Governor Hockle’s plan to overhaul the fraud-ridden $9 billion Medicaid home care program, the system that allows New Yorkers to get paid to care for the elderly, is facing a lawsuit from “middleman” companies that act as payroll agents between Medicaid and caregivers.
During state budget negotiations earlier this year, the governor quietly pushed through a bill that would replace hundreds of financial intermediaries that make payments to caregivers under the popular Consumer Directed Personal Assistance Program (CDPAP) with a single company selected by the Department of Health.
Groups representing the “middleman” companies she wants to eliminate are now suing to block the proposal.
“These sweeping changes to an $8 billion-a-year program were quietly adopted in the final days of the state’s budget process without any public dialogue, discussion or debate, let alone input from stakeholders or program participants,” lawyers for Save the Consumer-Directed Home Care Program said in the lawsuit.
“This bill would force hundreds of New York businesses out of business, result in thousands of job losses, and result in significant disruptions to services or even remove consumers from home services entirely, forcing them into institutionalization,” the report continues.
Under CDPAP, New Yorkers can receive approximately $38,000 a year to care for a family member or close acquaintance.
Haukl’s proposal was floated as a way to ensure oversight and cut rapidly ballooning costs.
Spending on the program ballooned to more than $9 billion last year, according to the latest Department of Health data, and the program is set to serve about 250,000 New Yorkers by 2023, up from about 13,000 in 2015.
But the lawsuit argues that the changes specifically target financial intermediaries, violating their ability to conduct business under the state constitution, the U.S. constitution and federal Medicaid law.
The deal to replace hundreds of intermediaries with a single company is currently scheduled to be signed by October 1st.
Meanwhile, critics of the proposal argue that the process of selecting a new company is being rushed without transparency, including the usual explicit exclusion of the state auditor’s office from reviewing the new contract.
Opponents also complain that potential companies must meet very narrow criteria, such as having experience as a statewide fiscal intermediary in another state.
In a statement provided to The Post on Monday, Haukle’s office said the plan would result in more efficient use of taxpayer money.
“We are committed to protecting our home care patients, strengthening the CDPAP and ensuring the sustainability of the program,” the spokesperson said.
“Our reforms will advance that goal by ensuring taxpayer dollars effectively serve patients who need them.”
An attorney for Save Our Consumer Directed Home Care Program did not immediately respond to a request for comment. The group formed in June, according to New York State Department records.
Brian O’Malley, executive director of the New York State Consumer Personal Assistance Association, is not involved in the lawsuit, but the association has also strongly criticized Haukl’s proposal.
“Governor Hawkle is seeking to turn over to an out-of-state company a program that allows New Yorkers to receive critical care in the comfort of their own home,” O’Malley said in a statement Monday.
“This process has proven to be nothing more than an $8 billion backroom deal and needs to be stopped before people receiving services are forced into nursing homes,” he added.
