AUDIT REVEALS NASSAU SOCIAL SERVICES
ANTI-FRAUD UNIT IS SHORT-STAFFED

An audit by the Nassau County Comptroller’s Office of the county’s Medicaid fraud prevention unit has concluded that resources directed toward anti-fraud activities are inadequate to protect the county’s $520-million social service budget, Comptroller Howard S. Weitzman announced today.

The findings echo the conclusion of a September 2002 review of the unit by the New York State Office of the Welfare Inspector General, which also found the Nassau unit understaffed.

“The Nassau Special Investigations Unit (SIU), part of the Department of Social Services, is in charge of ferreting out Medicaid fraud and other waste in social service programs. Unfortunately, it is grossly understaffed and under-funded,” Comptroller Weitzman said.Medicaid contribution and our available revenues expected to exceed $35 million per year by 2007, we need to do everything we can to cut the cost of the program locally – just as Albany needs to do more to control the cost of the program statewide.

“Ten percent of public-sector health care expenditures is lost to fraud and abuse, according to estimates by both the state and the federal General Accounting Office. Moreover, studies show that anti-fraud activities in health benefits are an exceptionally good investment. One such study, by the Healthcare Insurers Association, found that for every dollar its members spend on anti-fraud activities, they save 11 dollars.

“This suggests that it is critically important that we provide sufficient funding for these anti-fraud activities. Yet the county does not. In 2000, the SIU had ten field investigators; currently it has half that amount, and during the audit period (from January 1, 2002 through April 30, 2003) the number of field investigators had fallen to as few as two. Nassau has more than 68,000 public benefit recipients. Clearly, this unit needs to be restored to full strength,” Mr. Weitzman said.

In its September 2002 report, the New York State Welfare Inspector General’s office found, in a similar vein, that “Nassau County is the seventh largest district in terms of its welfare rolls and it has the eighth largest workforce. However, Nassau County DSS ranked 15th in the number of staff dedicated to combat fraud and abuse.”

Comptroller Weitzman said, “I am glad to note that DSS has already begun to address many of the problems noted in our audit report, and I commend the department for doing so. Nevertheless, in order to achieve the kinds of savings possible with an effective anti-fraud effort, the county must provide adequate staffing and resources to this unit.”

Among the Comptroller’s other findings:

• The Unit has one supervisor who is covering responsibilities formerly assumed by three supervisors;
  
• The investigative staff is entirely composed of welfare examiners who do not have appropriate backgrounds in investigations, criminal justice and/or law;
  
• The unit's field and investigative procedures are insufficient;
  
• The department requires investigators to perform field visits alone, possibly jeopardizing their safety. Similar agencies in other jurisdictions, such as New York City, send two examiners to conduct each field visit.
  
• In Nassau County, the District Attorney's Office prosecuted only four of the 240 referrals during fiscal years 1999-2001, a rate of less than two percent - primarily because of incomplete files.
  
• The department's Web site tells visitors to call 24 hours, 7 days a week to report welfare fraud, but does not list a telephone number. Calls to the phone number listed under DSS-Fraud Investigation in the telephone book yielded a message that the number is "not in service and no further information is available."
  
• The Unit's usual practice is to close cases where fraud is suspected, without thorough investigation and documentation. As a result, the full extent of the fraud is not discovered, and state-mandated recoveries and prosecutions are not being made.

The full report may be downloaded, viewed and printed by clicking on the report title below.