New York State Comptroller Thomas P. DiNapoli announced today the following audits have been issued.

Empire BlueCross – Overpayments for Physician-Administered Drugs (Follow-Up) (2024-F-34) 

The New York State Health Insurance Program (NYSHIP) is administered by the Department of Civil Service (Civil Service). The Empire Plan is the primary health insurance plan for NYSHIP, and Civil Service contracts with Anthem Blue Cross (Anthem), formerly Empire BlueCross, to administer the Hospital Program of the Empire Plan and to process and pay claims for hospital services. Hospital benefits cover a range of services including physician-administered drugs, which are drugs administered by health care professionals in a hospital or facility setting. A prior audit, issued in September 2023, identified over $2.7 million in actual and potential overpayments for physician-administered drugs. Anthem officials made progress in addressing the problems identified in the initial audit, recovering over $600,000 of the overpaid claims and taking steps to make more recoveries. Of the initial report’s seven audit recommendations, two were implemented, four were partially implemented, and one was not implemented.

New York City Department for the Aging – Case Management (Follow-Up) (2025-F-3) 

The New York City Department for the Aging (DFTA) contracts with community-based organizations (providers) to provide case management services, which help older persons with functional impairments gain access to appropriate services, benefits, and entitlements needed to age safely at home and maintain their quality of life. Case management providers must adhere to DFTA’s Case Management Standards of Operations and Scope of Services (Standards), which detail when intake assessments and reassessments must be performed, as well as wait list prioritization. A prior audit, issued in July 2023, found that DFTA did not ensure that its contracted providers adhered to the Standards; therefore, key milestones for delivering and monitoring services needed for vulnerable seniors were not always met. Additionally, DFTA reimbursed providers for $10,480 in claimed expenses that had insufficient supporting documentation or were unrelated to the case management program. DFTA made some progress in addressing the initial audit report’s eight recommendations, implementing one, partially implementing four, and not implementing three.

Department of Health – Improper Medicaid Payments During Permissible Overlapping Medicaid and Essential Plan Coverage (Follow-Up) (2024-F-40)

The Department of Health (DOH) administers the State’s Medicaid program and the Essential Plan, both of which provide health care services to individuals who are economically disadvantaged. As eligibility factors change, individuals may transition between Medicaid and the Essential Plan, resulting in DOH-authorized periods of overlapping coverage and the Essential Plan should be the primary payer and Medicaid, as secondary payer, should pay any remaining liabilities, such as deductibles and coinsurance. A prior audit, issued in September 2023, found Medicaid improperly paid $93.7 million in claims during periods of overlapping Medicaid and Essential Plan coverage because DOH did not account for the Essential Plan as a liable primary payer. DOH officials made some progress in addressing the problems identified in the initial audit report, but minimal progress in recovering the improper payments identified by the initial audit. Of the initial report’s two audit recommendations, one was partially implemented and one was not implemented.

Homes and Community Renewal: Division of Housing and Community Renewal – Physical and Financial Conditions at Selected Mitchell-Lama Developments in New York City (Follow-Up) (2024-F-30) 

The Mitchell-Lama Housing program was created to provide affordable rental and cooperative housing to middle-income families. A prior audit, issued in June 2023, found DHCR did not adequately oversee the physical and financial conditions at the sampled developments, likely causing management at those developments to misspend funds and fail to provide a safe and clean living environment for their residents. DHCR officials made some progress in addressing the issues identified in the initial audit report, but auditors observed additional hazardous and unsanitary conditions on follow-up, including rodent infestations, mold, and peeling paint. Of the initial report’s nine audit recommendations, one was implemented, six were partially implemented, and two were not implemented.

Department of Health – Medicaid Claims Processing Activity April 1, 2024 Through September 30, 2024 (2024-S-5) 

During the 6-month period ended September 30, 2024, the Department of Health’s eMedNY computer system processed almost 249 million claims, resulting in payments to providers of nearly $50.6 billion. OSC’s audit of claims processing activity identified over $11.5 million in improper Medicaid payments for claims that were not processed in accordance with Medicaid requirements. The audit also identified 14 Medicaid providers who were charged with or found guilty of crimes that violated laws or regulations governing certain health care programs.

Department of Health: Medicaid Program – Improper Fee-for-Service Pharmacy Payments for Recipients With Third-Party Health Insurance (Follow-Up) (2024-F-25) 

When Medicaid recipients have other third-party health insurance (TPHI) in addition to Medicaid, fee-for-service (FFS) providers are required to coordinate benefits with the recipient’s TPHI for payment prior to billing Medicaid. The Office of the Medicaid Inspector General (OMIG) contracted with Gainwell Technologies to identify and recover Medicaid payments made for services that should have been paid for by a recipient’s TPHI. A prior audit, issued in May 2023, determined DOH and OMIG lacked adequate oversight of Gainwell’s recovery process to ensure all available recoveries on FFS pharmacy payments were made. The audit also found claims processing improvements could be made to prevent TPHI overpayments from occurring. DOH and OMIG officials made minimal progress in addressing the problems identified in the initial audit report. Of the initial report’s eight recommendations, one was implemented, two were partially implemented, and five were not implemented.

Office for People With Developmental Disabilities – Pandemic Planning and Care for Vulnerable Populations (Follow-Up) (2024-F-23) 

The Office for People with Developmental Disabilities (OPWDD) is responsible for certifying and regulating all residential facilities and providing guidance and best practices to its own staff at State-operated facilities and voluntary agencies that deliver direct care to people with intellectual and developmental disabilities. One component of OPWDD’s mission is providing a safe environment, including disaster preparedness. A prior audit, issued in April 2023, found OPWDD developed and issued specific COVID-19 pandemic plans to only State-operated Intermediate Care Facilities, which accounted for less than 1% of OPWDD’s residential clients. Additionally, while OPWDD’s emergency management and overarching emergency planning documents considered pandemics as a risk even before COVID-19, OPWDD did not take proactive steps to ensure that all homes had followed suit in their own emergency plans. OPWDD made progress in addressing the problems identified in the initial audit report, partially implementing all four recommendations.

New York State Health Insurance Program – Incorrect Payments by CVS Caremark for Medicare Rx Drug Claims That Were Improperly Paid Under the Commercial Plan (Follow-Up) (2025-F-1) 

The Empire Plan is the primary health benefits plan for the New York State Health Insurance Program, administered by the Department of Civil Service (Civil Service). Civil Service contracts with CVS Caremark to administer the prescription drug program for the Empire Plan, which includes the Empire Plan Medicare Rx drug plan (Medicare Rx Plan) for retired members and their dependents who qualify for Medicare, and the Commercial Plan for members and their dependents who do not qualify for Medicare. Claims paid under the Medicare Rx Plan are eligible for enhanced drug manufacturer discounts and federal subsidies that are not available for claims paid under the Commercial Plan. A prior audit, issued in September 2023, identified claims totaling $12,358,531 that were incorrectly paid under the Commercial Plan instead of the Medicare Rx Plan. Civil Service and CVS Caremark made some progress in addressing the issues identified in the initial audit, partially implementing all three of initial report’s recommendations and reprocessing over $5 million in claims under the Medicare Rx Plan. However, they did not evaluate or put in place additional controls to prevent claims from being inappropriately paid under the Commercial Plan, and, consequently, auditors identified $1.37 million in claims paid under the Commercial Plan for Medicare-eligible members since the initial audit (from April 2022 through December 2024).

Office of Addiction Services and Supports – Addiction Support Services During Emergencies (Follow-Up) (2024-F-39) 

The Office of Addiction Services and Supports (OASAS) certifies providers to operate substance use disorder and problem gambling treatment and prevention programs (Programs) and conducts unannounced recertification reviews to assess providers’ compliance with regulatory requirements. OASAS also requires providers to maintain waiting lists for clients awaiting treatment and certain providers to develop, maintain, and update an Emergency Preparedness Plan (Plan) to address emergencies that may present an immediate danger to personnel, patients, Programs, and/or property. Further, the state created the New York State Evacuation of Facilities in Disasters System (eFINDS) application to track in real time the location of individuals being cared for in facilities and on-duty staff when relocation occurs during an emergency. A prior audit, issued in November 2023, found OASAS should improve the extent and clarity of its guidance to include strategies to manage and mitigate prolonged service disruptions and continue to deliver addiction support services; improve its monitoring of providers’ Plans; and do more to ensure that providers have access to and use eFINDS and improve the accuracy and usefulness of its waiting lists. OASAS has made little progress in addressing the problems identified in the initial audit report, implementing none of the initial report’s three recommendations.