New York, New York — The federal agency overseeing Medicare and Medicaid has admitted it used wildly inaccurate figures to justify a high-profile fraud investigation into New York’s Medicaid program — a blunder that’s now raising questions about whether the administration’s broader anti-fraud campaign is built on solid ground.
The Centers for Medicare & Medicaid Services, led by Dr. Mehmet Oz, claimed last month that New York’s Medicaid program had provided personal care services to roughly 5 million people in a single year. That figure — nearly three-quarters of the state’s 6.8 million Medicaid enrollees — was central to Oz’s public case that New York needed to “come clean” about its program.
The real number? About 450,000 people, or between 6% and 7% of enrollees. CMS acknowledged the error to the Associated Press this week, saying the agency had misread how New York applies its billing codes and has since updated its methodology.
“These numbers could have been cleared up in a phone call, so it’s really slapdash,” said Michael Kinnucan, a senior health policy adviser at the Fiscal Policy Institute, whose analysis first flagged the discrepancy.
Why It Matters for Nursing Homes
Personal care services — the kind at the center of this dispute — are the same Medicaid-funded supports that help keep older adults out of nursing homes. When federal officials target these programs for fraud, the ripple effects reach long-term care operators who depend on Medicaid reimbursement and whose residents often rely on those same services before and after facility stays.
The administration’s anti-fraud push has already rattled nursing home operators in multiple states. As industry reports have noted, the administration’s Medicaid playbook has put nursing homes in a dozen states in the crosshairs, with investigations launched in California, Florida, Maine, and Minnesota alongside New York.
In Minnesota, the administration temporarily froze 43 million in Medicaid funding over fraud concerns — a move the state has since challenged in court.
The Probe Continues Despite the Error
CMS spokesman Chris Krepich told the AP the investigation into New York is ongoing. The agency says it still has concerns about the state’s oversight of personal care services, its above-average per-beneficiary spending, and the sheer size of its personal care aide workforce — now the largest job category in the state.
New York officials weren’t buying it. A spokesperson for Gov. Kathy Hochul said the initial claim was “patently false” and called the correction long overdue. The state’s health department called Oz’s original characterizations “a targeted attempt to obscure the facts.”
Kinnucan said the bigger concern isn’t just this one error — it’s what it signals about the administration’s approach. “We want to think collaboratively among all the stakeholders in the program about how we can actually fix it,” he said. “We don’t want fraud to be this political football.”
For nursing home operators watching from the sidelines, the episode is a reminder that federal Medicaid enforcement — accurate or not — can move fast and hit hard. The question now is whether other states targeted in the crackdown are working from equally flawed data.
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