When it comes to policing New York’s sprawling Medicaid program, Attorney General Letitia James has some explaining to do.
As AG, James runs the state’s Medicaid Fraud Control Unit, which is charged with prosecuting those who rip off the taxpayer-funded program or neglect and abuse its vulnerable patients.
It ought to be a busy place, considering New York spends far more per capita on Medicaid than any other state.
Yet on her watch the unit has been posting metrics that range from lackluster to surprisingly low, especially when measured against the scale of a $119 billion social program.
James’ record in this high-stakes area now faces scrutiny from two directions: an audit of MFCU performance by the Trump administration, and sharp, well-informed attacks by her Republican challenger, Saritha Komatireddy.
As a two-term incumbent Democrat in a thoroughly blue state, James might get away with ducking her political opponent’s questions.
But she can’t evade the review recently ordered by the inspector general of the US Department of Health and Human Services, T. March Bell — not, at least, without putting federal aid in jeopardy.
“Noncompliance with your MFCU obligations can take your State’s entire Medicaid program out of compliance,” Bell warned in a May 13 letter to attorneys general nationwide.
“This means your failure to do your job as head of the MFCU has put all of your State’s Medicaid funds in jeopardy.”
One way or another, James will have to defend — or at least explain — the underwhelming performance of her anti-fraud unit, and that should be interesting to watch.
Federal statistics over the past five years show that New York’s MFCU logged almost 3,000 investigations for fraud, abuse and neglect, which was the sixth-highest number in the country.
That doesn’t sound so bad until you consider that New York’s Medicaid budget is the second-highest in the country.
In terms of investigations per billion spent, New York’s unit ranked 48th out of the 50 states.
It was 49th in indictments per billion and 50th — dead last — in convictions per billion.
Another troubling sign, as Komatireddy has pointed out, is that fraud enforcement seems to have trended sharply downward on James’ watch.
Since she became attorney general in 2019, the number of annual fraud investigations has dropped 45%, federal data indicate; the national total also declined during those years, but by about a third as much.
According to James’ self-reported “annual reviews,” Medicaid recoveries by her office went from $168 million in 2019, her first year on the job, to just $31 million in 2024.
It seems that fraud enforcement is the only thing about New York’s Medicaid program that’s shrinking rather than soaring.
Responding to a separate federal inquiry, the governor’s office recently declared that “New York has one of the largest MFCUs in the United States in terms of both staffing levels and total recoveries.”
What that claim neglected to mention, again, is that New York also has one of largest Medicaid budgets, second only to California’s.
So the fact that New York also has the second-largest MFCU staff was no big surprise.
And the fact that its gross recoveries ranked fifth — behind much smaller states such as Indiana and Massachusetts — was not much to brag about.
What accounts for these seemingly poor statistics? One possible explanation is the series of labor-intensive lawsuits that James’ office has lodged against nursing homes.
These eye-opening cases accused operators of improperly siphoning away Medicaid dollars that should have been spent on patient care, which allegedly resulted in disturbing levels of neglect and abuse.
But they have yet to trigger much in the way of a crackdown from either the state Health Department or Legislature.
Meanwhile, the nursing-home push diverted time and personnel from other signs of trouble with Medicaid, such as the explosive growth of spending on home care.
That funding covers invaluable services for disabled people who need it, but it’s also vulnerable to fraud and abuse.
James might try to dismiss the criticism of her record as politically motivated. If that’s the case, she should have little trouble knocking down the arguments and defending herself from federal probers.
Both the federal government and her campaign challenger are raising valid, substantive questions about a crucial function of the attorney general’s office.
Answers, please, AG James.
Bill Hammond is the senior fellow for health policy at the Empire Center.
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