A.G. Schneiderman Recovers $1.6 Million For Taxpayers In Local & Other Fraud Investigations

Three Settlement Agreements Follow the Launch of Major AG Initiative to Bolster Medicaid Fraud Control Unit And Protect Taxpayers

Dutchess County Dental Practice & Other Organizations to Repay Taxpayers

POUGHKEEPSIE – Attorney General Eric T. Schneiderman today announced three settlement agreements in Medicaid fraud investigations that total more than $1.6 million in recovered funds for taxpayers, including from dental practices in Dutchess County. The agreements come on the heels of Attorney General Schneiderman’s launch of a major initiative to bolster his office’s Medicaid Fraud Control Unit and create a Taxpayer Protection Bureau to increase fraud recoveries during a period of fiscal crisis. The Attorney General made the announcement following his address to the Dutchess County Bar Association in Poughkeepsie.

“As I said when we unveiled our new Taxpayer Protection Bureau, this office will leave no stone unturned in the quest to save money for taxpayers by rooting out waste, fraud, and corruption wherever we find it,” said Attorney General Schneiderman. “In these cases, New York State taxpayers were being short-changed through over-billing, sloppy record-keeping, and unnecessary medical procedures. Given the budget challenges we face, this is unacceptable, and we will work every day to ensure those who cheat the taxpayers are caught and forced to pay for their crimes.”
Schneiderman announced the following three fraud settlements today:

  • Patrick Mascarenhas owns Delancey Dental, P.C. and Tru-Dental, P.C., dental practices and has several offices throughout Dutchess County, including in Beacon, Hyde Park, Pawling, and Poughkeepsie, as well as others across the state. Medicaid rules and regulations require medical records to demonstrate medical necessity for dental fillings, which the dental practices did not do for the period of January 2002 through February 2008. They have agreed to the pay the state $376,560.
  • Queens Medical Associates, P.C., a Queens-based, hematology and oncology group practice, has repaid the State $851,927.16 for overbilling the Medicaid program.  An investigation by the Attorney General’s Medicaid Fraud Control Unit (MFCU) revealed that the practice improperly overbilled Medicaid for physician-administered drugs, in violation of state law.  Under New York State law, to ensure that medical judgment is not improperly influenced by financial considerations, doctors are not permitted to make a profit on the drugs they dispense, which was the case in this matter. The practice also billed Medicaid as the primary insurance on claims that should have been paid 80 percent by Medicare.

This investigation was part of an ongoing project undertaken by MFCU to investigate wide-spread failure of physicians to properly submit claims for injectable drugs, commonly known as J code claims, in compliance with state pricing standards and other matters.  To date, this review has resulted in the recovery of over $17.5 million from more than 144 providers, including hospitals, physician group practices and individual physicians throughout New York State, and the criminal prosecution of two providers as an off-shoot of these investigations.

  • Absolute Home Health Care, Inc., a licensed home care services agency located in Mount Vernon, has agreed to repay the State $397,000 as a result of an investigation that revealed sloppy record keeping. An investigation into Absolute’s Medicaid billings for the period of February 2002 through September 2007 revealed that Absolute failed to maintain records, such as time sheets and nurses notes, which would have verified whether the nursing services for which it billed were in fact provided. Medicaid rules and regulations require health care providers to maintain records supporting their right to reimbursement.

Last month, the Attorney General announced the recovery of $18 million from Young Adult Institute (YAI), the state’s largest residential services provider. The investigation found that YAI had inflated its expense reports to claim additional Medicaid funding that it was not entitled to receive. Of the total amount YAI will pay in damages, more than $10 million will be returned to the New York State Medicaid program.

In recent weeks, the Attorney General announced his plan to enhance MFCU by adding dozens of new prosecutors, investigators and auditors to the team cracking down on Medicaid fraud and abuse, and help recover additional funds for the state. Similarly, Schneiderman’s newly created Taxpayer Protection Bureau will make use of the Fraud Enforcement and Recovery Act he authored to expand New York’s False Claims Law. In doing so, the Attorney General’s Office has the power to crack down on large-scale, multi-state corporate tax fraud schemes, effectively prosecute corrupt contractors, and recover millions of wasted taxpayer dollars.
The Absolute Home Care and Mascarenhas investigations were led by Special Assistant Attorney General William T. McClarnon and Regional Director Anne Schaible Jardine of MFCU’s Pearl River Regional Office, assisted by Regional Chief Auditor John Regan, Principal Special Auditor Investigator Jean Moss, Associate Special Auditor Investigators John Annunziata and Sandra Alvarez, and Senior Special Investigators Frank Fizzinoglia and Frank DiChiaro.  The Queens Medical Associates P.C., investigation was led by Special Assistant Attorney General Laura J. Meehan under the supervision of Special Projects Unit Director Jay S. Speers, assisted by Associate Special Auditor Investigator Karin Flynn.  All three investigations were conducted under the supervision of Monica J. Hickey-Martin, First Assistant Attorney General, and Paul J. Mahoney, Civil Enforcement Division Chief.

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