State Medicaid Program Integrity: Examining Fraud Risks and Oversight Deficiencies.

The subcommittee on oversight and investigations will now come to order. The chair now recognizes himself for five minutes for an opening statement. Good morning, and welcome to today's hearing titled " State Medicaid Program Integrity, Examining Fraud Risks and Oversight Deficiencies." Today's hearing will examine Medicaid program integrity in four states, Minnesota, California, New York, and Ohio. For the first time in years, state Medicaid directors are testifying before Congress to share what they are doing to address rampant fraud in government health care programs. Let me be clear, fraud is not isolated to these four states. As we have discussed in two previous hearings before this subcommittee, Medicaid fraud is a real problem. It happens in every single state, red and blue, and has been harming patients and draining taxpayer resources for decades. In Minnesota, a recent ninety million dollar Medicaid fraud takedown brought charges in autism therapy services, housing support, home health care, and personal care services. This was just the latest set of charges in ongoing fraud investigations In California, a man recently pleaded guilty to two hundred seventy million dollars in fraudulent prescription drug claims to Medicaid. Earlier this year, charges were filed against twenty-one suspects for defrauding Medicaid hospice benefits of two hundred sixty-seven million dollars. In New York, two hundred twenty-six million dollars in social adult daycare fraud has been charged in twenty-twenty-six just so far this year. Millions of dollars have been implicated in non-emergency medical transportation fraud schemes in recent years. In Ohio, a forty-two million dollar Medicaid fraud take-down implicated nine defendants in connection with therapeutic behavioral health services for children and young adults. Recently, there were also charges made in connection with hundreds of thousands of dollars In in-home service fraud, these fraud schemes harm patients. When services are billed but not rendered to vulnerable Medicaid recipients who are dependent each and every day on this support, the consequences can be severe. And unfortunately, sometimes those consequences can be fatal. Elderly and disabled patients in need of in-home care do not receive the help that they need to live the lives that they have with dignity. children who have benefited from essential therapies often don't receive them. Those who rely on transportation assistance to attend medical appointments miss the preventative care and treatments that they need to stay healthy. This morning's hearing is a culmination of months-long investigation led by this subcommittee into Medicaid fraud with the goal of strengthening the program integrity. After two hearings, letters to eleven states requesting documents and information and reviewing over ninety thousand pages of documents and information produced to this committee. It is clear that some states are not doing enough to safeguard the Medicaid program and gaps remain in program integrity requirements that are opening the door far too wide to fraud. Thankfully, fraud is finally getting the attention that it deserves. I commend this administration for surging resources to the war on fraud by forming a task force to eliminate fraud. Additionally, CMS and the Office of the Inspector General are leveraging their authorities to hold states accountable when they are not meeting the mark. We are seeing accountability for the first time in far too long. But more remains to be done. We can no longer tolerate criminals taking advantage of the Medicaid system. Fraud is not and should not be the cost of doing business. It is preventable and we have a duty to help rein it in. It is no longer sufficient to do the bare minimum. States must rise to the occasion and tackle fraud head-on. Our Medicaid program and the patients that rely on that to be healthy each and every day of their lives, they depend on it. I want to thank all of our witnesses for being here today. We look forward to hearing from you and learning more about the steps that your state is currently taking to address Medicaid fraud. With that, I now recognize our ranking member of the subcommittee, Ms. Clark, for her opening statement.

Thank you very much, Mister Chairman, and I'm glad to have another opportunity in the subcommittee to discuss the partisan actions that the Trump administration has taken against state Medicaid programs under the guise of fighting fraud. Democrats have been raising concerns about CMS's threats of funding cuts to blue states, which are destabilizing programs and risk further cuts to healthcare in states led by Democratic governors, leaders who President Trump sees as political enemies. The administration's partisan motivations are clear. In January, amidst terror and chaos in Minnesota, caused by the Trump administration, CMS announced it would withhold up to two billion dollars from fourteen of Minnesota's health care services. Days later, on the heels of the killing of an innocent American citizen by ICE agents, President Trump threatened Minnesota with a quote " day of reckoning and retribution" unquote. When CMS Deputy Administrator Brandt testified before this subcommittee in March, I asked her when a hearing would be scheduled on CMS's decision to withhold more than five hundred million in quarterly Medicaid funding from Minnesota. She said that CMS had been stayed from scheduling a hearing, which proved to be entirely false. When we asked for correction or clarification of her false testimony, Deputy Administrator Brandt did not provide one. We cannot conduct oversight if CMS is going to lie about its actions. CMS has also deferred three hundred and fifty million in Medicaid funding for Minnesota for two consecutive quarters in sweeping cuts to entire service categories but has not provided Minnesota with a meaningful or consistent guidance on how to address CMS's concerns. In California, CMS has put one point three billion in Medicaid funding in jeopardy through a deferral. for home health care service payments. CMS Administrator Oz proudly announced that this was the largest deferral ever by the agency. He fails to acknowledge the impact that these over broad indiscriminate actions will have. And he has refused to accept California's explanations for the growth in those services which are due to long-standing efforts by the federal government and states to keep patients out of institutions and in their homes and in communities. The need for home health care does not disappear when funding is suspended. The and California patients are terrified of losing care at home and being forced into institutions. CMS has also threatened my state, New York. When it began investigating New York program New York's program, it touted clumsy and entirely inaccurate math which ultimately overstated the number of New Yorkers receiving home health care services by near e- nearly eleven times. Even though CMS admitted its error, the Trump administration has not let up on its threat to rob New Yorkers of Medicaid for their health care. We have also heard that the way CMS treats state officials in some blue states has completely changed. CMS seems to be looking for reasons to cut funding to certain states rather than ways to preserve it. Administrator Oz and Vice President Vance have held numerous press conferences to hastily to announce hastily determined funding cuts that harm patient h- patient access to health care. They have clearly prioritized headlines over health care and partisanship over people. The administration has repeatedly treated blue states as enemies rather than partners. HHS Inspector General March Bell has also joined this campaign against blue states by decertifying Hawaii's Medicaid Fraud Control Unit cutting three million dollars from for the entity that is responsible for finding and prosecuting Medicaid Medicaid fraud and patient abuse or neglect. This is particularly ironic as just the other day, the Department of Justice touted numerous arrests and charges for health care fraud, and buried in the DOJ pr- press release is a shout-out to the Medicaid Fraud Control Unit of Hawaii as one of the many agencies responsible for prosecuting the cases in the crackdown. One day, they're being denied recertification. The next day, they're part of a major operation that the administration wants all the credit for. Which is it? The answer is that this administration will do anything to cover up for the massive Republican cuts to health care. Enrollment and Medicaid and the Affordable Care Act are dropping precipitously, more than five million people just over the past year. CMS and states should work together to address fraud, just as they always have. getting actual fraud out of the programs and hold actual fraudsters accountable. But wagging a politically motivated assault aga- w- excuse me, waging a politically motivated assault against the sick, the disabled, the blue states, and taking health care away from millions of Americans is not fighting fraud. That's just using fraud as a convenient excuse to carry out the president's harmful agenda. with the most vulnerable individuals in our country paying the price. With that, Mister Chairman, I yield back.

Thank you. The chair now recognizes the chairman of the full committee, Mister Guthrie, for five minutes for an opening statement.

Tha- thank you, Mister Chairman. I thank uh you for holding this important hearing. I wanna thank all of our witnesses for being here. I know some uh came in in challenging uh situations and we really appreciate you being here today. Uh, this hearing is about accountability and what all of us can do moving forward to strengthen the Medicaid program integrity. We have a duty to do everything possible to protect the Medicaid program for fraud

Yes.

And the Medicaid program. and preserve it from those who need it most. Each state administers its Medicaid program and is responsible for These may making sure that fraud prevention and enforcement mechanisms are effective. Unfortunately, this is not always the case. Fraud is not a victimless crime. Not only does it squander taxpayer dollars, but it harms vulnerable patients. For obsters are blatantly lining their pockets with taxpayer dollars, often at the expense of the elderly, the disabled, and young patients that are receiving substandard or no medical care. Americans are tired of seeing their hard-earned tax money end up in the hands of criminals. So we can't deny this is happening. It's a it's amazing that it just seems like this is happening. We have a California man, Paul Randall, who pleaded guilty to two hundred and seventy million dollars in Medicaid fraud. So instead of going to help the most vulnerable and the disabled, where did the money go? He bought luxury cars, rare sports memorabilia, including Mickey Mantle rookie baseball cards and game worn sneakers by Kobe Bryant. These are facts. This isn't something that's just that that came from this administration. These are facts in law. Similarly in Ohio. Law enforcement recently seized fourteen luxury vehicles owned by defendants in a thirty million dollar Medicaid or Medicaid behavioral health case fraud. Just this week, the Department of Justice announced two in twenty twenty-six national healthcare fraud take-down which charged four hundred and fifty-five defendants with over six point five billion in healthcare fraud. This take-down was a collaborative effort between federal, state, and international partners, include fraud schemes in Medicare and Medicaid. This is another example of how big this problem is. Through more rigorous oversight and enforcement, we can stop these brazen criminal s- criminal schemes and make the Medicaid program stronger and ensure its stability for the future. So my my friend from New York commented on and brought up that that the administration just ceased payments and said because you have fraud you're ceasing payments on all these other programs. Well, let me just tell you what happened with that. We had over four hundred four hundred home health providers, so we do want them out of the nursing homes and in the in their home, four hundred, over four hundred, home health care providers providing services in LA County. They knew there was rampant fraud and they couldn't figure out which ones were legit which weren't. So let's just suspend payments. So if you performed a service, your payment was suspended. If you were cheating, your payment was suspended. Those who, twelve companies out of over four hundred called and said, " Where's the money for the, what we served?" Twelve legitimate companies out of over four hundred in LA County. So it's not the administration that was just represented here saying that we're just gonna hold, we're gonna hold blue states uh, we're gonna, we're gonna punish blue states because they're blue states. What is this administration making a decision that we have rampant fraud, it's ripping off the taxpayers, It's, it's, it's cheating the most vulnerable, some who are in the audience today, the elderly, the disabled, and those who need Medicare, the Medicare and Medicaid the most. And so they're using the tools available. And I will tell you the twelve people who, twelve companies who legitimately performed those services did get paid. And the other four hundred who were cheating never got their money because they didn't do the services. And so I will defend that. I thank your taxpayer dollars. The most vulnerables need to, the most vulnerables need to be defended as well. I will defend that. And we look forward today to kind of frame this debate to understand what has happened, how we're gonna deal with it, and how we make sure that the American people who are generous with their tax dollars as we had some debates on Medicaid talked to a lot of people about Medicaid. The American people want this program to work. They want the most vulnerable to be taken care of. But they also wanna know that people care about their money as well. And so that's what this hearing's about. That's what we're gonna fight for on our side of the aisle. If you're cheating this system, we're gonna come after you. And we're gonna make sure if if you're the m- and the most vulnerable, you're gonna be taken care of. And that's our task, and I will yield back.

The gentleman yields. The chair now recognizes the ranking member of the full committee, Mister Pallone, for five minutes for an opening statement.

Thank you, Mister Chairman. Nearly a year ago, that included the largest health care cuts in American history. Republicans cut health care by a trillion dollars, which is expected to rip health care away from fifteen million Americans. According to a recent study, five million Americans have already lost their health insurance as a result of these cuts, and unfortunately this is just the beginning. During the mark-up of the big ugly bill, committee Republicans repeatedly insisted that the cuts wouldn't hurt patients and would only affect waste, fraud and abuse in the program. But that has proven to be completely false, and they knew that. You cannot cut health care by a trillion dollars and not impact millions of people's health care. Earlier this month, the Trump administration released a rule showing just how burdensome and cruel the new requirements to receive care through Medicaid would be. That rule includes a provision that those receiving ongoing treatment for cancer could lose their Medicaid coverage if they don't jump through all the hoops and red tape that Republicans put in their way. Even cancer patients are under attack by Republican cuts to their health care. The Republicans' big ugly bill was never going to strengthen Medicaid as they claimed. It was just another step in the Republican campaign to dismantle it. And now as Republicans try to figure out a way to pay for President's Trump Trump's reckless war of choice with Iran, through another partisan reconciliation bill, they're reportedly considering even more cuts to Medicaid. More than seventy million Americans who are disabled or chronically ill, elderly, or children, rely on Medicaid. The Trump administration and Republicans in Congress continue to find ways to endanger or take away that care. They've decided that if they simply say they're eliminating fraud in Medicaid, then they can get away with eliminating Medicaid. Well, they're wrong. We're not standing for that. The attacks on health care don't stop with the big ugly bill. Department of Justice just ripped up decades' worth of guidance and precedent that helped keep those with disabilities out of institutions. And the Centers for Medicare and Medicaid Services has selectively abandoned its practice of working in partnership with states to administer the Medicaid program. It's becoming increasingly clear that under Doctor Oz, CMS does not intend to work with states in good faith, particularly states that do not vote or did not vote for President Trump. In California, for example, CMS has deferred one point three point four billion dollars in quarterly payments to the state mostly for home and community-based services, solely based on how quickly the program has grown. If the goal was finding fraud, CMS would identify specific concerning charges and work with the state to resolve them. It would not threaten to defer payments to all in-home supportive services for an entire quarter, and then have the Vice President hold a celebratory press conference. CMS continues to hold hostage funding to Minnesota, repeatedly making demands of that state with short deadlines only to move the goal posts when the state meets them. And CMS sent a letter to New York making outlandish allegations about that state's program accompanied by bombastic social media posts from doctor oz claiming that i quote nearly three fourths of the state's six point eight million medicaid enrollees receive personal care services but doctor oz and cms had to walk back those claims after it was pointed out that they had committed obvious errors in math that grossly inflated the number of enrollees receiving those services now i'd say if republicans are really interested in looking into waste fraud and abuse they should look no further than the actions of the Trump administration and the president. It, I mean, talk about rip-off, the American taxpayers are ripped off every day by Trump's policies and personal, you know, effort to try to make a profit for him and his family. Why don't you go after them? Why don't you go after the administration? But it's outrageous to watch the Trump administration going after state Medicaid programs while it's engaged in reckless war of choice that is costing the American people a hundred and thirty-two billion dollars, tanking the economy and fueling inflation that the president says he loves, he loves inflation. Republicans also had no problem supporting a one point eight billion dollar slush fund to reward Trump's friends an insurrectionist, who assaulted police officers on January sixth. You think that's not a waste of money? Huge waste of money. The combination of the Republicans' big ugly bill and the politically motivated cuts by CMS put states in an impossible situation. and patients are already paying the price. Playing politics with Americans' health care is cruel and dangerous. Unfortunately, that is what we're repeatedly seeing from Republicans here in Washington. And with that, Mister Chairman, I yield back the balance of my time.

The gentleman yields. That concludes members' opening statements. The chair would like to remind members that pursuant to the committee roles, all members' written s- opening statements will be made part of the record. We want to again thank our witnesses for being here today. taking time to testify before the subcommittee. You will have the opportunity to give an opening statement, followed by a round of questions from members. Today's witnesses are Mr. John Connolly, Temporary Commissioner and State Medicaid Director, Minnesota Department of Human Services. Mr. Tyler Sadworth, State Medicaid Director for the California Department of Healthcare Services. Mr. Amir Bussoiri, State Medicaid Director of New York State Department of Health. and Mister Scott Partica, Director of Ohio Department of Medicaid. We appreciate all of you being here today, and I look forward to hearing from each of you. You are aware that the committee is holding an oversight hearing, and when doing so, has the practice of taking the testimony under oath. Do you have an objection to testifying under oath? Seeing no objection, we will proceed. The chair advises that you are entitled to be advised by counsel pursuant to House roles. Do you desire to be advised by counsel during your testimony today? Seeing none, please rise. Please raise your right hand. Do you promise to tell the truth, the whole truth, and nothing but the truth, so help you God. Seeing the witnesses answered all in the affirmative, you are now sworn in and under oath, subject to the penalty set forth in title eighteen, section ten O one of the United States Code. With that, I will now recognize, please be seated. With that, I will now recognize Mr. John Connolly for five minutes to give your opening statement.

Thank you, Chairman Joyce, Ranking Member Clark, and members of the subcommittee. Thank you for the opportunity to be here today, first of all, and for your continued focus on the important issue of Medicaid integrity. The programs we administer at Minnesota's Department of Human Services are essential to the health, stability and economic security of communities across Minnesota. They help children, families, seniors, and people with disabilities access health care and other essential services every day. These programs are lifelines, relied upon by over a million Minnesotans in communities large and small. As is the case with government-funded programs throughout the country, and in fact across all health care payers, including private insurance, bad actors have tried to take advantage of our well-intended services. But let me be clear. The Minnesota Department of Human Services and Minnesota government have a zero tolerance policy for any fraud within our government programs. We take attempts to undermine the integrity of these programs very seriously. We are taking aggressive measures to secure our Medicaid programs, and here are just a few recent examples. Minnesota DHS has conducted over four thousand investigations and and and identified more than fifty million in in recoveries since twenty twenty, resulting in over one thousand one hundred and fifty cases referred to law enforcement, state and federal. Last year we hired a new Inspector General with a decade-long record of prosecuting Medicaid fraud and we have also increased his staff to enhance oversight and accountability we have ex- uh expanded our prepayment review protocols to grow our capability to block payments to fraudulent providers on the front-end rather than paying them out and trying to recover those funds later we have aggressively moved to stop payments to providers upon credible uh evidence of fraud We designated fourteen Medicaid benefits as high risk, determining that these benefits warranted heightened levels of scrutiny, and controls under Medicaid's regulatory framework. Ultimately, we took decisive action to terminate one of those benefits, and to impose licensing for service providers in another. We recently completed a five-month comprehensive review of almost five thousand six hundred high risk Medicaid providers to ensure they meet rigorous eligibility and compliance standards. In appropriate cases, we issued disenrollment notices and stopped payments. We've been doing this work since long before the recent headlines, and we will continue doing it every day. There is no finish line when it comes to protecting the integrity of our programs. Importantly, however, our work is always done with beneficiaries and the broader public in mind. We strive to enhance program integrity while also providing access to care and continuity of service. So, for example, when we disenroll providers, we work closely with counties and in some cases reach out directly to affected Minnesotans to help beneficiaries connect with alternative providers and resources. In pursuing these dual objectives of program integrity and responsible delivery of services, we welcome opportunities for dialogue with Congress, the Centers for Medicare and Medicaid Services, and our fellow States. We all have valuable lessons to learn from each other. We all know that our decisions, as well as those of our federal and state partners, have real-world impacts. Medicaid in Minnesota serves approximately one point one six million people. Again, children, families, seniors, people with disabilities, those with serious mental health needs, and others who depend on care to remain safe and stable in their homes and communities. Moreover, Medicaid is a foundation for our entire health care delivery system, including hospitals and nursing nursing facilities. And major funding losses threaten to destabilize care for all Minnesotans. Recent federal deferrals of Medicaid payments to Minnesota This is not an accounting dispute on a spreadsheet. These decisions affect Minnesotans with significant needs. People for whom a missed appointment, a gap in treatment, or an interrupted support service can quickly become a crisis. This is not an either-or decision. We can protect program integrity while still operating these programs effectively. We can root out fra- fraud, waste, and abuse while still caring for those in need. And we can protect taxpayer dollars. while simultaneously directing them to their intended beneficiaries. It is our job that we share with our federal partners. I believe strongly in public service and am proud of the work Minnesota DHS has done to strengthen program integrity combat fraud and ensure that we continue to secure the federal funding that is crucial to our programs and to Minnesotans I welcome and encourage continued dialogue with you all as we continue these efforts. Thank you again for the opportunity to share the work we're doing in Minnesota to protect Medicaid program integrity. I look forward to your questions.

Thank you. The chair now recognizes Mister Sadwith for five minutes for an opening statement.

Chairman Joyce, Ranking Member Clark, and members of the subcommittee, thank you for the opportunity to testify. My name is Tyler Sadwith, and I am the Medicaid Director for California, a position in the California Department of Health Care Services. I wanna be clear from the start. We take program integrity seriously and work hard every day to protect california's medicaid program from fraud so taxpayer dollars can go to healthcare services for eligible patients who need them i would like to touch on three areas first i wanna highlight california's program and the people we serve second i'd like to demonstrate our unwavering commitment to combating fraud waste and abuse finally i wanna emphasize our valuable partnership with the federal government and make very clear our ongoing commitment to collaborating with our federal partners at cms the signers for medicare and medicaid services. medical is california's medicaid program. it provides healthcare services to approximately fourteen million vulnerable americans, including pregnant women seniors children and people with disabilities. california is the country's most populous state. it is the fourth largest economy in the world. this means we support more healthcare services for more vulnerable individuals. than any other state Medicaid program in the country. This is a responsibility we take seriously, and it is a vital part of our mission to protect this program. California is wholly committed to combating fraud, safeguarding taxpayer dollars, and holding bad actors accountable. To meet these commitments, the department prioritizes program integrity at all stages, from provider screening and eligibility determinations, to claims processing, to back-end analysis and investigations. Approximately twenty percent of staff are dedicated exclusively to program integrity. We have strong policies and protocols that are designed to prevent identify and block fraud, waste, and abuse. Our comprehensive oversight oversight strategy includes robust provider vetting that exceeds federal standards, provider suspensions, including approximately five thousand over the past five years, and secured fraud recovery totaling more than one billion dollars over the past five years. California is one of only two uh Medic- two states with a Medicaid agency that employs armed sworn peace officers with the legal authority to execute search and seizure warrants. Our teams of auditors, investigators, clinicians, and data scientists conduct top to bottom reviews of providers. Our strong partnerships with district attorneys, Medicaid fraud control units, and federal law enforcement and investigators are critical to our success. But we must remain vigilant because we know bad actors seek to Medicaid, Medicare, and private health insurance. That is why we continue to strengthen our program in higher risk areas, such as hospice care. We are implementing new safeguards to ensure appropriate use of services, such as applied behavioral analysis and transportation. We're proud of our program, but I want to emphasize the importance our partnership with CMS plays in ensuring Medi-Cal operates with accountability, transparency, and in compliance with federal requirements. We value that partnership and our shared commitment to protecting taxpayer dollars and maintaining public confidence in Medicaid. A productive relationship with CMS is a key ingredient for continued success. And CMS recognizes California as a national program integrity leader. Across bipartisan administrations, CMS's Medicaid Integrity Institute and the National Association for Medicaid Program Integrity have highlighted our advanced data analytics and investigative strategies. California's program integrity leader recently served on the executive board of the Healthcare Fraud Prevention Partnership, a CMS convened body working across public and private sector to fight fraud. We will be most successful in keeping bad actors out of the program if we continue working closely with CMS and other federal partners. I know this from my own experience at CMS, where I served seven years across bipartisan lines. The vast majority of Medi-Cal providers follow the rules. Rooting out unscrupulous providers is critical to safeguarding taxpayer dollars and ensuring Medi-Cal can fulfill its mission to serve the children, pregnant women, and other other vulnerable Californians who rely on it. I assure you, California is committed to this important work and unwavering in our efforts to combat fraud. Thank you, and I look forward to your questions.

Thank you. The chair will now recognize Mister Basiri. for five minutes to give an opening statement.

Chairman Guthrie, Ranking Member Pallone, Subcommittee Chairman Joyce, Ranking Member Clark, and members of the subcommittee. Thank you for the opportunity to testify today regarding New York, New York's Medicaid program and our efforts to combat fraud waste and abuse. My name is Amir Basiri. I'm Deputy Commissioner and the Medicaid Director at the Office of Health Insurance programs at the department the New York State Department of Health. I've devoted my career in public service service to helping ensure that government programs are effective accountable and worthy of the trust that the taxpayers put in place in them I enter this role with a clear responsibility to do what is in the best interest of New York's Medicaid program, including the safeguarding of taxpayer resources, with strong oversight and program integrity so that services are maintained for those who need them the most. New York's Medicaid program is one of the largest in the country, serving more than six point four million residents, including over two million children, approximately a hundred thousand pregnant women, and one point five million age blind and disabled residents. Given the magnitude and overall scope of our program, we work every day with state and federal partners, law enforcement, and oversight entities to prevent, detect, and address fraud, waste, and abuse. We also engage regularly with the Center for Medicare and Medicaid Services on program integrity matters. And we sincerely value that partnership as a critical component of our ability to strengthen program integrity efforts. The state recognizes the importance of technology and has made a considerable number of investments in modernizing key technology to both support the consumer and provider experience, as well as improving data interoperability and accountability across the delivery system. New York's approach to program integrity relies on multiple state agencies working in close coordination. This provides complementary points of accountability and redundancy in responsibilities to ensure no single point of failure. This structure creates several layers of accountability, including provider monitoring and screening to audits investigations and coordinated enforcement actions. This approach has produced measurable results. The state continuously enhances its efforts to prevent and detect fraud waste and abuse, And in twenty twenty four, the Office of the Medicaid Inspector General completed more than twenty five hundred audits and investigations, referred over four hundred and fifty matters for criminal prosecution, and generated approximately four billion dollars in recoveries. These outcomes reflect years of sustained work across agencies to identify improper activity, recover funds, and hold bad actors accountable. We are proud of these results, but we also recognize that a program of this size and complexity requires constant vigilance and continuous improvement. Under Governor Hochul's leadership, New York has pioneered a myriad of reforms in high-risk areas to safeguard taxpayer resources. This is most evidenced by the state's right-sizing of the consumer-directed personal assistance program, a program that allows Medicaid members to hire uh their own caregivers by transitioning from a system of over six hundred fiscal intermediaries to one single statewide fiscal intermediary thereby reducing administrative cost in the program while establishing a stronger and more consistent overnight mechanism with full accountability. In addition, a result of enhanced screening and oversight of the non-emergency medical program was done through the creation of a statewide transportation broker. Nearly eight hundred providers were terminated or rejected from the network as a result of this transition to the broker, uh mitigating opportunities for improper billing while preserving access to this critical service. I am proud of the work we've done to protect both the integrity of the Medicaid program and the millions of New Yorkers that depend on it. Protecting the integrity of Medicaid requires collaboration, transparency, and a shared commitment to fiscal stewardship of taxpayer dollars. We deeply value our partnership with federal agencies on this effort, and I appreciate the test- the opportunity to testify today, uh, and am prepared to answer the subcommittee's questions.

Thank you. The chair now recognizes Mister Partica for five minutes for an opening statement.

Apologies. And members of the subcommittee on oversight investigation, my name is Scott Partica and honored to serve as the director of Ohio Medicaid. I represent all of Ohio Medicaid team who wake up each and every day with a passion to serve those in need, support our providers, especially our direct caregivers, and execute the program at the highest level of program integrity each and every day. Since joining the department in November of twenty twenty five, I found myself laser focused on program integrity to secure this vital program. Addressing fraud, waste, and abuse within Ohio Medicaid program has always been a focus of the Dwyane administration. And our work has especially sharpened and expanded response to recent program trends noticed in Ohio. And our work is far from over. Ohio has implemented a sis series of system reforms over the last five years to add operational efficiencies through administrative consolidation new advanced IT infrastructure, and the results of that are growing transparency and additional tools for accountability that are just now beginning to bear fruit. Key program concerns of previous years include payment accuracy, member eligibility, and concurrent enrollment in other states, as well as broader program spending in certain areas. Ohio has taken steps, each concern head-on, including reducing the perm finding to two percent, adding new supports for county caseworkers to increase accuracy and efficiency of applications and increasing data transparency along the way, that has helped guide policy making for the administration in Ohio legislature. Other ongoing initiatives include rule and policy updates, enhanced provider screenings, new UM practices, and targeted provider audits. These and other activities have helped us address concerns highlighted by state partners and partners at CMS. When looking at federal initiatives to combat program integrity concerns, it's important to recognize the working family's tax cut legislation, which dramatically increased the level of program oversight and elevated program integrity priorities in state Medicaid r- programs, including addressing concurrent enrollment across states, ensuring deceased individuals are no longer on the rolls, increased emphasis of audits and subsequent corrective action, increased frequency of eligibility determination, mandating community engagement requirements, help facilitate people moving up and off the program. These efforts are helpful and we believe our federal partners can and should continue to improve protection and oversight of state programs. Now to Ohio. Troubling data in home health space was uncovered at Ohio late last year. We began investigating the information in conjunction with Ohio Auditor Keith Faber and former Attorney General Dave Yelch shortly thereafter. The result culminated in new actions and initiatives to address areas of weakness combat the fraudsters' attempt at exploiting these critical programs. In recent weeks, Governor DeWine announced several new initiatives aimed at curbing that trend. A six month moratorium on new home health providers, increased frequency of provider revalidations, new rules to conduct provider payment suspensions during periods of investigations and updating Ohio's electronic visit verification rules. Additionally, the Ohio legislature passed Senate Bill three fifteen, which includes a myriad of reforms to the integrity of the Ohio Medicaid program. including increased penalties for fraud violations, expanded oversight of provider ownership structures, enhanced provider enrollment requirements, and expanded use of electronic visit verification. Work to strengthen other high-risk programs is also underway. It is a full press forward to address fraud, waste, and abuse through a thorough policy review across the agency. Through these efforts, we have identified certain areas, such as Ohio's nursing facility ventilator program for improvements, private room compliance monitorings, oversight of certain behavioral health services, home health, and skin substitute coverage are just a few where we are making policy updates. Moving forward, one area we belie believe the federal government and states could partner is through improved data sharing and tracking of provider ownership and affiliation across state lines and programs. As we continue our program integrity work, it is critical that we are able to systematically root out bad actors and not leave the door open for any exploitation of this program. If somebody is taking advantage of our program in Northwest Ohio, I certainly want to ensure our partners across the state lines in Michigan are aware of that as well. The department is committed to ensuring Ohioans receive health care in accordance with the law and rooting out fraud, waste, and abuse to protect this vital and critical program to the people who need it. Chairman Joyce, Vice Chair Balderson, Reiki Member Clark, and members of the committee, thank you for having me today. I look forward to your questions and continued work moving forward. Thank you.

I thank you all for your testimony. We will now move to questioning. And I will begin and recognize myself for five minutes. The rest of you are sad with. California has a large Medicaid program, spending more than four point seven billion dollars in twenty twenty five on home and community-based services alone. Fraud in these services, as you would recognize, is a serious matter. In some cases across the country, Patients have died when fraudsters bill Medicaid for services that were needed but never provided. Your office has stated in correspondence with this committee and CMS that California goes beyond federal requirements for providing screening and enrollment. If that is the case, why has your Medicaid agency classified all Medicaid-only providers as limited risk? a classification that comes with less stringent oversight standards. Do all of California's Medicaid providers being considered as limited risk, really reflect what you are seeing in these programs?

Thank you, Chairman, for the question, and thank you again for the opportunity to be here today. Um, home and community-based services are a vital program in California. Um, we know for example that um they're they're uh cost effective, reflecting a prudent use of taxpayer dollars, one year of receiving in-home supportive services um saves federal and state taxpayer dollars approximately hundred thousand dollars compared to a stay in a nursing facility and we are absolutely committed to ensuring the integrity of these vital services.

But by classifying all Medicaid-only programs as limited risk, are you seeing that all of these programs really show the limited risk as far as fraud goes?

Thank you for the question. Um, so the um risk classification, categorical risk level classification is one of many tools that we use to assess program risk.

Is this adequate? When you pu when you paint with one brush all of those as limited risk, which requires less oversight, are you missing fraud?

We employ a number of safeguards to prevent bad actors from entering the program for in-home supportive services specifically. we do conduct fingerprint and criminal background checks, which is one of the features of a high risk categorical level designation. So even though it

But is that, that's a high risk, but we're talking about limited risk, which you ascribed to all Medicaid only providers. Does that catch all the fraudsters or should this be more of an individualized approach and not painting just with one brush? Is there an opportunity to really read, to weed out the fraud at its beginning stages?

I absolutely share your focus on

Have you previously designated any Medicaid-only provider types that were classified as moderate or high risk?

To my knowledge, um, we have not classified any Medicaid-only provider types. Um, we have, uh, gone above and beyond historically the federally designated risk levels.

In California, are you reassessing any provider risk designations in the state?

Thank you. We are actively assessing opportunities to strengthen program integrity in key areas. Um, this includes but is not limited to, um, the categorical risk level designation. Um, we do have other tools that we use to go after higher risk areas. We have, uh, developed, um, provider risk profilers, um, for services, um, s- you know, such as hospice care, such as dental care, um, and other other areas that are on our radar. that we use you know in conjunction with you know comprehensive

Okay, Shil, you brought you brought into this conversation now home health and hospices. Am I correct that California licensed home health and hospices before they can operate in the state?

Thank you for the question. Um this is an really important issue that I'm happy to talk about. Um it's really important.

Please do.

Yeah, the partnership between the State of California and the federal government is paramount to making sure bad actors stay out of the program when it comes to hospice care and home health. Um, just as context, Medicare, the federal program, is the primary payer for hospice care in California. The State Department uh, California Department of Public Health, my sister state agency, does perform licensure for hospice providers. And the state has acted swiftly to root out bad actors.

So before they can operate in California, this is just a simple yes, no. Do you allow this hospice organization to operate with or or without a a California license? Is that required before they can operate in California? Yes or no?

The Californian Department of Public Health has imposed a licensure moratorium that was enacted in twenty twenty one and just this week implemented new regulations, strengthening the standards for licensure for providers to be able to obtain a hospital's license.

So prior to just this week, your words. you could operate a hospice in California without a license. Is that what you just said to me?

Pardon me, I um respectfully disagree with the framing. I'm actually not um an expert on that specific issue.

Okay, so let's let's move on. Director Basiri. Personal care and home health age are the largest and fastest growing job category in New York and according to CMS accounted for more than forty-four billion dollars in total payments between twenty twenty-three and twenty twenty-five. I understand based on information that New York provided to the committee just yesterday, even though it was requested in March, that New York State Department of Health is in the process of designating wavered personal care services as a high-risk program. Given that CDPAP, which is a self-directed personal care service waiver program, is provided in home, private homes with minimal oversight, what safeguards currently exist to verify the services are billed actually and delivered.

Thank you for the question, Chairman.

I'm gonna ask you, my time has expired. I'm gonna ask you to respond to that in writing. Uh, and with that, I will yield to the ranking member for her five mem- minutes of questioning.

Thank you very much, Mr. Chairman. Under the partisan leadership of Donald Trump and Doctor Oz, CMS's use of its authority to withhold and defer Medicaid funding for Minnesota and California is extreme and unprecedented. And the CMS threat against New York, based on basic math errors, are an embarrassment. Under the leadership of Administrator Oz, CMS no longer supports all states in administering their Medicaid programs. Instead, it seems to be looking for ways to undermine these programs. CMS is demanding that states solve problems in their Medicaid programs without defining what the problems are. Or in the case of New York, CMS has based its scrutiny of Medicaid's on an embarrassing misinterpretation of its own data. Mister Bassieri, Doctor Oz sent you a letter on March third that stated that nearly three out of every four Medicaid beneficiaries received personal care services from twenty twenty three through part of twenty twenty five Doctor Oz posted that letter on social media along with a media a video threatening New York's Medicaid funding. Mister Bassieri, was the statement that Doctor Oz made about the number of Medicaid beneficiaries receiving personal care services accurate.