(c) Basis for monetary penalties. The department may require the payment of a monetary penalty [as restitution] to the MA program by:

Section 516.2 is amended to read as follows:

516.2 Amount of penalty

(a) If a penalty has not been imposed upon the person within the past five years, the [The] department may impose a penalty of not more than [$2,000] $10,000 for each item of care, service or supply that is the subject of a determination under Section 516.1(c) of this Part.

Subdivision (a) of section 516.5 is amended to read as follows:

(a) [Any penalty imposed under this Part will be in lieu of requiring a person to refund or repay all or part of any payment from the MA program received by such person or caused to be received by another person as a result of a violation of those acts set forth in section 516.1 of this Part.] For each claim the department is authorized to recover any overpayment, unauthorized payment, or otherwise inappropriate payment and if twenty-five percent or more of those claims which are the subject of an audit by the department result in overpayments, unauthorized payments or otherwise inappropriate payments and for which the claims were submitted by a person for payment under the medical assistance program, the department may also impose a monetary penalty against any person, or persons, who received the overpayment, unauthorized payment or otherwise inappropriate payment for such claim. If less than twenty-five percent of identified claims result in overpayments, unauthorized payments or otherwise inappropriate payments then the department may recover such monies or may impose a monetary penalty, but not both.

New subdivisions (f) and (g) of section 516.5 are added to read as follows:

The Office of the Medicaid Inspector General (OMIG) was created within the Department of Health under Chapter 442 of the Laws of 2006 as the entity responsible for coordinating and implementing state-wide initiatives related to fraud and abuse within the medical assistance program.

Public Health Law § 32 (20) specifically authorizes OMIG to implement and amend, as needed, rules and regulations related to the prevention, detection, investigation and referral of fraud and abuse within the medical assistance program and the recovery of improperly expended medical assistance program funds.

OMIG is submitting this proposed regulation as a consensus rule pursuant to SAPA 202 (1) (b) (i) as no person is likely to object to the adoption of this rule as written. The basis for OMIG's determination is that the proposed regulation merely conforms to non-discretionary statutory provisions and makes technical changes that are required by those statutory provisions.

Social Services Law 145-b was amended by chapter 58 of the laws of 2007 to increase and revise monetary penalties resulting from the commission of certain proscribed acts in violation of the medical assistance program. This consensus rule amends the regulations to conform to the recently amended legislation.

The following is an in depth review of how the consensus rule amends section 516 of Title 18 NYCRR:

516.1(c):

Under the present § 516.1(c), monetary penalties may be instituted as restitution, permitting an interpretation that a demand for restitution excludes the imposition of a monetary penalty. To conform to the recently amended Social Services Law § 145-b (4), this subsection must be amended to provide that both restitution and a monetary penalty may be imposed for the same improper act.

§ 516.2:

Social Services Law 145-b was recently revised, increasing the maximum penalty that may be imposed for each item of care, service or supply that is the subject of a determination under § 516.1(c) to $10,000, increasing to $30,000 for each subject item if there has been a prior finding within the previous 5 years.

§ 516.5:

To conform to the recently amended Social Services Law § 145-b (4), this subsection must be amended to provide that both restitution and a monetary penalty may be imposed for the same improper act or claim under defined circumstances from the same responsible person. The regulation must also be amended to make it clear that, while total restitution recovered may not exceed the value of claims paid, multiple responsible persons may be required to pay a monetary penalty based upon the same improper act or claim. The clear ability of the department to charge both the offending orderer and provider of improper care, services or supplies provides the program with a cost effective tool for ensuring provider and orderer compliance and will act as a substantial deterrent to improper conduct.

Nature of Impact:

This proposed rulemaking will not have any impact on jobs and employment opportunities.

Category and numbers affected:

There are no categories of jobs or employment opportunities expected to be affected by the rule.

Regions of Adverse Impact:

Enactment of this proposed regulation would not have an adverse impact on jobs or employment opportunities. As such, there is no area of the state disproportionately affected.

Minimizing Adverse Impact:

There will be no adverse impact on existing jobs.