New York Health Insurer Must Repay $7.7M After Using Excluded Medicaid Provider
A health insurer has been ordered to repay almost $7.7 million to the New York state Medicaid program after using a company run by a social worker who had lost his license and been excluded from the Medicaid program. The New York-based health insurance company Fidelis Care, a subsidiary of Centene Corp, administers managed health care plans available to residents of New York, including individuals enrolled in the New York State Medical Assistance Program (Medicaid).
The Medicaid Managed Care/Family Health Plus/HIV Special Needs Plan/Health and Recovery Plan Model contract with the New York Department of Health requires Fidelis Care to ensure that providers used for Medicaid-reimbursed services and their owners are appropriately licensed to practice by the state and have not been excluded from the Medicaid program. The Medicaid Fraud Control Unit investigated Fidelis Care and determined that, from February 7, 2019, to July 30, 2021, Fidelis Care used a company called Cornerstone Herkimer LLC, whose sole owner and director was Ward Halverson.
Ward Halverson had his license to practice suspended by the New York State Education Department after being convicted of firing a BB gun at a child and was added to the Medicaid exclusion list on May 1, 2017. Fidelis Care was made aware no later than December 14, 2018, that Halverson had been excluded from participation in the Medicaid program and continued to serve as principal at Cornerstone but failed to terminate the agreement with his company and continued to pay Cornerstone until July 30, 2021.
The settlement agreement requires Fidelis Care to repay $7,681,796.44 to the state Medicaid program. Fidelis Care is also required to determine the identity and exclusion status of all new providers, re-enrolled providers, subcontractors, persons with an ownership/control interest, and agents/managing employees of any participating provider or subcontractor in its network are not excluded from the Medicaid program.
Healthcare providers can be barred from participation in the Medicaid program after a criminal conviction or as a result of fraud. State and federal laws require Managed Care Organizations to conduct routine checks of exclusion lists to identify any prohibited relationships with healthcare providers. If an excluded individual is identified, the relationship must be terminated immediately to prevent vulnerable patients from being placed at risk.
“New Yorkers should be able to trust that the doctors and health care providers their insurers use are properly licensed and will treat them responsibly,” said Attorney General James. “When companies fail to do their due diligence, patients are at risk of being treated by providers who may be unlicensed or unsafe. This settlement sends a clear message that insurers will be held accountable if they do not ensure those in their networks are legally allowed to treat vulnerable Medicaid patients.”
