NY recoups $551 million in Medicaid fraud

NEW YORK (Reuters) - New York state has recovered $551 million in Medicaid payments that were obtained through fraud and abuse, which equals about half of the entire amount that the federal government won back, Gov. David Paterson said in a statement on Friday.

New York has one of the nation’s most generous Medicaid programs, which pays for healthcare for the poor, disabled and elderly. The latest Department of Justice data show the Bush administration has only recouped a total of $1.1 billion in the U.S. fiscal year, the Democratic governor said.

The latest total for the federal government, which ended its fiscal year on September 30, falls short of the $1.5 billion it recovered last year and is only half of what it recovered in 2006, said Paterson.

New York’s tax revenues have fallen with Wall Street’s profits, leaving the state with a 15-month, $15 billion deficit and making it especially important to prevent Medicaid abuse.

“New York is leading the way in monitoring and identifying Medicaid fraud, waste and abuse — all the while maintaining the integrity of the program for those who truly need services,” said Paterson in a statement.

The federal government requires states to root out Medicaid abuses, and New York agreed to find $215 million of wrongdoing. Last year, all 50 states recovered a combined $305 million, the governor said.

Paterson singled out Medicaid and education for the biggest cuts in a $2 billion plan to shrink the deficit that was rejected by lame duck Senate Republicans last month.

Next week, the governor will unveil his first budget plan though a leadership feud among Senate Democrats, who won a two-seat majority in November, might delay action.

(Reporting by Joan Gralla; Editing by Kenneth Barry)

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