Attorney General James Secures $1.85 Million Following Medicaid Fraud by Global IT Company

Computer Sciences Corporation Used Statewide 
Children’s Program to Misappropriate Taxpayer Funds

NEW YORK – New York Attorney General Letitia James reached an agreement with former multinational internet technology company, Computer Sciences Corporation (CSC), resulting in $1.85 million in recovered funds, with nearly $1 million earmarked for New York state. The investigation revealed that the company violated state and federal law by improperly processing Medicaid claims for services rendered as a part of New York’s Early Intervention Program, the statewide program for infants and toddlers under the age of three who might have a developmental delay or disability. 

“It is unconscionable that a company would be so irresponsible to cut corners on a program dedicated to our youngest New Yorkers in need of help and end up diverting hard-earned taxpayer dollars from where they need to go,” said Attorney General Letitia James. “On my watch, illegal schemes at the expense of taxpayers — or our children — will not go unchecked. My office will continue to hold providers and their agents who fail to appropriately and responsibly administer Medicaid programs in New York state accountable.”  

CSC, now known as DXC Technology, violated the U.S. and New York State False Claims Act between 2009 and 2013. As part of this agreement, CSC admitted that it performed insurance-claims-handling and -processing services on behalf of New York City regarding the City’s administration of the Early Intervention Program, which resulted in payments to the City that Medicaid would not otherwise have made. Specifically, CSC admitted that it utilized two coding mechanisms for their billing submissions that resulted in Medicaid making improper payments to the City. The investigation was triggered by a whistleblower lawsuit filed under the qui tam provisions of the federal and New York False Claims Acts, which allow people to file civil actions on behalf of the government and share in any recovery. The whistleblower in this case will receive $416,250 of the settlement proceeds from New York state and the federal government, combined. The state of New York will receive $989,565. 

The investigation and settlement were the result of a coordinated effort among the Office of the Attorney General (OAG) and the U.S. Attorney’s Office for the Southern District of New York.  

The Medicaid Fraud Control Unit (MFCU) receives 75 percent of its funding from the U.S. Department of Health and Human Services under a grant award totaling $60,071,905 for federal fiscal year (FFY) 2019-20, of which $45,053,932 is federally funded. The remaining 25 percent of the approved grant, totaling $15,017,973 for FFY 2019-20, is funded by New York state. Through MFCU’s law enforcement actions and civil enforcement actions, its recoveries for New York exceed its budget expenditures.

This case was handled for OAG by Special Assistant Attorney Generals David Abrams and Veronica R. Jordan-Davis under the supervision of the MFCU Chief-Civil Enforcement Division, Alee N. Scott. This case was investigated by MFCU Principal Auditor-Investigator Michael Beers and Senior Auditor-Investigators Matthew Tandle and Colin Ware, with the assistance of Chief Auditor Civil Enforcement Division Stacey Millis. Investigative support was provided by Confidential Legal Assistant Adrianna Duggan and by the following members of MFCU’s Electronic Investigative Support Group and Data Analytics Team (EISG) under the supervision of EISG Director Michael Wassell: IT Support Specialist Maria Castro, Confidential Systems Analyst Charles Martellaro,  Lead Data Scientist Si Lok Chao, Database Administrator John Kilic, and EISG Deputy Director Carolyn Hart. MFCU is led by Director Amy Held and Assistant Deputy Attorney General Paul J. Mahoney. The Division of Criminal Justice is led by Chief Deputy Attorney General for Criminal Justice José Maldonado, and overseen by First Deputy Jennifer Levy.