Senator Valesky Says Time For Medicaid Fraud Solution Is Now

David J. Valesky

June 21, 2006

Last year, as part of the first on-time budget in 20 years, we passed a cap on the local component of Medicaid. This was an important first step in efforts both to control spending on the nation's most expensive Medicaid program and to help counties reign in out-of-control property taxes.

With this important step behind us, it was my hope that this year the Legislature would reign in fraud and misuse of Medicaid dollars. New York currently spends about $45 billion for Medicaid a year on some 4.2 million recipients. Alarmingly, a recent report estimates that some $4 billion of that may be fraud. Other estimates are even higher.

Clearly the time has come to do something significant to curtail Medicaid fraud, and along with it, reduce Medicaid’s burden on local property taxes.

In the past two weeks, separate Medicaid fraud bills have been moving through the legislature -- one version through the Senate and one through the Assembly. These bills take slightly different tacks at the fraud problem, but both recognize the need to crack down on fraud. And while the Senate bill was far from perfect, I strongly supported it because it is another step in the right direction.

I am pleased to report the Senate’s Medicaid fraud bill passed 59-1, and the Assembly’s version passed 128-7.

Certainly, the Senate bill could have been more comprehensive. One addition I wanted to add to the Senate legislation was an expansion of the pilot project allowing counties to develop local Medicaid fraud prevention programs. In the latest budget, Chemung County was authorized to experiment with administrative techniques, new reimbursement methods and management methods to reduce the cost of Medicaid.

The amendment I introduced would allow every county to engage in a fraud prevention program. It directed the Department of Health to evaluate potential savings and provide logistical support to counties searching for innovative ways to deal with Medicaid fraud. By encouraging local programs the state could leverage local innovation as we work to reduce spending and reign in property taxes.

While this amendment was not part of the final bill, the Senate legislation we passed drastically increased the effort to reign in fraud. For that reason, it had my full support.
Now, it is my hope that the Senate and Assembly bills will move to a joint Legislative
Conference Committee to iron out differences and develop compromise legislation.

While there are several aspects of fraud prevention I would like to see incorporated in the final legislation, the important things is that we do something. The people of New
York are sick and tired of partisan gridlock and one house bills, and rightly so on this and other issues.

Medicaid fraud is a huge problem in New York State. We must improve the checks and balances within the program to ensure that our hard earned tax dollars are used for the intended purpose. At times like this legislators must put Albany-based partisanship aside and reach bipartisan solutions for the people we represent.