BILL NUMBER: S10681
SPONSOR: MURRAY
 
TITLE OF BILL:
An act to amend the public health law and the state finance law, in
relation to establishing a Medicaid fraud tip board and Medicaid fraud
tip reward fund
 
SUMMARY OF PROVISIONS:
Section 1 adds a new section 37 to the Public Health Law to establish a
Medicaid Fraud Tip Board for the purpose of developing and administering
a system to provide monetary rewards to individuals whose documented
tips result in the closing of a Medicaid fraud case and a guilty plea or
criminal conviction.
The seven-member board would be appointed by the Governor, Lieutenant
Governor, Majority Leader of the Senate, Speaker of the Assembly, Minor-
ity Leader of the Senate, and Minority Leader of the Assembly. The
board would meet at least twice annually to review pending reward appli-
cations and determine eligibility and reward amounts. It would also
establish eligibility guidelines, minimum and maximum reward amounts,
and procedures to preserve the anonymity and protect the personal and
banking information of individuals alleging Medicaid fraud.
Section 2 adds a new section 97-bbbbb to the State Finance Law to estab-
lish the Medicaid Fraud Tip Reward Fund in the joint custody of the
State Comptroller and Commissioner of Taxation and Finance. The fund
would consist of not less than one percent nor more than two percent of
money recovered by the state through Medicaid fraud enforcement, as well
as any other moneys appropriated, credited, or transferred to the fund
pursuant to law. Moneys in the fund would be used solely to pay eligible
individuals pursuant to determinations of the Medicaid Fraud Tip Board.
Section 3 provides the effective date.
 
JUSTIFICATION:
Medicaid fraud diverts limited public resources away from the New York-
ers who depend upon the Medicaid program for access to health care and
imposes unnecessary costs on taxpayers. Individuals with direct know-
ledge of fraudulent activity can provide valuable information to inves-
tigators and prosecutors, but potential informants may have little
incentive to come forward, particularly when doing so may involve
personal or professional risk.
This legislation creates a structured financial incentive for individ-
uals to report Medicaid fraud that ultimately results in a successful
criminal case. Rewards would not be paid merely for making an allega-
tion. Rather, the bill requires that a documented tip result in the
closing of a Medicaid fraud case and a guilty plea or criminal
conviction before an individual may receive a reward. This approach
rewards information that produces tangible enforcement results while
allowing the Medicaid Fraud Tip Board to establish appropriate eligibil-
ity standards and payment amounts.
The bill also recognizes that confidentiality can be critical to encour-
aging individuals to report wrongdoing. The Medicaid Fraud Tip Board is
therefore specifically required to establish procedures to preserve the
anonymity of individuals alleging Medicaid fraud and to protect
personally identifying and banking information.
Importantly, the reward program would be supported by a dedicated fund
derived in part from moneys recovered through Medicaid fraud enforce-
ment. By directing between one and two percent of Medicaid fraud recov-
eries to the reward fund, the legislation dedicates a portion of recov-
ered funds to encouraging the identification and successful prosecution
of additional fraud.
Providing a meaningful incentive for individuals with credible, actiona-
ble information to come forward can strengthen New York's Medicaid fraud
enforcement efforts, increase recoveries, deter future misconduct, and
help protect both taxpayers and the integrity of the Medicaid program.
 
PRIOR LEGISLATIVE HISTORY:
New bill
 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
The Medicaid Fraud Tip Reward Fund would receive not less than one
percent nor more than two percent of moneys recovered by the state
through Medicaid fraud enforcement, along with any other moneys appro-
priated, credited, or transferred to the fund pursuant to law.
 
EFFECTIVE DATE:
The ninetieth day after it shall have become a law.