Bus-ted! Attorney General unveils major Medicaid fraud investigation targeting transportation companies

State Attorney General Letitia James said Wednesday that her office uncovered at least 55 transportation companies across the state have been billing Medicaid for non-existent rides, resulting in an estimated loss of tens of millions of dollars each year to New York taxpayers.

The investigation, which has spanned several months, identified that many companies inflated the mileage of their trips or even billed for rides that never happened.

Some companies went so far as to offer kickbacks to patients suffering from substance use disorders, effectively recruiting them into fraudulent schemes in exchange for cash incentives.

“This fraud is very simple,” James said. “Transportation companies are billing Medicaid for fake rides and tolls, costing New York taxpayers tens of millions of dollars every year. Money that should be used to fund health care for the most vulnerable New Yorkers.”

James stressed the serious nature of this fraud, highlighting how these fraudulent actions cost taxpayers and put vulnerable populations at risk.

“Not only is it the theft of taxpayers’ dollars, it exploits low-income individuals who are already in vulnerable positions,” she said. 

Recent enforcement actions from the Attorney General’s office include shutting down multiple companies in Saratoga and Wensom counties that were found to be employing fake billing practices.

In total, 55 additional transportation companies were identified as being involved in fraudulent billing schemes, prompting the issuance of cease-and-desist letters, warning them of potential legal action and severe consequences.

“We are putting these companies and the entire medical transportation industry on notice,” James said. “If they do not immediately stop their fraudulent activities, they will face serious consequences, including prison time and steep financial penalties for their actions.”

The Office of the Attorney General has already achieved some notable victories in its crackdown on fraud, recovering millions of dollars and prosecuting individuals responsible for these schemes.

In addition to the cease and desist notices, Attorney General James announced four new settlements with transportation companies for violations of Medicaid transportation rules that will return over $847,000 to the state.

“Fraud stops when bad actors know they will be caught stealing from New Yorkers,” she said, vowing to continue the investigation and prosecution of those who profit from corruption in the healthcare system.

As New York approaches the upcoming legislative session, James indicated that her office would work closely with lawmakers and the governor to seek reforms that would help curb such fraud in the future.

“Our investigations have sent offenders to prison and recovered millions of dollars for the state, and we will continue our efforts to protect Medicaid and ensure that resources are utilized for the health care needs of New Yorkers,” the Attorney General said.

For ongoing updates on this investigation and resources available for patients and providers, New Yorkers are encouraged to visit the Attorney General’s official website, ag.ny.gov.