Office of Medicaid Inspector General

The 21-day amendments to the Executive Budget recommend the following changes (analysis as of February 13, 2008):

• Decreases the MA Audit and Fraud Prevention Program’s personal service appropriation by $2 million.  This results in an appropriation of $18.9 million, which is an increase of $2.05 million from the FY 2007-08 enacted budget.  According to the 21-day amendments’ appropriations narrative the General Fund personal service is reduced to reflect vacancy savings.
•  Article VII amendments to clarify language relating to the disclosure of personal income tax return information to the Office of the Medicaid Inspector General.  It clarifies that the information disclosed would be “information derived from NYS personal income tax returns, estate tax returns or corporate franchise tax returns or reports filed with the department of taxation and finance.”

The Executive Budget recommends (analysis as January 31, 2008):

A SFY 2008-09 workforce of 753.  This increases the level of FTEs from the adjusted FTE level for FY 2007-08 by 75.  The following chart identifies adjustments in the current fiscal year’s FTEs along with the recommended differences in FY 2008-09 FTEs by program (if the FTE’s are the same the program is not listed):

• The increase of 75 FTEs includes, according to the Assembly, 55 new auditors; 9 internal control and counsel staff; 8 staff to support front end edits, prepayment reviews and revenue initiatives; and 3 staff to support the expansion of the Card Swipe program. According to the Agency Presentation the increase in staff is “to improve the State’s ability to combat fraud, waste and abuse in the Medicaid Program.”  However, the Executive Budget Workforce Impact Summary Report indicates that there is a proposed increase of 227 FTEs.  The Agency Presentation makes reference to both figures by stating “an increase of 227, which reflect 75 new staff and the hiring of currently authorized staff.”  We believe the difference reflects the annualization of staffing approved for the current year.  However, the Assembly analysis states that there is a combined increase of $9.2 million in General Fund and Federal funding to support the annualization of 157 FTEs added as part of the SFY 2007-08 budgets.  This discrepancy should be clarified at statewide labor management.

• The total appropriation for Personal Service is $23.3 million, a 4.3% increase from SFY 2007-08.

• The following program had a decrease in personal service funding that is not associated with a decrease in FTEs. These funding and position changes should be clarified with management:
  1. Medical Assistance Program, MU account within the Medicaid Audit & Fraud Prevention Program (-$3 million).  According to the Assembly analysis this decrease is related to the shift of the State University of New York clinical review contract from the OMIG to the Department of Health.

• An All Funds decrease of $6.2 million (6.3%) from SFY 2007-08.  

• According to the Assembly analysis there is a combined increase of $4.9 million in General Fund and Federal funding to support re-estimates of State Operations and fixed costs related to personal and nonpersonal service. 

• The Office of the Medicaid Inspector General (OMIG) employed an estimated 112 employees under consultant contracts in SFY 2007-08 at a cost of $8.7 million or an average cost of $77,906 per consultant contract employee.  It is estimated that $9.9 million will be allocated for consultant contracts in SFY 2008-09 for 131 employees, at a cost of $75,779. 

• Article VII legislation continues efforts to strengthen the State’s anti-fraud capabilities by (1) requiring the Office of the Attorney General to provide the OMIG with complaints and evidence related to false claims actions (2) allowing civil recoupment of misappropriated Medicaid funds; and (3) expanding the OMIG’s access to providers’ tax return records.