Medigate, Day 4:  Spitzer Writes Bruno and Silver
But Legislators Won't Interrupt Their Vacations;
Two Editorials Denounce the Continuing Fraud
Which Costs Taxpayers $12 Million Each Day.

By Henry J. Stern
July 21, 2005


There is a lot to read today as we pursue Medicaid fraud for the fourth day.  It is probably too much material for some of you, who may be outraged at the scandal, but do get a lot of other e-mail at work or at home.  Our goal is for the Q list to get a daily report and the W list a weekly summary.  You are on the R, or Regular, list and would normally get an article two or three times a week.
 
In an effort to keep the Medicaid fraud issue in the limelight where it belongs, we have been writing longer and more frequent R's than usual.  If you find it too much to read, file it, skip it, or switch to W.  If you want everything we write, add Q.  There are a number of interesting, perhaps even juicy, items we have left out of R so as not to burden readers while we follow Medicaid.



We are convinced that Medicaid fraud and waste is New York State's version of the United Nations Oil for Food scandal.  These grandest of larcenies are comparable in two ways: 1) their enormity, tens of billions of dollars stolen, in one case from the people of Iraq, in the other from the taxpayers of New York and 2) divided responsibility and blame-shifting, Kofi Annan and his staff faults the Security Council and its mandates, and vice versa, and, in New York, the Health Department notes the attorney general's enforcement responsibility in the area, and versa vice, while the Legislature, particularly the Assembly, sits on its hands.  
 
With Medicaid fraud and waste estimated at ten per cent of expenditures, and with the total annual cost of the program at $44.5 billion and rising each year, one can calculate that the amount wasted each day is $4.45 billion divided by 365, which comes out to $12,191,781 a day, give or take a few grand.  

We will count the days that it takes our four major elected officials to bring about drastic change in a rotten system, which has pillaged the State of New York while powerful lobbies run interference on behalf of criminals with degrees. One is Dolly the Dentist, who cloned herself so as to perform 991 reimbursable dental procedures in a single day.  Even this obvious fraud was not detected by the state, it was the New York Times that did the computer work needed to bring the tooth fairy and her elves to justice.

 
The game plan of the bad guys is for the good guys to lose interest and influence over time, while the colossus and its lobbyists open their pockets to maintain the status quo, or to allow superficial reform without reaching the bulk of the padding.  The Bruno-Silver standoff allows matters to die with each house ostensibly being supportive.  People will have to wake up to the level of hypocrisy, camouflaged by sanctimony, that one encounters near the swamp where the Mohawk joins the Hudson.

We would like to help keep this major, major issue alive by reporting to you 1) when anything noteworthy is said or done, and 2) when a day passes with no progress on reform.
 
This sunny Thursday, three New York City dailies have their own items on the scandal, and the Albany Times-Union carries an AP dispatch.
 


The Times, B3, by Michael Luo (it may be Clifford Levy's day off) SPITZER MAKES PUSH FOR NEW LAWS TO HELP PUNISH MEDICAID FRAUD.  Lede: ''Attorney General Eliot Spitzer called on state lawmakers to return to Albany to pass two bills that he said were urgently needed to help prosecute fraud in the state's Medicaid system.
 
"In a letter to Senate Majority Leader Joseph L. Bruno and Assembly Speaker Sheldon Silver, Mr. Spitzer said the state needed a false claims act, which would increase civil penalties for fraud and encourage whistle-blowers, along with another law that would create a new category of crimes specific to health care.  He said he had urged the passage of such bills in the past without success.
 
''On Tuesday, in reaction to the {New York Times articles}, Gov. Pataki announced plans to overhaul Medicaid's oversight system through an executive order creating an independent inspector general's office to focus on fraud.  In a telephone interview, Mr. Spitzer applauded the governor's proposal....
 
"Representatives for both Mr. Bruno and Mr. Silver sidestepped questions yesterday about whether they would take up Mr. Spitzer's suggestions...."
 
To get the full flavor of the pas de quatre now emerging between Messrs. Pataki, Spitzer, Bruno and Silver, link to Luo's story.  

The usual outcome in Albany has been that, although both parties support reform, they cannot agree on precisely which reforms to adopt, and as a result one-house bills are passed and no new legislation is adopted.  We will see if the legislature does any better this fall.  Today is Day 4, counting from Monday, the first installment of the Times' expose.  On Day 4, God created the Sun, Moon and stars.  But He had no obligations to lobbyists.
 
The Daily News publishes a strong editorial this morning on the subject, p34: BAND-AID SOLUTION FOR MEDICAID FRAUD.

"Shamed, embarrassed, caught with his pants down and lacking a good explanation for the loss of untold millions of taxpayer dollars, Gov. Pataki on Tuesday said he was establishing an inspector general to battle a tsunami of fraud in New York's $44.5 billion Medicaid program.  Oooooh, an inspector general!  That'll throw a fright into the thieves who are robbing the program blind, for sure.

"Establishing an inspector general, with all the tough-sounding connotations of the title, was the rushed act of a politician desperate to say he was doing something about the megatheft that has been taking place under his nose -- and under the noses of the state's legislative leaders and attorney general -- for years.

"The stench has been obvious for as long as there have been Medicaid mills, those one-flight-up medical offices well-known for churning patients, billing for unnecessary services and dispensing narcotics to addicts.  The Daily News has exposed the scams over and over.  This week, The New York Times took a huge crack at it..."
 
The entire Daily News editorial is one of the most powerful we have read.  It is Arthur Browne on a tear.  Link to it.
 

Newsday chips in with an editorial on pA36: "A WASTE OF HEALTH CARE; More Evidence of the Need for Reform."  The paper cites its own series on the need to reduce waste and fraud.  Newsday had suggested "investing in computer technology and personnel that would more than pay for itself..."  The editorial makes one specific observation: "The Democrat-controlled Assembly has shown too little appetite for whacking away waste."


 
The Albany Times-Union carries an Associated Press story by Mark Humbert: "AG SEEKS TOOLS FOR MEDICAID FRAUD FIGHT; Spitzer Calls for Passage of Legislation That Would Reward Whistle-Blowers, Stiffen Penalties for Cheaters."
 
Lede: "State Attorney General Eliot Spitzer, under fire along with Gov. George Pataki for not doing enough to combat Medicaid fraud, called Wednesday for the state Legislature to return to Albany and immediately pass legislation that could help him do a better job.  Spitzer's letter to ...Silver and ...Bruno came after the New York Times began an investigative series this week faulting Pataki, Spitzer and other state officials for failing to match the success of many other states in catching those who cheat the health care program for the poor.  New York's $44.5 billion Medicaid program is the nation's largest." 



We jump a few lines in the AP story to get the leaders' reaction.

"Silver spokesman Charles Carrier said there were no plans to call the Assembly back into session to act on the Spitzer bills, but that the chamber's Democrats would continue to review such legislation, the governor's initiatives and possibly even hold public hearings.

"A spokesman for Bruno, a  Republican, also said he had no plans to call his colleagues back from their summer vacations to act on the Spitzer measures.

"Bruno said Wednesday that a Senate task force would be holding public hearings on the issue."
 
We called the Attorney General's office for copies of the letters he had sent, and we received them promptly.  Both the Bruno-Silver letter of July 20 and a June 10 letter to Michael O. Leavitt, U.S. Secretary of Health and Human Services, asking him to lift federal restrictions on data-sharing, are now on the AG's website and you can link to them there.  Bob Hardt, in the Political 1tch, wrote accurately with regard to the Bruno-Silver letter that "Eliot Spitzer is piggybacking on the Times Medicaid fraud series."  Disclosing the earlier letter to Leavitt is Spitzer's way of showing his pre-Times concern with fighting Medicaid fraud.  



The question arises: If the Attorney General, who is a fine public servant, did not need special legislation to go after Wall Street, where he extracted hundreds of millions of dollars in settlements from privately-owned companies anxious to save their senior managers from criminal prosecution, why does he need Joe Bruno and Shelly Silver to pass a special bill to let him pursue Medicaid fraud, when it is New York State itself that has been cheated, and he is the lawyer for the State.

The AG should do the best he can today with the resources he has or can make available, at the same time as he seeks the broader powers, resources and staff which we believe he should be given.  If the matter is resolved by September 20 (an optimistic speculation), only another $731,506,860 will have been stolen or wasted.  The dollar clock on Medicaid waste ticks twelve million times a day; it rivals the Durst clock on the national debt.