DiNapoli Versus Cuomo Administration, Yet Again

Comptroller Tom DiNapoli’s office this week once again found itself in a dispute with Gov. Andrew Cuomo’s administration over the contents of a critical audit.

This time, it was a report released by the comptroller’s office that drew on more than 70 audits of the state’s handling of the Medicaid program.

The Department of Health moved to swiftly rebut the concerns raised by the report, which pointed to hundreds of millions of dollars in improper payments, along with missed revenue opportunities.

In a lengthy statement, the DOH pointed to the Cuomo-led effort to redesign the state’s costly Medicaid program, which has resulted in a flattening of spending.

At the same time, the DOH noted that many of the issues raised by the report date back several years and have been corrected.

“In the few instances where funds have not been recouped, DOH will recoup or collect them through its strong enforcement effort,” the department said in a statement. “DOH and OMIG are committed to recouping or collecting all overpayments identified in any OSC audit.”

In response, DiNapoli’s communications director said the reaction from the DOH misses the point of the report.

“It is an expensive program, and our auditors have found problems,” said spokeswoman Jennifer Freeman. “Instead of being so defensive, in the interest of taxpayers, the department should consider our recommendations.”

This isn’t the first time DiNapoli’s office has debated the contents of a review of administration policy and spending with the Cuomo administration.

DiNapoli and Cuomo have sparred over the finer points of the state budget as well as the moving of funds within the spending plan after approval.

Two years ago, the comptroller sparred with Cuomo’s budget office over the borrowing in the state budget. That, too, resulted in a back-and-forth with the administration and DiNapoli.

Later, the Department of Financial Services wound up auditing DiNapoli’s office as well, issuing a critical report of the comptroller’s computer system.

Cuomo declined to endorse DiNapoli in 2010; he did endorse his re-election in 2014.

DiNapoli Report Finds $513M In Improper Medicaid Payments (Updated)

A report released on Wednesday by Comptroller Tom DiNapoli’s office found $513 million Medicaid payments deemed improper as well as missed opportunities for revenue over a four-year period.

“Medicaid is a vitally important program, insuring nearly 6.4 million New Yorkers and enabling them to access health care that would otherwise be unaffordable,” DiNapoli said in a statement. “But New York’s Medicaid program costs billions of dollars annually and the work done by my auditors has found waste throughout the system. My office will continue to diligently examine Medicaid payments to make sure healthcare dollars are being spent appropriately and taxpayer dollars are not squandered.”

The report draws on dozens of audits conducted by the comptroller’s office since 2011, which found deficiencies in the eMedNY computer system that processes Medicaid claims.

At the same time, the state has failed to collect more than $170 million in rebates and discounts for drugs, as well as made $160 million in improper payments for services provided to those enrolled in both the Medicaid and Medicare programs.

Additional overpayments came from issuing multiple client identification numbers and duplicate payments made by managed care organizations.

Update: The Department of Health is pushing back on the comptroller’s report, calling it a “a complete mischaracterization of the state of New York’s Medicaid program.”

In particular the DOH says the report combines 73 different audits, with many of the issues raised having already been addressed.

“In the few instances where funds have not been recouped, DOH will recoup or collect them through its strong enforcement effort. DOH and OMIG are committed to recouping or collecting all overpayments identified in any OSC audit.”

In addition, the DOH points out that the Medicaid redesign efforts have lowered spending by $4 billion a year.

15d1 by Nick Reisman

DiNapoli Gets Federal Return, Owes The State

Comptroller Tom DiNapoli in 2014 earned $159,445, mostly through his public salary as the state’s overseer of the pension fund.

DiNapoli paid $9,339 in federal income taxes and received a $5,399 return.

On the state level, DiNapoli $9,419 in taxes and owed the state $223 after taxes.

DiNapoli also reported paying $7,656 in property taxes on his condominium he owes on Long Island.

DiNapoli made his 2014 tax returns available to reporters on Tuesday, showing that he also earned $922 in capital gains and reported $11,452 in dividends, mostly through telecommunications companies Verizon, Vodafone, Comcast and AT&T.

DiNapoli reported $6,481 in charitable gifts, including a $100 clothing donation to Big Brothers, Big Sisters of Long Island. He also gave $100 to public radio station WAMC, $1,475 to St. Aloysius Church and $80 to the Metropolitan Museum of Art.

Last year, DiNapoli contributed $5,494 to charity.

DiNapoli Bill Would Create Retiree Insurance Pools

A measure introduced at the behest of Comptroller Tom DiNapoli on Monday would create an optional investment pool aimed at strengthening health insurance for state and local government retirees.

The bill is aimed at addressing an under funding of post-employment benefits on the state and local government level, which are estimated to be $68.2 billion and $68.3 billion.

“New York is behind the eight ball on this issue. More than thirty states have already put rules in place that allow public employers to set aside money today to pay for these benefits,” DiNapoli said. “The numbers are daunting, but there is a real cost to doing nothing and leaving the bill for future generations of taxpayers to cover. The legislation would establish the legal structure for creating trusts that the state and local governments could use to start saving the funds needed to pay for these benefits. The responsible, good government thing to do is to start preparing for the future and plugging the hole before we reach a crisis moment.”

The bill would create irrevocable post-employee benefit trusts that are separate from the state’s common retirement fund with the option of the state government and local governments contributing to the fund.

A fund would be established under the control of the state comptroller’s office for the investment of post-employment benfit assets from both state and local governments.

School districts would be allowed to transfer portions of their reserve balance to the trust once it is up and running.

DiNapoli’s office says regular annual contributions from the state to the trust, plus an earned return on investments, could lead to billions of dollars being saved.

DiNapoli Launches Local Authority Audits

With more than 600 local public authorities operating with little oversight and transparency, Comptroller Tom DiNapoli’s office says it has launched a series of local audits to shine some light on their activities.

In a report released on Thursday, DiNapoli’s office pointed to the $1.5 billion in spending and $18 billion in debt the state’s public authorities have incurred over the years while employing 4,300 people.

“My goal is to shed light on these types of entities – share what we know and what we have yet to fully understand,” said DiNapoli. “Because local authorities fly so low under the radar, operating without the oversight and controls required of municipal governments, it’s difficult for taxpayers to know how effective they are. My audits have shown an increased risk of waste and abuse by these entities, sometimes leaving taxpayers on the hook for millions of dollars in inappropriate costs.”

Public authorities are often considered New York’s “shadow government” and can help fund public projects outside of the normal laws governing public borrowing. But the proliferation of public authorities — a push championed by builder Robert Moses during the 20th century — has led to a complex web of quasi-public entities that are difficult to track.

DiNapoli’s report issued today found Westchester County has the highest number of public authorities outside of New York City at 46, with Nassau County have the second-highest, 31.

Sixty percent of local authority expenditures accounted for water, sewer and solid waste authorities that reported spending $925 million.

Local Authorities 0415 by Nick Reisman

DiNapoli: OT Hours Increase By 1M (Updated)

Overtime hours at state agencies increased by 1.1 million in 2014, a 7.3 percent increase over 2013, a report released Wednesday by Comptroller Tom DiNapoli found.

The total earnings and overtime hours statewide in 2014 hit a seven year high, according to the report.

The report found that total overtime accrued last year reached 15.9 million hours — translating to $661.2 million in costs, an 8.2 percent increase.

The Office for People With Developmental Disabilities recorded the highest overtime total in the state, 4.2 million hours — more than a quarter of the total overtime hours accrued last year.

The state Department of Correctional Services was second, with 3.5 million hours.

Mental Health was third, recording 2.6 million hours of overtime.

Updated: Here’s a statement from Gov. Andrew Cuomo’s spokesman Rich Azzopardi.

“This cherry-picked data omits the key fact that total personnel costs are down by $588 million compared to just before the Governor took office. Overtime is used carefully and only when needed. The alternative would be a larger, more bloated, and more expensive state bureaucracy that special interests may like, but New York taxpayers simply can’t afford.”

Here’s the full report:

State Agency OT Report2015 by Nick Reisman

DiNapoli: A ‘Timely Budget’ That Lacked Transparency

Comptroller Tom DiNapoli in a statement on Wednesday complimented Gov. Andrew Cuomo and the Legislature for approving a “timely budget” but also chided the process for lacking openness.

The budget wasn’t necessarily “on time” given that the remaining bills were approved after the midnight deadline for the start of the new fiscal year.

DiNapoli in the statement added this office is reviewing the $143 billion spending plan with an eye toward the state’s debt and finances in future fiscal years.

Here’s the statement:

“Governor Cuomo and the Legislature deserve credit for adopting a timely budget. Still, it is unfortunate that this year’s budget process was not more transparent. My office will analyze and report on the enacted budget in detail, including its impact on the state’s debt and out-year finances.”

Assembly, Senate Combine For Almost $1M In Legal Bills

The state Assembly and Senate combined for nearly $1 million in legal fees last month associated with various sexual harassment scandals in one house and for representation related to the Moreland Commission To Investigate Public Corruption in the other, according to Comptroller Tom DiNapoli’s office.

The Democratic-led Assembly was approved for $545,000 to “various recipients” in order to settle the sexual harassment lawsuit against one-time Brooklyn power broker Vito Lopez.

The former assemblyman resigned following a Joint Commission on Public Ethics report that revealed the details of abuse and harassment by Lopez directed toward his legislative staff.

Ultimately, two staffers sued Lopez and the Assembly in court, which was recently settled.

Meanwhile, the Assembly also spent $13,000 for outside legal counsel from Whiteman Osterman & Hanna in the appeals process for former Assemblyman Micah Kellner, who was accused of sending inappropriate texts and online chats with legislative employees.

Kellner did not run for re-election last year.

In the Republican-led Senate, $435,000 was approved in legal bills to Kirkland & Ellis, which is special counsel for the conference in the Moreland Commission investigation.

The commission ultimately shuttered last year following an agreement on ethics measures in the state budget.

The panel’s closure, as well as the evidence it generated, is being reviewed by U.S. Attorney Preet Bharara.

DiNapoli: U.S. Steel To Disclose Political Giving

Following pressure from Comptroller Tom DiNapoli, United States Steel Corp. will disclose its corporate political spending, his office announced on Monday announced.

The agreement is similar to the previous efforts from DiNapoli’s office to have companies the state’s common retirement fund has invested in to disclose their political activity.

The common retirement fund has an estimated $20 million in shareholder value in U.S. Steel.

DiNapolis has used the state pension fund’s investments to leverage agreements out of companies to disclose their giving, including H&R Block and Valero Energy this year alone.

“In the aftermath of the U.S. Supreme Court’s decision in Citizens United, investors and the larger public have been left in the dark on the extent of the reach of corporate dollars in politics,” DiNapoli said. “U. S. Steel is to be commended for agreeing to voluntarily disclose its political expenditures. Shareholders need transparency in order to determine whether corporate political spending benefits the company’s long-term value.”

DiNapoli is currently trying to gain agreements with 11 other companies the fund has invested in, including Aetna Inc., Delta Air Lines, Express Scripts Holding Co., NextEra Energy Inc., Nisource Inc., Raytheon Company, The Travelers Companies Inc., Waste Management Inc., Western Union Co., and Wynn Resorts.

All together, 27 companies have agreed to disclose their political spending.

DiNapoli: Medicaid To Grow By $700M Annually

The state’s spending for its Medicaid program is expected to increase by $700 million annually over the next four years.

Still, Comptroller Tom DiNapoli in a report issued on Thursday found progress in controlling annual growth in the costly health-care program.

Yearly growth in the program is expected to be less than 2 percent following an effort by the Cuomo administration to overhaul how money is spent in the Medicaid perogram.

DiNapoli’s report added, however, that the efforts to overhaul Medicaid bring some risk, include losing out on federal dollars.

“New York’s Medicaid program is undergoing major changes, with ambitious plans ahead that also carry risk,” DiNapoli said. “A federal waiver may bring as much as $8 billion in additional aid as an incentive to drive further reforms. However, failure to meet key benchmarks would result in a loss of significant potential federal funding. That could force the state to increase its own spending on the program or rein in Medicaid costs in ways that have been largely avoided in recent years.”

Medicaid enrollment in New York has grown between 2010 and 2013 by 12.3 percent, or 580,000 new beneficiaries. Enrollment in the program is estimated to exceed 6.4 million in the fiscal year after next, 2016-17.

State-based spending in Medicaid is expected to grow by $2.8 billion by 2018-19, according to the Division of Budget.

Medicaid 2015 by Nick Reisman