Requires the Medicaid inspector general to comply with standards relating to the audit and review of medical assistance program funds.
A01069 would revise the Public Health Law to place new procedural and substantive limits on audits and recoveries conducted by the Medicaid Inspector General (OMIG) involving medical assistance program funds. The bill defines key terms such as “overpayment,” “applicable standards,” and “clerical or minor error or omission,” and requires OMIG to use the standards in effect when the provider’s conduct occurred. It also requires OMIG to publish current audit protocols in advance, provide providers access to applicable standards, and explain any sampling, extrapolation, or rejection of provider-submitted documentation in draft and final audit reports.
The bill further directs OMIG to consider several factors before determining repayment amounts, including whether errors are isolated, whether the provider’s solvency would be affected, and whether repayment could reduce access to services. It limits extrapolation for isolated clerical or minor errors of three or fewer claims, allows providers to settle at the lower confidence limit plus interest even while seeking a hearing, and delays recoupment or repayment until at least 60 days after a final audit report or hearing determination. It also amends OMIG annual reporting requirements to include more detail about audits, recoveries, extrapolation use, and compliance with statutory requirements to consider service quality and availability.
If enacted, the bill would change how OMIG audits Medicaid providers and recovers alleged overpayments by imposing clearer notice, documentation, and methodology requirements, as well as limits on extrapolation in certain minor-error cases. It would affect providers participating in the Medicaid program, especially hospitals, nursing homes, home care agencies, and other medical assistance providers subject to OMIG review, and could reduce or delay some recoupments while increasing transparency and procedural protections. The bill also expands OMIG’s annual reporting obligations and reinforces consideration of provider financial stability and patient access when pursuing enforcement actions.
The available voting history suggests strong support for the bill at the committee level, with the Assembly Health Committee voting 25-0 to refer it favorably to Ways and Means. The bill’s sponsors and supporters appear to view it as a fairness and transparency measure that better balances fraud control with provider due process and patient access to care. No opposing testimony is provided in the record, but the structure of the bill indicates a policy response to concerns about aggressive audit practices and extrapolated recoveries.
The main points of contention are likely to be OMIG’s audit authority versus provider protections, especially the use of statistical extrapolation, the treatment of minor clerical errors, and the timing of recoupment. Providers and their advocates would likely favor the bill’s requirements for advance disclosure, written explanations, and limits on extrapolation, while the state and anti-fraud advocates may be concerned that the bill could make it harder to recover improper Medicaid payments efficiently. Another likely issue is the bill’s requirement that OMIG weigh financial solvency and access to services before ordering repayment, which could be seen as constraining enforcement discretion.