BILL NUMBER: S4955A
SPONSOR: HARCKHAM
 
TITLE OF BILL:
An act to amend the public health law, in relation to the functions of
the Medicaid inspector general with respect to audit and review of
medical assistance program funds
 
PURPOSE OR GENERAL IDEA OF BILL:
To provide due process protections to health care providers in the
medical assistance program when under audit by the Office of the Medi-
caid Inspector General (OMIG).
 
SUMMARY OF PROVISIONS:
Section 1 amends Public Health Law § 30-a by adding new subdivisions,
which defines various terms including "overpayment", "applicable stand-
ards" and "clerical or minor error or omission" consistent with exiting
NYS regulations and federal Medicare standards.
§ 2 adds a new section to the Public Health Law, § 37 to include trans-
parency and due process protections for providers related to OMIG audits
and recoveries in the medical assistance program. This includes consid-
eration of the potential impacts of an audit on the provider's financial
solvency and any negative impact such repayment could have on access to
services when determining the amount of recoupment for an overpayment.
This section also prohibits any collection of repayments until 60 days
after the final audit findings or final hearing determination.
§ 3 and § 4, amends subdivision 1 of section 35 of public health law,
requiring OMIG to consult with the Commissioners of the Department of
Health and Offices of Mental Health, Addiction Services and Supports and
Developmental Disabilities on preparing and filing an annual report on
the impacts that all civil and administrative enforcement actions taken
in the previous year have had and will have on the quality and avail-
ability of medical care and services, the best interests of the medical
assistance program and its recipients, and how many audits used extrapo-
lation.
§ 5 Effective date of April 1, 2026.
 
JUSTIFICATION:
When the OMIG was created in 2007, the emphasis of the legislature and
the concern of the public was fraud and waste in the Medicaid system.
Experience with the law has made it clear that the current statute is
missing key provisions necessary to assure fairness and procedural clar-
ity for all the parties involved, including the personnel of the OMIG.
OMIG audits that punish providers for technical errors- not fraud or
abuse- do not help anyone in the Medicaid system, especially when those
errors are the result of unclear guidance or a lack of transparency.
This over-reaching approach will ultimately lead to less accessible care
and higher Medicaid costs, as people are forced to forego earlier care.
OMIG's practice of extrapolating millions of dollars in claims from a
small sample of technical errors, to meet its inflated budget targets,
is forcing already stretched-thin health, behavioral health and human
services providers to spend excessive resources on compliance and legal
defense, instead of needed health care. Such OMIG audit practices
threaten the continued viability of safety net providers, and at least
one provider has been forced to close its doors. New York's patients
cannot afford to have resources diverted, especially over unintentional
administrative errors. This bill will reign in these excessive practices
and bring equity to the Medicaid audit process
 
PRIOR LEGISLATIVE HISTORY:
2021-2022: S4486B/A7889A - Vetoed Memo. 89
2023-2024: A6813C/S5329E, amend and recommit to ways and means, Passed
senate
 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
None.
 
EFFECTIVE DATE:
This act shall take effect April 1, 2026

Statutes affected:
S4955: 30-a public health law, 32 public health law, 32(20) public health law, 363-d social services law, 363-d(3) social services law
S4955A: 30-a public health law, 35 public health law, 35(1) public health law