Amd §§30-a & 32, add §§37 & 38, Pub Health L; amd §363-d, Soc Serv L
Amends provisions relating to audit and review of medical assistance program funds by the Medicaid inspector general; prohibits additional review without error or new information; requires application of rules in place at the time funds were paid to providers; requires notice to recipients of medical assistance funds of certain investigations.
STATE OF NEW YORK
________________________________________________________________________
7889--A
2021-2022 Regular Sessions
IN ASSEMBLY
May 28, 2021
___________
Introduced by M. of A. GOTTFRIED, L. ROSENTHAL, McDONALD, ABINANTI,
VANEL -- read once and referred to the Committee on Health -- recom-
mitted to the Committee on Health in accordance with Assembly Rule 3,
sec. 2 -- reported and referred to the Committee on Ways and Means --
committee discharged, bill amended, ordered reprinted as amended and
recommitted to said committee
AN ACT to amend the public health law and the social services law, in
relation to the functions of the Medicaid inspector general with
respect to audit and review of medical assistance program funds and
requiring notice of certain investigations
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 30-a of the public health law is amended by adding
2 four new subdivisions 4, 5, 6 and 7 to read as follows:
3 4. "Provider" means any person or entity enrolled as a provider in the
4 medical assistance program.
5 5. "Recipient" means an individual who is enrolled in the medical
6 assistance program, including an individual who was previously a recipi-
7 ent and, in an appropriate case, an individual who is legally responsi-
8 ble for the recipient.
9 6. "Medical assistance" and "Medicaid" means title eleven of article
10 five of the social services law and the program thereunder.
11 7. "Draft audit report", "initial audit report", "proposed notice of
12 agency action" and "final notice of agency action" means those documents
13 prepared and issued by the inspector under this title and corresponding
14 regulations.
15 § 2. Subdivision 20 of section 32 of the public health law, as added
16 by chapter 442 of the laws of 2006, is amended to read as follows:
17 20. to, consistent with [provisions of] this title and applicable
18 federal and state laws, regulations, policies, guidelines and standards,
19 implement and amend, as needed, rules and regulations relating to the
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD11500-02-2
A. 7889--A 2
1 prevention, detection, investigation and referral of fraud and abuse
2 within the medical assistance program and the recovery of improperly
3 expended medical assistance program funds;
4 § 3. The public health law is amended by adding two new sections 37
5 and 38 to read as follows:
6 § 37. Procedures, practices and standards. 1. Subject to federal law
7 or regulation, recovery of an overpayment resulting from the issuance of
8 a final audit report or final notice of agency action by the inspector
9 shall commence not less than sixty days after the issuance of the final
10 audit report or final notice of agency action. The inspector shall not
11 commence any recovery under this subdivision without providing a minimum
12 of ten days advance written notice to the provider.
13 2. Contracts, cost reports, claims, bills or expenditures of medical
14 assistance funds that were the subject matter of a previous audit or
15 review by or on behalf of the inspector, within the last three years,
16 shall not be subject again to review or audit except on the basis of new
17 information, for good cause to believe that the previous review or audit
18 was erroneous, or where the scope of the inspector's review or audit is
19 significantly different from the scope of the previous review or audit.
20 3. In conducting reviews or audits, the inspector shall apply the
21 laws, regulations, policies, guidelines, standards and interpretations
22 of the appropriate agency, including temporary or emergency regulations,
23 policies, guidelines, standards and interpretations, that were in place
24 at the time the subject claim arose or other conduct took place. Disal-
25 lowances may be imposed or other action taken only for non-compliance
26 with those laws, regulations, policies, guidelines or standards. For
27 purposes of this subdivision, any change in those laws, regulations,
28 policies, guidelines, standards or interpretations shall only be applied
29 prospectively and upon reasonable notice.
30 4. (a) The inspector shall make no recovery from a provider, based on
31 an administrative or technical defect in procedure or documentation made
32 without intent to falsify or defraud, in connection with claims for
33 payment for medically necessary care, services and supplies or the cost
34 thereof as specified in subdivision two of section three hundred sixty-
35 five-a of the social services law provided in other respects appropri-
36 ately to a beneficiary of the medical assistance program, except as
37 provided in paragraphs (b) and (c) of this subdivision.
38 (b) Where there is an administrative or technical defect in procedure
39 or documentation without intent to falsify or defraud, the inspector
40 shall afford the provider an opportunity to correct the defect and
41 resubmit the claim within thirty days of notice of the defect.
42 (c) Where a claim relates to a service that was provided more than two
43 years prior to the commencement of the audit, the provider may submit or
44 resubmit the claim or accept the disallowance of the amount of the
45 claim.
46 5. (a) The inspector shall furnish to the provider at an audit exit
47 conference or in any draft audit findings issued or to be issued to the
48 provider, a detailed written explanation of the extrapolation method
49 employed, including the size of the sample, the sampling methodology,
50 the defined universe of claims, the specific claims included in the
51 sample, the results of the sample, the assumptions made about the accu-
52 racy and reliability of the sample and the level of confidence in the
53 sample results, and the steps undertaken and statistics utilized to
54 calculate the alleged overpayment and any applicable offset based on the
55 sample results. This written information shall include a description of
56 the sampling and extrapolation methodology.
A. 7889--A 3
1 (b) The sampling and extrapolation methodologies used by the inspector
2 shall be statistically reasonably valid for the intended use and shall
3 be established in regulations of the inspector.
4 § 38. Procedures, practices and standards for recipients. 1. This
5 section applies to any adjustment or recovery of a medical assistance
6 payment from a recipient, and any investigation or other proceeding
7 relating thereto.
8 2. At least five business days prior to commencement of any interview
9 with a recipient as part of an investigation, the inspector or other
10 investigating entity shall provide the recipient with written notice of
11 the investigation. The notice of the investigation shall set forth the
12 basis for the investigation; the potential for referral for criminal
13 investigation; the individual's right to be accompanied by a relative,
14 friend, advocate or attorney during questioning; contact information for
15 local legal services offices; the individual's right to decline to be
16 interviewed or participate in an interview but terminate the questioning
17 at any time without loss of benefits; and the right to a fair hearing in
18 the event that the investigation results in a determination of incorrect
19 payment.
20 3. Following completion of the investigation and at least thirty days
21 prior to commencing a recovery or adjustment action or requesting volun-
22 tary repayment, the inspector or other investigating entity shall
23 provide the recipient with written notice of the determination of incor-
24 rect payment to be recovered or adjusted. The notice of determination
25 shall identify the evidence relied upon, set forth the factual conclu-
26 sions of the investigation, and explain the recipient's right to request
27 a fair hearing in order to contest the outcome of the investigation. The
28 explanation of the right to a fair hearing shall conform to the require-
29 ments of subdivision twelve of section twenty-two of the social services
30 law and regulations thereunder.
31 4. A fair hearing under section twenty-two of the social services law
32 shall be available to any recipient who receives a notice of determi-
33 nation under subdivision three of this section, regardless of whether
34 the recipient is still enrolled in the medical assistance program.
35 § 4. Paragraph (c) of subdivision 3 of section 363-d of the social
36 services law, as amended by section 4 of part V of chapter 57 of the
37 laws of 2019, is amended and a new subdivision 8 is added to read as
38 follows:
39 (c) In the event that the commissioner of health or the Medicaid
40 inspector general finds that the provider does not have a satisfactory
41 program [within ninety days after the effective date of the regulations
42 issued pursuant to subdivision four of this section], the commissioner
43 or Medicaid inspector general shall so notify the provider, including
44 specification of the basis of the finding sufficient to enable the
45 provider to adopt a satisfactory compliance program. The provider shall
46 submit to the commissioner or Medicaid inspector general a proposed
47 satisfactory compliance program within sixty days of the notice and
48 shall adopt the program as expeditiously as possible. If the provider
49 does not propose and adopt a satisfactory program in such time period,
50 the provider may be subject to any sanctions or penalties permitted by
51 federal or state laws and regulations, including revocation of the
52 provider's agreement to participate in the medical assistance program.
53 8. Any regulation, determination or finding of the commissioner or the
54 Medicaid inspector general relating to a compliance program under this
55 section shall be subject to and consistent with subdivision three of
56 this section.
A. 7889--A 4
1 § 5. Section 32 of the public health law is amended by adding a new
2 subdivision 6-b to read as follows:
3 6-b. to consult with the commissioner on the preparation of an annual
4 report, to be made and filed by the commissioner on or before the first
5 day of July to the governor, the temporary president of the senate, the
6 speaker of the assembly, the minority leader of the senate, the minority
7 leader of the assembly, the commissioner, the commissioner of the office
8 of addiction services and supports, and the commissioner of the office
9 of mental health on the impacts that all civil and administrative
10 enforcement actions taken under subdivision six of this section in the
11 previous calendar year will have and have had on the quality and avail-
12 ability of medical care and services, the best interests of both the
13 medical assistance program and its recipients, and fiscal solvency of
14 the providers who were subject to the civil or administrative enforce-
15 ment action;
16 § 6. This act shall take effect immediately.
