A federal audit revealed that New York State improperly made $7.6 million in Medicaid payments on behalf of incarcerated individuals. This issue arose due to failure in properly dis-enrolling individuals from Medicaid managed care after they entered state prisons.
The audit, conducted by the U.S. Department of Health and Human Services Office of Inspector General, found that payments were made for 1,375 people from January 2021 to December 2024, even while they were incarcerated.
Of the total amount, $6.1 million was the federal share, prompting a recommendation for New York to return the funds to the federal government.
The report cited that New York did not always stop payments after receiving notifications about incarcerations.
An example provided showed an individual remained enrolled for 23 months while in prison.
New York has systems to track Medicaid recipients who are incarcerated, but these systems failed to ensure proper matches between incarceration and Medicaid records due to various issues, including system limitations and manual overrides during the COVID-19 pandemic.
Discrepancies in personal information, such as names and birth dates, hindered the matching process.
The audit did not assess whether the incarcerated individuals received any medical treatment.
New York officials indicated plans to enhance their methods for identifying and removing incarcerated individuals from Medicaid enrollment.
The audit highlights significant flaws in New York's Medicaid processes for managing payments for incarcerated individuals and emphasizes the need for improvements in data matching to prevent future overpayments.
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