AP Report: Trump administration admits blatant error in its accusations of health fraud in New York

NEW YORK (AP) — President Donald Trump’s administration admitted this week that it made a major error in numbers it used to help justify an investigation into New York’s Medicaid fraud, a glaring error that undermines a federal push to tackle waste, much of it in Democratic-led states.

The error, which the administration first acknowledged to The Associated Press, prompted health analysts to question how many of the Republican administration’s sweeping anti-fraud efforts across the country were based on faulty findings. One of the few mischaracterizations made about New York’s Medicaid program, it also reflects a common criticism leveled at the second Trump administration — that it tends to attack first and assert facts later.

Read more: Minnesota files lawsuit to block Trump administration from withholding $243 million in Medicaid funds

“These numbers could have been spelled out in a phone call, so they are actually accelerating,” said Michael Kinnocan, a senior health policy adviser at the Fiscal Policy Institute, whose recent analysis drew attention to the Trump administration’s inaccurate claims.

The error came to light in comments made last month by Dr. Mehmet Oz, director of the Centers for Medicare and Medicaid Services, in a video on social media and in a letter to New York’s Democratic governor announcing the fraud investigation.

Oz claimed that New York’s Medicaid program last year provided about 5 million people with personal care services, which help people in need with basic activities such as bathing, personal care and meal preparation. That would add nearly three-quarters of the state’s 6.8 million Medicaid enrollees.

“This level of utilization is unheard of,” Oz said in the video, adding in his post that New York needs to “disclose its Medicaid program.”

But the real number of New Yorkers who used these services last year was about 450,000 people, or between 6% and 7% of total enrollment, CMS spokesman Chris Krebic told the AP this week. He said the agency misidentified New York’s approach to enforcing billing codes, and has since improved its methodology.

“CMS is committed to ensuring that its analyzes fully reflect the state’s billing practices and will continue to work closely with New York to validate data and strengthen oversight of program integrity,” he said in an email statement.

Krebic said the investigation is continuing because the administration still has concerns about New York’s oversight of personal care services and Medicaid and is reviewing the state’s response to last month’s letter. CMS raised other flags about New York’s program, including that it spends more per beneficiary and resident than the state average, has high spending on personal care and employs so many personal care aides that the job category is now the largest in the state.

Health analysts said the state’s high spending reflects New York’s high costs of services and policy choice to provide robust home care. Cadence Acquaviva, chief public information officer for the New York Department of Health, called the initial mischaracterizations of Oz a “targeted attempt to hide the facts.”

“New York State remains committed to protecting and preserving vital Medicaid programs that provide high-quality services to the New Yorkers who depend on them,” she said.

In a statement, a spokesperson for Gov. Kathy Hochul said, “The initial claim made by CMS was patently false, and we are pleased that they have now acknowledged that.”

“Governor Hochul has been clear that New York has zero tolerance for waste, fraud, and abuse in Medicaid or any other government programs, and will continue its efforts to root out bad actors, protect taxpayer dollars, and protect important programs New Yorkers depend on,” said New York spokeswoman Nicolette Simmonds.

The New York investigation is part of a larger crackdown

The Trump administration’s investigation into New York comes as it has similarly reached out to at least four other states, including California, Florida, Maine and Minnesota, to conduct investigations into potential health care fraud. Anti-fraud efforts appear to be expanding as voters in the upcoming midterm elections say they are concerned about affordability.

Last month, Trump signed an executive order to create a task force to combat fraud across federal benefits programs, led by Vice President J.D. Vance. As part of that project, Vance announced that the administration would temporarily halt $243 million in Medicaid funding for Minnesota over fraud concerns, a move the state has since sued over.

Kinokan, the experienced Medicaid analyst in New York, said he is concerned that the Trump administration’s aggressive approach to targeting fraud in some states is “politicizing” a conversation that should be a team effort.

“We want to think collaboratively among all stakeholders in the program about how we can actually fix it,” Kinokan said. “We don’t want there to be fraud in this political football.”

Oz made other claims that New York advocates say are inaccurate

In his video, Oz makes at least two other claims about New York that Medicaid advocates and beneficiaries say distort the facts.

In one case, he said the state recently made its screening for personal care eligibility “more lenient by allowing problems like ‘easily distracted’ to qualify for a personal care aide.”

The opposite is true — the state in a rule change that took effect last September made its program requirements more stringent, said Rebecca Antar, director of the Health Law Unit at the Legal Aid Society. Their “ease of distraction” is nowhere to be seen, she said.

The official was referring to whether New York’s standard for personal care services was “sufficiently stringent,” Krebic said.

“When standards are overly lax, it risks diverting resources away from individuals with the highest levels of need, and puts long-term pressure on the sustainability of Medicaid,” he said.

In the video, Oz also referred to personal care services as “something our families typically do for us, like carrying groceries.”

Kathleen Downs, a 33-year-old who has quadriplegic cerebral palsy and uses personal care services in Nassau County, New York, said she was offended by the idea that all Medicaid beneficiaries have family members willing and able to help.

Downs, who has been disabled since birth and needs help with personal care for things like bathing, using the toilet and eating, said she hires her mother and outside helpers for personal care services, so her elderly mother doesn’t have to take on those tasks full-time. She said her mother had been doing this unpaid work for years, which prevented her from pursuing other career opportunities.

“It assumes everyone wants it and can do it for free forever,” Downs said. “This is not possible for a lot of people.”

Associated Press writer Anthony Izaguirre contributed to this story.