Oversight Leaders Seek Action on New York State Medicaid Waste, Efforts to Obstruct Committee’s Investigation

Published: Jun 19, 2013

WASHINGTON – Leaders on the House Oversight and Government Reform Committee continued oversight of the New York State Medicaid program this week by sending two letters on the lack of cooperation from the Medicaid inspector general and continued waste within the program.

The first letter, sent to Medicaid Inspector General James C. Cox, cites the IG’s refusal to produce requested documents and a threat from IG staff to an employee who spoke with Congress. An email from the office’s Director of Employee Relations to an employee who cooperated with the Committee says if the employee speaks about OMIG matters, they do so “at your own risk, and may subject yourself to administrative action, including potential discipline.”

“This warning—which included a threat of potential disciplinary action—is likely to have a chilling effect on the willingness of OMIG employees to cooperate with the Committee’s review of this matter,” the letter states. “For this reason, warnings such as this are prohibited by statute.  Any further actions by you or your staff that are meant to intimidate current or former OMIG employees will not be tolerated.”

The second letter urges the Center for Medicare and Medicaid Services to change the current practice for managed care plans. Managed care plans are paid approximately $3,800 per enrollee per month and are currently allowed to determine a person’s eligibility themselves. Adult daycare centers, which are covered by the plans, are inappropriately referring healthy individuals for coverage and using perks and free food to persuade seniors to sign up for the long-term plans.

“Given the rampant abuse of eligibility rules in New York,” the letter says, “we urge CMS to prohibit managed care companies in New York and across the country from conducting eligibility determinations for Medicaid immediately.  In addition, we urge CMS to disallow the State from receiving Federal reimbursement for all unlawful or inappropriate expenditures related to improper enrollment in long-term care managed care plans.”

Both letters were signed by Chairman Darrell Issa (R-Calif.), Subcommittee on Economic Growth Chairman Jim Jordan (R-Ohio), and Subcommittee on Energy Policy Chairman James Lankford (R-Okla.).

You can read the letter to Inspector General Cox here and the letter to CMS here.


  • In September 2012, the Committee released a staff report and held a hearing on the Administration’s failure to prevent an end Medicaid overpayments. At the hearing, CMS officials reversed course and promised immediate action to end federal overpayments.
  • In March 2013, the Committee released a bipartisan committee report on New York State’s Medicaid misspending. In 2010, New York spent $1,500 more per capita on Medicaid than the average in the rest of the country.  The Committee report contained six recommendations, including the recovery of an appropriate amount of past overpayments, for both the federal government and New York in order to minimize misspending in the State’s program going forward and remedy past abuses.
  • In April 2013, in response to pressure from the Committee, CMS sharply reduced Medicaid overpayments to New York State, resulting in an estimated $1.2 billion in taxpayer savings in the first 18 months with additional savings thereafter.