ALBANY, N.Y., December 3 – Four health care facilities are under investigation by for submitting inflated insurance claims to the states Empire Plan, allegedly costing taxpayers $8 million, according to New York State Comptroller Thomas DiNapoli. The health care providers have been inappropriately waiving the out-of-pocket costs for medical services provided to state and local government employees, DiNapoli said.

The four health care providers audited are the Endoscopy Center of Long Island, Capital Region Ambulatory Surgery Center, Digestive Health Center of Huntington, and the Day-Op Center of Long Island for the period of January 2001 to December 2006.

These medical facilities engaged in abusive practices and inflated their bills, causing the state to incur significantly higher costs, DiNapoli said. These providers hurt taxpayers and must be held accountable for their actions. After only a handful of completed audits, I am very concerned about the abuse that we have found in this program. My office will continue to partner with the Department of Civil Service to ensure that taxpayers arent paying a dollar more than they should.

Auditors examined medical claims for the four ambulatory surgery centers, the largest in the state, to see if they were complying with reimbursement requirements under New York State Health Insurance Program (NYSHIP). The auditors found that the health care facilities routinely waived out-of-pocket costs and inappropriately billed United Health Care, the states insurance administrator.

Civil Service Commissioner Nancy G. Groenwegen said, Although the Civil Service Departments own audit staff have been responsible for the recovery of more than $24 million over the past two years, the systemic abuse revealed by these audits suggests that questionable if not fraudulent billing practices are much more prevalent than previously thought. It underscores the necessity for increased audit activity to ensure that taxpayer dollars are not wasted.

While Empire Plan members who were treated at these facilities saw physicians who participate in the Empire plan, the facilities do not participate in the plan, DiNapoli said. The Empire Plan members receiving services from the non-participating medical providers are subject to higher out-of-pocket costs, and the Empire Plan pays significantly more than it would have had the provider been a participant in the plan.

The health care providers then bill United Health Care and the state incurs the substantially higher costs for services. The auditors determined that the health care providers most likely waived the out-of-pocket fees because most Empire Plan members would seek a participating provider rather than pay additional fees.

The auditors determined that United Health Care would have paid at least 77 percent less for certain procedures had the individuals gone to participating providers rather than non-participating providers. The claims made by the providers did not indicate that the members out-of-pocket costs were waived, according to the audits.

The auditors recommend that United Health Care recover the $8 million from these providers and work with the Department of Civil Service to further prevent abuse of the system.