New York Comptroller Finds $700 Million in Medicaid Waste

The comptroller of New York has identified hundreds of millions of dollars in wasteful spending as part of the state's Medicaid program.

In an announcement posted to the state's website, Thomas P. DiNapoli said that five audits of the New York Department of Health's Medicaid program found $706.6 million in unnecessary payments.

"The state is facing budget gaps of billions of dollars because of the COVID-19 crisis and needs to find cost savings wherever it can," DiNapoli said. "Hundreds of millions of dollars could be saved with better financial and management controls over the state's Medicaid program. In recent years, my auditors have identified billions of dollars in waste in the program.

"Our oversight of the program will continue in earnest as DOH can do much more to save taxpayer dollars."

The biggest contributor to unnecessary spending is prescription drug costs, with the investigation finding that $605 million was spent on drugs that could have been swapped out for lower-cost options. That was followed by suspicion of duplicate payments being made to Medicaid recipients ($47.8 million), payments to people who had terminated their Medicaid coverage ($11.7 million), payments to deceased persons ($4.9 million), improper payments to healthcare providers ($8.2 million), and payments for prescription drugs that had been removed from the market ($29 million).

The audit looked at varying time periods for each abovementioned category, ranging from six months to more than five years.

State budgets nationwide are in flux this year as the COVID-19 pandemic shrinks tax revenue and forced state health programs to shell out more money to help residents who have fallen ill.

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