Albany-based Research Foundation of the State University of New York agreed to pay $4 million to settle allegations employees falsified Medicaid audits in a violation of the False Claims Act, according to the Syracuse Post-Standard.
The foundation's Center for Development of Human Services was contracted to audit New York's Medicaid programs to identify the error rate of ineligible patients who received Medicaid benefits between October 2007 and September 2008. The foundation was hired as part of a federal mandate to randomly audit state Medicaid programs.
The suit alleges the foundation falsified these audits.
A federal judge unsealed the suit Monday, which was filed by federal prosecutors and five former Research Foundation employees, who will together receive a total of $825,000 as a whistleblower reward.
Federal prosecutors opened their own investigation after one of the former employees, Ava Dock, filed a separate lawsuit in 2009. Ms. Dock claimed she was fired from the foundation for revealing false claims. Ms. Dock was terminated a few months after she sued the foundation, claiming employees altered information before it was presented to auditors, according to the report. The alleged intent was to underreport the state's error rate to be near the maximum 3 percent to ensure the receipt of an annual $22 billion in federal Medicaid funds, according to Ms. Dock's suit. The error rate was actually near 20 percent, according to the suit. Her suit was settled in 2011.
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