New York State Comptroller Thomas D. DiNapoli releases audits

On January 24, 2023, following audits were issued by State Comptroller DiNapoli:

Click on the text highlighted in color to access the full text of the audit report. 

 

Department of Health: Medicaid Program – Improper Payments for Brand Name Drugs  (2020-S-62)

The audit identified $1.1 million in Medicaid overpayments for brand name prescription drugs where generic drugs were available but not substituted. In addition, the audit found $1 million in potential cost avoidance associated with 27,455 Medicaid fee-for-service claims for drugs that appear to be generic but were paid using brand name pricing methods. 

 

Department of Health: Medicaid Program – Claims Processing Activity October 1, 2021 Through March 31, 2022 (2021-S-28) 

OSC’s audit of Medicaid claims processing activity identified over $22 million in improper Medicaid payments for claims that were not processed in accordance with Medicaid requirements. About $9.9 million of the improper payments had been recovered by the end of the audit fieldwork. The audit also identified 11 Medicaid providers who were charged with or found guilty of crimes that violated laws or regulations governing certain health care programs. Upon being advised of the providers, the Department removed them from the Medicaid program. 

 

New York City Health and Hospitals Corporation: Controls Over Equipment (Follow-Up) (2022-F-19)

The initial audit, issued in January 2019, determined that the New York City Health and Hospitals Corporation’s (H+H’s) controls over its inventory of equipment needed improvement, as auditors found equipment tracking problems and record-keeping issues associated with relinquished, mass-retired, transferred and repaired assets. The follow-up found that H+H made some progress in addressing the issues identified. Of the six recommendations from the initial audit, H+H implemented two and partially implemented one; three recommendations were not implemented. 

 

Department of Civil Service: New York State Health Insurance Program – Payments by CVS Health for Pharmacy Services for Ineligible Members (Follow-Up) (2022-F-29)

The initial audit, issued in September 2021, found that nearly $30.7 million in pharmacy service claims were paid on behalf of ineligible members due to data transfer issues between the Civil Service and CVS systems and retroactive disenrollment of members. The follow-up found that Civil Service and CVS made progress addressing the issues identified in the initial audit; namely, Civil Service and CVS are working to develop a procedure for the recovery of these and future improper payments. Of the report’s six recommendations, two were implemented, three were partially implemented and one was no longer applicable. 

 

Department of Civil Service: New York State Health Insurance Program – Payments by UnitedHealthcare for Medical/Surgical Services for Ineligible Members (Follow-Up) (2022-F-30)

An audit issued in September 2021 found that United made a total of $5.7 million in improper payments for medical/surgical services on behalf of ineligible members. The follow-up found that Civil Service and United made significant progress in addressing the issues identified in the initial audit. United recovered about $500,000 of the $5.7 million in overpaid benefits originally identified, and Civil Service and United identified another $10.9 million in claims for ineligible members, of which about $4.9 million has been recovered. Of the initial report’s three audit recommendations, two were implemented and one was partially implemented. 

 

State Education Department: Oversight of Career and Technical Education Programs in New York State Schools (Follow-Up) (2022-F-17)

The initial audit, issued in December 2020, found that the department did not provide adequate oversight of CTE programs offered through the secondary school system to ensure they align with student goals and the needs of the State labor market – specifically, those occupations that are most in demand, fastest growing or highest salaried. Auditors also identified several common issues that are a deterrent to students’ enrollment in CTE and their successful completion of the program, further contributing to the lack of skilled employees in certain industries. The follow-up found that the department made limited progress in addressing the issues identified in the initial audit report. Of the initial report’s seven audit recommendations, three were implemented, one was partially implemented and three were not implemented. 

 

Department of Health: Improper Medicaid Payments for Misclassified Patient Discharges (Follow-Up) (2022-F-21)

The initial audit report, issued in August 2021, found the department did not have a process to identify and recover improper Medicaid payments for inpatient claims with incorrect patient status codes, resulting in $28 million in improper and questionable Medicaid payments for recipients who were reported as discharged from a hospital, but then admitted to a different hospital within 24 hours of the reported discharge (which often meets the definition of a transfer). The follow-up found that the department made some progress in addressing the problems identified in the initial audit report, but additional action is still required. Of the initial report’s four audit recommendations, one was implemented, two were partially implemented and one was not yet implemented.

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Second Circuit Court of Appeals certifies a question concerning the NYCHRL and NYSHRL to the New York Court of Appeals

The federal district court in this action concluded that the New York City Human Rights Law and the New York State Human Rights Law "impact requirement could not be met by a nonresident Plaintiff whose only asserted geographical connection was that she was denied a promotion to a position in New York City and State."  Plaintiff appealed.

Explaining that this case presents an unresolved question of New York Law, the United States Circuit Court of Appeals, Second Circuit, reserving decision, and certified the following question to the New York Court of Appeals:

Whether a nonresident plaintiff not yet employed in New York City or State satisfies the impact requirement of the New York City Human Rights Law or the New York State Human Rights Law if the plaintiff pleads and later proves that an employer deprived the plaintiff of a New York City- or State-based job opportunity on discriminatory grounds?

The Circuit Court also observed that the New York Court of Appeals was not limited to the question as stated hereinabove. Rather, said the Circuit Court, "the New York Court of Appeals may modify the certified question as it sees fit and may direct the parties to address other issues that it deems relevant to the circumstances presented in this appeal."

The Clerk of the Circuit Court was directed to transmit to the Clerk of the New York Court of Appeals "a copy of the Circuit Court's opinion and a complete set of briefs, appendices, and the record filed by the parties" in the Circuit Court of Appeals and noted that "this panel will retain jurisdiction to decide the case once we have had the benefit of the views of the New York Court of Appeals or once that court declines to accept certification."

Click HERE to access the Circuit Court's decision.

Selected recent quasi-judicial decisions issued by the Commissioner of Education

Issuing a Certification of Good Faith pursuant to Education Law §3811[1]

An Education Law §3811[1] Certification of Good Faith requested by a Respondent in connection with an appeal to the Commissioner of Education is issued solely for the purpose of authorizing a board of education to indemnify such a Respondent for costs incurred in defending himself* in a proceeding arising out of the exercise of the Respondent’s powers or the performance of the Respondent’s duties as a board member, officer, employee or other actor described in §3811(1) unless the record establishes that the particular individual requesting such a certification acted in bad faith. Click on the URL below to access this decision posted on the Internet.

http://www.counsel.nysed.gov/Decisions/volume62/d18201 

* §22 of New York State's General Construction Law, in pertinent part, provides that “Whenever words of the masculine or feminine gender appear in any law, rule or regulation, unless the sense of the sentence indicates otherwise, they shall be deemed to refer to both male or female persons.” Case summaries posted in NYPPL reflect this protocol.

School district officers and school district employees distinguished

The Petitioner in this Education Law §306 appeal sought the removal of the school district's records access officer [RAO]. Noting that the Commissioner of Education is authorized to remove “any trustee, member of a board of education, clerk, collector, treasurer, district superintendent, superintendent of schools or other school officer,” i.e.  an “elective or appointive officer in a school district whose duties generally relate to the administration of affairs connected with the public school system”,  the Commissioner explained that the RAO is not a “school officer” listed in §306(1) but rather a school district employee. Accordingly, the Commissioner of Education has no authority to remove the RAO from the position under color of §306(1). Although all public officers are public employees, not all public employees are public officers.

Click HERE to access this Decision of the Commissioner of Education

Discontinuing the services of a probationary teacher

The New York City Department of Education may discontinue the employment of a probationary teacher pursuant to Education Law §2573(1)(a) at any time and for any reason absent the teacher's establishing that "the termination was for a constitutionally impermissible purpose, violative of a statute, or done in bad faith”* (Matter of Frasier v Board of Educ. of City School Dist. of City of N.Y., 71 NY2d 763, 765 [1988]; see Education Law §§ 3012-c [1], 3012-d [9]; 8 NYCRR § 30-2.1 [b]; Kahn v New York City Dept. of Educ., 18 NY3d 457 [2012]; Appeal of H.H., 56 Ed Dept Rep, Decision No. 17,033; Appeal of Nicholaou-Guirguis, 32 id. 439, Decision No. 12,879).  The Commissioner has defined “bad faith” as “[d]ishonesty of belief, purpose, or motive” (Appeals of Prisinzano, 62 Ed Dept Rep, Decision No. 18,195, citing Black’s Law Dictionary [11th ed. 2019]). Click on the URL below to access this decision posted on the Internet:

http://www.counsel.nysed.gov/Decisions/volume62/d18212

* In contrast see http://www.counsel.nysed.gov/Decisions/volume62/d18211, reporting the decision of the Commissioner of Education in an appeal in which the Commissioner found that the record supported a finding that the educator's probationary appointment was discontinued in bad faith. 

Election of remedies

Petitioner’s originally commenced a proceeding pursuant to Article 78 of the Civil Practice Law and Rules in Supreme Court. Supreme Court dismissed the Article 78 proceeding based on the understanding that Petitioner would have an opportunity to pursue her claim via an Education Law §310 appeal to the Commissioner of Education. The court had deferred to the Commissioner of Education and denied the Article 78 petition "without prejudice to renew [the claim] before the Commissioner of Education.” The Commissioner ruled that "[given] this language, it would be inconsistent with the court’s decision to dismiss this Education Law §310 appeal based on an election of remedies [argument as the school district] successfully moved to dismiss the Article 78 petition on the ground of primary jurisdiction and filed its motion approximately four months after petitioner’s union declined to pursue a grievance." In the words of the Commissioner, the school district "... had the opportunity to move to dismiss the Article 78 petition based on election of remedies but chose not to do so" and declined to dismiss Petitioner's §310 appeal based on the school district's election of remedies argument at this stage of the dispute. Click on the URL below to access this decision posted on the Internet:

http://www.counsel.nysed.gov/Decisions/volume62/d18216

Banning an individual from school district property

Local school boards “exercise ultimate authority for access to students, school buildings and school property generally” (Matter of Lloyd v Grella, 83 NY2d 537, 547 [1994], rearg denied 83 NY2d 1001 [1994]).  School boards may impose reasonable restrictions on individuals’ access thereto (compare Appeal of Anonymous, 48 Ed Dept Rep 503, Decision No. 15,931 [reasonable restrictions upheld] and Appeal of Anonymous, 44 id. 260, Decision No. 15,167 [same] with Appeal of Anonymous, 48 id. 266, Decision No. 15,855 [“total ban” for indefinite period of time annulled]). Click on the URL below to access this decision posted on the Internet:

http://www.counsel.nysed.gov/Decisions/volume62/d18218

NYPPL's public personnel law handbooks

NYPPL's public personnel law handbooks, listed below, available for purchase from BookLocker, LLC.

The Discipline Book - A concise guide to disciplinary actions involving public officers and employees in New York State set out as an e-book. For more about this electronic handbook, click HERE. 

A Reasonable Disciplinary Penalty Under the Circumstances- The text of this publication focuses on determining an appropriate disciplinary penalty to be imposed on an employee in the public service in instances where the employee has been found guilty of misconduct or incompetence. For more information click HERE. 

Disability Benefits for fire, police and other public sector personnel - an e-book focusing on retirement for disability under the NYS Employees' Retirement System, the NYS Teachers' Retirement System, General Municipal Law Sections 207-a/207-c and similar statutes providing benefits to employees injured both "on-the-job" and "off-the-job." For more information about this e-book click HERE. 

The Layoff, Preferred List and Reinstatement Manual -This e-book reviews the relevant laws, rules and regulations, and selected court and administrative decisions. Click HERE for more information.

Selected judicial and quasi-judicial decisions issued during the week ending January 14, 2023

The Doctrine of Laches may bar granting an applicant workers' compensation benefits

Applying the doctrine of laches may be triggered within the context of a workers' compensation claim when a party is deemed guilty of the "failure to assert a right for an unreasonable and unexplained length of time, accompanied by other circumstances causing prejudice to the adverse party" (Matter of Fuller v Jackson, 205 AD3d 1291) and the Workers' Compensation Board's determination regarding the applicability of the laches doctrine "will not be disturbed on appeal if supported by substantial evidence" (Matter of Trombino v FMB Inc., 210 AD3d 1212. Click on the URL below to access this decision posted on the Internet:

https://www.nycourts.gov/reporter/3dseries/2023/2023_00138.htm

Governmental function immunity

A governmental entity is not entitled to governmental function immunity when engaged in a proprietary function at the time of an accident (see Wittorf v City of New York, 23 NY3d 473; Applewhite v Accuhealth, Inc., 21 NY3d 420). Nor is a governmental entitled to qualified immunity, in the absence of any evidence in the record that a study of the risks involved had been conducted (see Turturro v City of New York, 28 NY3d 469). Click on the URL below to access this decision posted on the Internet:

https://www.nycourts.gov/reporter/3dseries/2023/2023_00055.htm