Corporate Compliance

New York state and New York City to pay record False Claims settlement

Compliance Monitor, July 29, 2009

New York state and New York City will pay the federal government $540 million to settle allegations they both submitted false claims for school-based healthcare services (e.g., speech therapy and transportation), provided to Medicaid eligible children from 1990 to 2001, according to a Department of Justice (DOJ) release.
 
New York developed the School Supportive Health Services Program and Preschool Supportive Health Services Program in the early 1990s to help local school districts, counties, and other schools get Medicaid reimbursement for covered services provided to children with disabilities.
 
New York state and New York City allegedly submitted claims without the proper documentation in an attempt to get the federal government to pay a larger share of the costs. The DOJ also alleged that New York state did not properly inform school districts and counties about requirements for Medicaid reimbursement.
 
A speech therapist who provided services to preschool children in upstate New York blew the whistle on the fraudulent activity through the False Claims Act’s qui tam provision. The whistleblower will receive $10 million for her help.

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