The US Department of Justice filed a lawsuit against Gov. Kathy Hochul\u2019s administration Tuesday claiming it rigged the bids on an $11 billion Medicaid homecare program \u2014 allowing a handpicked company to siphon off millions in taxpayer money.<\/p>\n
State Health Commissioner James McDonald and Medicaid Director Amir Bassiri are both named in the lawsuit<\/a> which lays out startling new allegations that claim Hochul\u2019s administration schemed to consolidate payroll services<\/a> for nearly 250,000 homecare recipients under Public Partnerships LLC and moved forward with the disastrous transition<\/a> despite clear warning signs of the coming chaos.<\/p>\n \u201cNew York\u2019s failure to police a favored vendor that unlawfully siphoned millions of dollars of Medicaid funding is egregious and betrays the public trust,\u201d Brett A. Shumate, assistant attorney general for the Department of Justice\u2019s Civil Division, wrote in a statement.<\/p>\n New York State is accused of failing to stop a vendor who fleeced taxpayers. Andrew Schwartz \/ SplashNews.com<\/p>\n \u201cThe Justice Department is acting to ensure that federal laws regarding truthful statements and fair dealing in federal health care programs are upheld and to prevent additional harm from being exacted against the public by PPL and New York,\u201d Shumate added.<\/p>\n Hochul is not directly accused of wrongdoing in the 55-page complaint filed in US District Court Eastern District of New York but snippets of emails between her office, the health department and PPL uncovered by federal investigators show she was actively involved in not only the transition process, but also the awarding of the bid to the company.<\/p>\n U.S. Deputy Assistant Attorney General for Civil Division Brett A. Shumate speaks during the investiture ceremony for U.S. District Judge Trevor N. McFadden April 13, 2018 at the U.S. District Court in Washington, DC. Getty Images<\/p>\n \u201cAs late as Tuesday, September 17, 2024, Defendant BASSIRI was part of last-minute email exchanges with DOH\u2019s counterparts in other states in which DOH officials stated that under \u2018pressure from our Governor\u2019s Office,\u2019 they were trying to determine whether other bidders\u2014at least one of whom ended up being a qualified bidder\u2014were actually performing FI services in other states and were therefore qualified bidders,\u201d the lawsuit notes.<\/p>\n Several months later, after PPL had been awarded the bid, the company\u2019s own reps proposed to DOH that it extend the timeframe needed to transition CDPAP recipients and caregivers to its own platform from three months to nine months as it rushed to hire staff.<\/p>\n But Hochul\u2019s office refused to extend the timeline, according to internal emails from a \u201cDOH principal\u201d included in the complaint.<\/p>\n State Health Commissioner James McDonald was named in the lawsuit. New York State Department of Health<\/p>\n \u201cI wanted to give you a heads up that Chamber is coming in hard on the SFI [Statewide Fiscal Intermediary] launch, they really aren\u2019t entertaining options to move off of a path that gets this done by 4\/1. We will not be advancing statutory or regulatory changes [to extend the CDPAP transition timeframe] at this time,\u201d the DOH staffer wrote.<\/p>\n Over the next few months, Hochul\u2019s office was actively involved in downplaying the seriousness of the transition disaster as thousands of disabled New Yorkers spent hours dealing with horrible customer service problems as they tried to keep their caregivers paid.<\/p>\n On Jan. 13, 2025, a week after the transition window opened, only 43 of the 214,000 people in PPL\u2019s system had completed, per PPL records unveiled in the lawsuits.<\/p>\n Medicaid Director Amir Bassiri was also named in the lawsuit. New York State Department of Health<\/p>\n