Senate Bill S8949

                                 
BILL NUMBER: S8949

SPONSOR: HARCKHAM
 
TITLE OF BILL:

An act to amend the public health law, in relation to the audit and
review of medical assistance program funds by the Medicaid inspector
general

 
PURPOSE:

To prevent certain auditing practices by the Office of Medicaid Inspec-
tor General (OMIG), particularly in instances where OMIG's practices
conflict with current agency guidelines.

 
SUMMARY OF PROVISIONS:

Section one amends the public health law by adding a new section 37
concerning audit and review of medical assistance program funds. This
section focuses on the determination of an overpayment of funds by the
inspector, occurred due to a provider submission of supporting records
in a form, format, or method of transmission that is not in accordance
              

with program requirement in effect at the time of the claim, but due to
changes in state agency policy or guidance is in accordance with
requirements in effect at the time of the inspector's review. In the
absence of fraud, recoupment for claim disallowances shall be limited to
the reimbursement amount of the claims without extrapolation, and the
inspector shall not initiate new or additional reviews against the
provider on the same basis.

Section two provides the effective date.

 
JUSTIFICATION:

When the Office of Medicaid Inspector General (OMIG) was created in
2007, the emphasis of the legislature and the concern of the public was
fraud and waste in the Medicaid system. However, recent audits have made
it clear the current statute lacks key provisions to assure fairness in
OMIG's practices.

One recent example involves a provider in the state currently facing an
OMIG audit that has calculated overpayments close to $4 million.  OMIG
is penalizing this provider for two issues: the first, faxing electron-
ically signed prescriptions rather than sending them through a specific
electronic system, and the second, not receiving a patient signature for
all products delivered, even though they did retain alternative proof of
delivery documents. The Department of Health (DOH) has updated agency
guidelines to allow for both practices, yet, even now, OMIG wants full
recovery of these extrapolated claims because the claims pre-date DOH's
updated guidance.

The bill will prevent OMIG from using extrapolation in instances when
agency guidelines are updated to allow for certain practices. OMIG
audits that punish providers for technical errors -not fraud or abuse -
do not help anyone in the Medicaid system. OMIG's over-reaching approach
will ultimately lead to less accessible care. This bill will reign in
these excessive practices and bring equity to the Medicaid audit proc-
ess.

 
LEGISLATIVE HISTORY:

New Bill

 
FISCAL IMPLICATIONS:

To be determined.

 
EFFECTIVE DATE: :
This act shall take effect immediately and shall apply to audits
commenced on or after such effective date, audits pending as of such
date, and audits that the Medicaid inspector general has concluded but
which are under administrative review or other properly filed judicial
review or appeal.