A tiny middle class enclave generates many Medicaid bills
Medicaid is a health care program reserved, primarily, for the poor.
Benefits are based on federal poverty guidelines. To be eligible in New York state, a single person must earn less than $17,000 a year.
With that in mind, you might expect the most impoverished neighborhoods would be the ones that generate the most Medicaid bills.
That's not true.
It turns out the state’s highest Medicaid billing total can be found within a relatively affluent community: Rego Park, Queens.
With the help of the New York Office of the Medicaid Inspector General, NBC New York examined Medicaid data from all of the state’s nearly 15,000 zip codes.
The analysis found Rego Park -- a neighborhood with a median income above $50,000 -- generated more than $1.5 billion in Medicaid reimbursements in 2010. Because the health care program is aimed at helping poor people, the findings had regulators scratching their heads.
“Why is Rego Park the highest? It’s something we have to look at,” said Deputy Medicaid Inspector General Michael Little.
Rego Park occupies a triangular plot of central Queens, roughly bordered by Woodhaven, Yellowstone and Queens Boulevards. The enclave is dotted by dozens of pharmacies, dentists, and medical device makers, but the neighborhood has no major hospital.
With 7 percent of the state’s $20 billion Medicaid budget passing through the 1.9-square-mile neighborhood, some observers believe Rego Park is the kind of community that deserves more regulatory scrutiny.
“These are places where the Medicaid Inspector General’s Office need to look at more closely to make sure that there is real honest alignment between the services that are provided and the needs of the patient,” said Paul Howard, a senior health policy analyst at the conservative think-tank Manhattan Institute.
Investigators who police New York’s Medicaid program use software designed by Salient Management Company, an upstate developer of data management tools. The data-mining computer program helps find suspicious patterns and unusual trends in health care billing. The office of the Medicaid Inspector General has about 50 investigators to battle fraud all over the state.
“Fifty investigators for billions and billions of dollars in claims. That means they have to be able to sift through data very quickly to get to the most likely targets for recovery,” said John Amisano, Salient senior health care adviser.
After learning the state’s single highest Medicaid billing total is within Rego Park, Michael Little’s office began to use the software to look deeper into the numbers.
“Why are they the biggest? Is it normal? Is it expected,” Little said.
By running data queries, Little discovered one of the state’s largest Medicaid managed care contractors uses a Rego Park address to process bills -- a clear reason for the high billing volume.
That doesn’t mean investigators won’t continue to have their eyes on the Queens neighborhood.
In his data query, Little also discovered pharmacy reimbursements make up the second largest share of Medicaid bills in Rego Park. That is significant because Rego Park pharmacists have been snared for fraud in the past. Most recently, federal prosecutors busted Rego Park’s ASA Pharmacy for taking part in a $2.5 million kickback scheme.
There are 13 Rego Park medical service providers who have been banned from participating in Medicaid.
“Our job is to prevent fraud, waste and abuse in the Medicaid program and New York State Legislature, when they established our office, did not want us to wait around for it to bite us,” Little said.