISTORY:  2009: A.2053 2008: A.5333

FISCAL IMPLICATIONS:  Undetermined at this time. However, any cost would
conceivably be accomplished through FWA investigation, prosecution and
deterrence.

EFFECTIVE DATE:  This bill shall take effect immediately.