Feds sue Hochul officials, claim massive fraud scheme in revamp of NYs $11B Medicaid homecare program

The US Department of Justice filed a lawsuit against Gov.Kathy Hochul’s administration Tuesday claiming it rigged the bids on an $11 billion Medicaid homecare program — allowing a handpicked company to siphon off millions in taxpayer money.State Health Commissioner James McDonald and Medicaid Director Amir Bassiri are both named in the lawsuit which lays out startling new allegations that claim Hochul’s administration schemed to consolidate payroll services for nearly 250,000 homecare recipients under Public Partnerships LLC and moved forward with the disastrous transition despite clear warning signs of the coming chaos.“New York’s failure to police a favored vendor that unlawfully siphoned millions of dollars of Medicaid funding is egregious and betrays the public trust,” Brett A.

Shumate, assistant attorney general for the Department of Justice’s Civil Division, wrote in a statement.“The Justice Department is acting to ensure that federal laws regarding truthful statements and fair dealing in federal health care programs are upheld and to prevent additional harm from being exacted against the public by PPL and New York,” Shumate added.Hochul is not directly accused of wrongdoing in the 55-page complaint filed in US District Court Eastern District of New York but snippets of emails between her office, the health department and PPL uncovered by federal investigators show she was actively involved in not only the transition process, but also the awarding of the bid to the company.“As late as Tuesday, September 17, 2024, Defendant BASSIRI was part of last-minute email exchanges with DOH’s counterparts in other states in which DOH officials stated that under ‘pressure from our Governor’s Office,’ they were trying to determine whether other bidders—at least one of whom ended up being a qualified bidder—were actually performing FI services in other states and were therefore qualified bidders,” the lawsuit notes.Several months later, aft...