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New York Medicaid Fraud Control Unit: 2017 Onsite Inspection


OIG administers the Medicaid Fraud Control Unit (MFCU or Unit) grant awards, annually recertifies the Units, and oversees the Units' performance in accordance with the requirements of the grant. As part of this oversight, OIG conducts periodic reviews of all Units and prepares public reports based on these reviews.


We conducted the onsite inspection of the New York MFCU in August 2017. Our review covered the 3-year period of FYs 2014-2016. We based our inspection on an analysis of data from eight sources: (1) Unit documentation; (2) financial documentation; (3) structured interviews with key stakeholders; (4) structured interviews with the Unit's managers and selected staff; (5) a survey of Unit staff; (6) a review of a purposive sample of 20 case files that were open at some point during the review period; (7) a review of all convictions submitted to OIG for program exclusion and all adverse actions submitted to the National Practitioner Data Bank during the review period; and (8) observations of Unit operations.


The New York MFCU reported substantial statistical outcomes for fiscal years (FYs) 2014-2016, including 370 indictments; 348 convictions; 211 civil judgments and settlements; and total recoveries of over $670 million. From the data we reviewed, we found that the Unit generally operated in accordance with applicable laws, regulations, policy transmittals, and the MFCU performance standards. However, we made five findings involving the Unit's adherence to program requirements: (1) Unit practices left some case files vulnerable to unauthorized access; (2) the Unit did not have a written policy for conducting periodic supervisory reviews and noting the reviews in the Unit's case files; (3) the Unit did not report all convictions and adverse actions to Federal partners within the appropriate timeframes; (4) the Unit generally exercised proper fiscal controls, but it did not exercise proper fiscal controls over the sale and transfer of certain Unit vehicles; and (5) three Unit professional staff temporarily performed non-Unit duties, and the Unit did not deducted the associated costs from claimed Unit expenditures. We also made observations regarding Unit operations and practices, including beneficial practices that may be useful as a model to other Units.


We recommend that, to address the five findings, the New York MFCU: (1) take steps to ensure that MFCU staff adhere to policies and procedures for securing case files; (2) create policies and procedures for conducting periodic supervisory reviews of Unit case files, and take steps to ensure that case files include documentation of periodic supervisory reviews; (3) ensure that the Unit consistently reports convictions and adverse actions to Federal partners within the appropriate timeframes; 4) ensure that—consistent with Unit policy—the Unit reimburses the Federal Government its share of proceeds received from the sale and transfer of vehicles and any other equipment; and (5) strengthen internal controls to ensure that the Unit excludes from its claimed grant expenditures all costs related to time spent by staff on non-Unit activities. The Unit concurred with all five of our recommendations.