54 transportation companies across the state were issued cease and desist notices from New York Attorney General Letitia James warning them of potential financial penalties and prison sentences if they continue their alleged illegal schemes of overcharging Medicaid for fraudulent services.
AG James alleges the companies use fake billing schemes to steal from Medicaid and exploit vulnerable patients. 15 of these companies also received demands for repayment of fraudulently obtained funds.
Medicaid reimburses authorized businesses for transporting Medicaid patients to and from covered medical services. A licensed taxi company enrolls with the state as an eligible provider and is then randomly assigned to provide trips to patients to specific, non-emergency, medical appointments. The companies must use licensed drivers and proper vehicles, and bill only for services rendered. They are allowed to bill Medicaid for a base rate for the trip, plus an amount for mileage and any tolls.
The companies’ schemes often involve billing Medicaid for fake trips, adding fake tolls to inflate costs, fraudulently extending the mileage of trips, and using unlicensed drivers. None of the companies served on Wednesday were identified by the Attorney General’s Office.
“Companies that illegally profit by exploiting Medicaid patients steal taxpayer money and undermine the health care system that all New Yorkers rely on,” said Attorney General James. “Today I am putting the entire medical transportation industry on notice to stop these schemes that take advantage of vulnerable New Yorkers and steal critical funds intended to provide health care to those in need. My office has already recovered millions of dollars and secured prison sentences for those committing this fraud. I will continue to do everything in my power to shut down these schemes and ensure that state funds meant to help New Yorkers in need are not stolen through fraud and corruption.”
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