New York State Comptroller audit reveals the State’s Health Department overpaid certain Medicaid Managed Care premiums

New York StateComptroller audit reveals the State’s Health Department overpaid certain Medicaid Managed Care premiums

Source: Office of the State Comptroller [Internet links highlighted in color]

The state Department of Health (DOH) overpaid managed care organizations nearly $19 million for the state fiscal year 2014-15, in part, because of a flaw in how it calculated premiums, according to an auditreleased on October 13, 2016 by New York State Comptroller Thomas P. DiNapoli. Auditors warned that another $56.8 million was at risk of overpayment over the next three years due to the flaw.

Additionally, DiNapoli’s auditors found DOH, because it had not provided sufficient cost reporting guidance, is missing out on millions in annual savings it is supposed to realize through reforms recommended by the state’s Medicaid Redesign Team. The department also failed to collect $38.6 million in actuarial costs, incurred since 2009, from managed care organizations (MCOs).

For the state fiscal year ended March 31, 2015, New York’s Medicaid program had approximately 7.1 million enrollees and Medicaid claim costs totaled about $53 billion. The federal government funded about 52 percent of New York’s Medicaid claim costs; the state funded about 30 percent; and localities funded the rest.

Most of New York’s Medicaid recipients receive their services through mainstream Medicaid managed care. Medicaid pays MCOs a monthly premium payment for each enrolled Medicaid recipient and the MCOs arrange for the recipients’ health services. Mainstream managed care provides hospital care, physician services, dental services, pharmacy benefits, and many others. Of the $53 billion in Medicaid costs, MCOs received $17.8 billion in mainstream managed care premiums for nearly 5.2 million Medicaid enrollees.

DiNapoli’s auditors found that the approximate $19 million in premium overpayments largely occurred because DOH incorrectly factored in the cost of certain taxes – a franchise tax imposed on insurance corporations and the Metropolitan Transportation Business Tax (MTA surcharge) – levied against for-profit MCOs into DOH’s rate-setting calculations. This resulted in higher premiums for all MCOs, including those MCOs that did not pay these taxes. In response to the audit, DOH officials told auditors they updated the methodology.

Auditors also reviewed the expenses submitted by one MCO to DOH and determined the MCO claimed certain non-allowable administrative expenses, which also contributed to the overpayments.

DOH’s cost reporting instructions failed to provide clear and specific instructions for reporting some expenses, such as fines and penalties and certain legal expenses. DOH also provided poor reporting guidance that allowed MCOs to misreport non-allowable marketing expenses, contrary to the intent of a policy change initiated from a Medicaid Redesign Team (MRT) proposal. As a result, DOH is not fully realizing the MRT’s estimated $45 million in annual savings from the change.

DiNapoli’s auditors also found that since October 2009, DOH has contracted with Mercer Health and Benefits, LLC to provide actuarial services and guidance in setting all managed care premium rates. As of January 2015, the total cost of the contract was $38.6 million. Under state law, DOH is required to charge the MCOs for those services, but had not done so.

DiNapoli recommended DOH:

1. Modify the rate-setting methodology to ensure that franchise taxes and MTA surcharges are properly factored into the methodology;

2. Determine the extent to which the MCOs’ reported expenses include non-allowable marketing expenses, and assess whether planned cost savings can be achieved under current MCO reporting practices;

3. Revise the Medicaid Managed Care Operating Report (MMCOR) instructions to ensure adequate guidance is given for reporting marketing and facilitated enrollment expenses, fines, and legal costs;

4. Recalculate the administrative cost cap and the base administrative premium rate based on the audit’s findings and apply the recalculations to the premiums paid for the state fiscal year 2014-15 and forward;

5. Recover overpayments;

6. Assess the cost of the current actuary contract, and any future contracts and amendments, to MCOs; and

7. Include MCOs in the future selection of the actuary.

Department officials generally concurred with some of the audit recommendations, and indicated that actions have been and will be taken to address them. DOH’s full response is included in the complete audit.

The complete report is posted on the Internet at: report

Employee’s misuse of employer’s email results in dismissal

Employee’s misuse of employer’s email results in dismissal
Posted by Employment Law News, WK WorkDay - A service provided by Wolters Kluwer Legal & Regulatory U.S.

[Internet links highlighted in color]

Fire Captain terminated after using Department’s internal email system to transmit religious messages

By Dave Strausfeld, J.D.

A fire department captain who was discharged for sending Christian messages to coworkers via the department’s internal email system was unable to prove that his First Amendment free speech rights were violated, held a Washington Court of Appeals, affirming a lower court’s grant of summary judgment. The email system was a nonpublic forum, and limiting its usage to fire department business was reasonable and viewpoint neutral. Judge Lawrence-Berrey filed a separate concurring opinion.

In dissent, Chief Judge Fearing argued the department had opened the email system to religious messages by forwarding newsletters from its health insurer about solving personal problems and living a healthy lifestyle, because the government may not “prefer secular chatter over religious oration” (Sprague v. Spokane Valley Fire Department).

The text of Mr. Strausfeld summary is posted on the Internet at:

http://www.employmentlawdaily.com/index.php/news/fired-for-using-internal-email-system-to-send-religious-messages-fire-captain-loses-free-speech-claim/?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+CCH-Workday+%28WK+WorkDay%29

Employee’s termination for sending 900 company emails to personal account did not constitute reverse discrimination

By Kathleen Kapusta, J.D.

Sending over 900 company emails to his personal or other outside account, including over 100 containing confidential client information, was a legitimate nondiscriminatory reason for firing a 59-year-old employee, notwithstanding that he was allowed to work at home on the company’s secure network and that an NLRB law judge found some of the employer’s confidentiality rules overbroad.

Accordingly a federal district court in Michigan granted summary judgment against his federal and state law reverse race and gender discrimination claims as well as his age bias claim under the ADEA. His FLSA claim for unpaid overtime also failed (MacEachern v. Quicken Loans, Inc., September 21, 2016, Steeh, G.).

The text of Ms. Kapusta’s summary is posted on the Internet at:

http://www.employmentlawdaily.com/index.php/news/employee-fired-for-sending-over-900-emails-to-personal-account-not-for-reverse-discrimination/?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+CCH-Workday+%28WK+WorkDay%29

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Other decisions addressing an employee’s alleged misuse of an employer’s electronic equipment include:

Fraser v Nationwide Mutual Insurance Co.

USDC, 135 F. Supp. 2d 623

The court held that an employee using his or her employer's computer equipment for personal business does not enjoy any "right to privacy" barring the employer’s reviewing the employee's e-mail that is stored in its computer system. Federal District Court Judge Anita B. Brody decided that an employer may peruse an employee's e-mail files that are stored in the system without violating either federal or Pennsylvania wiretap laws.

On appeal the USCA, Third Circuit, affirmed the District Court's grant of summary judgment in favor of Nationwide on Fraser's wrongful termination claim but vacated and remand the state claims, and his bad-faith claim and forfeiture-for-competition claim for consideration in light of the Pennsylvania Supreme Court's decision in Hess v. Gebhard and Co., Inc., 570 Pa. 148.

Leo Gustafson v Town of N. Castle, 

45 A.D.3d 766

The employee, an assistant building inspector with the Town of North Castle, was charged and found guilty of falsifying official records with respect to where he was while on duty. The individual was assigned a town vehicle for the purpose of making field inspections in connection with his employment. The vehicle had a global positioning system installed that transmitted information to the town’s computer reporting the vehicle’s location and movements. Based on this information, the Town charged the employee with falsifying town records as to his whereabouts. This, said the Appellate Division, constituted substantial evidence to support the determination that the employee was guilty of falsifying town records.

Ghita v Department of Education of the City of New York

2008 NY Slip Op 30706(U), Supreme Court, New York County, Docket Number: 0110481/2007 [Not selected for publications in the Official Reports]

The employee challenged an arbitrator’s determination terminating his employment with the New York City Department of Education after finding him guilty of downloading a file of pornographic material from his AOL email account and openly viewed such pornographic material from a school computer. Supreme Court rejected the individual’s claim that [1] the arbitrator exceeded his authority under Education Law §3020-a, and [2] the award terminating Ghita's employment is a violation of public policy and New York State Law.

Perry v Comm. of Labor,

App. Div. 3rd Dept., 283 A.D.2d 754

This unemployment insurance claimant challenged a determination by the Unemployment Insurance Appeals Board denying him benefits after finding that his employment was terminated due to his misconduct. The nature of the individual's alleged misconduct: his misuse of his employer's computer equipment. The employee, a human resource specialist, was terminated after his employer discovered that he used his computer terminal to frequently access pornographic websites during working hours.

Fraser v Nationwide Mutual Insurance Co.

USDC, 135 F. Supp. 2d 623

The court held that an employee using his or her employer's computer equipment for personal business does not enjoy any "right to privacy" barring the employer’s reviewing the employee's e-mail that is stored in its computer system. Federal District Court Judge Anita B. Brody decided that an employer may peruse an employee's e-mail files that are stored in the system without violating either federal or Pennsylvania wiretap laws.

As to the issue of the expectation of privacy, the appointing authority may wish to periodically advise its officers and employees that they have no right to privacy with respect to any data retrieved from the employer's computers, servers, video tapes, message tapes or other storage devices, electronic or otherwise.

The full text of the Wilkinson - Casey decision is posted on the Internet at:
http://nypublicpersonnellawarchives.blogspot.com/2008/06/searching-employers-computer-for.html

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A Reasonable Penalty Under The Circumstances - a 618-page volume focusing on New York State court and administrative decisions addressing an appropriate disciplinary penalty to be imposed on an employee in the public service found guilty of misconduct or incompetence. For more information click on http://booklocker.com/7401.html

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States and political subdivisions of states adopting “Ban the Box” laws prohibiting employers from inquiring into the criminal history of applicants on initial employment applications

States and political subdivisions of states adopting “Ban the Box” laws prohibiting employers from inquiring into the criminal history of applicants on initial employment applications

So-called “Ban the Box” legislation is being enacted by many public jurisdictions to eliminate the possibility of job candidates being disqualified from further consideration based on a criminal history that has been revealed in his or her initial application form.  Instead, legislation is being adopted to require that employers, public and private alike, consider the applicant’s qualifications for the position first and than subsequently make individualized inquiries into any criminal conviction and determine whether any such conviction relevant in making a decision with respect to the individual’s being selected for the job sought or to public safety.*

New York State Attorney General Schneiderman has stated that his office is committed to breaking down barriers that impede rehabilitation, especially those that prevent fair access to employment,” noting that several municipalities across New York State have enacted “Ban the Box” legislation. 

Although there is no statewide "ban the box" law in New York currently in effect,**  Article 23-A of New York State’s Correction Law mandates that both public and private employers be mindful of a number of specific factors when considering criminal history information during the hiring process in making an employment decision. 

The text of Article 23-A is posted on the Internet at:

http://www.labor.ny.gov/formsdocs/wp/correction-law-article-23a.pdf.

Consistent with Article 23-A, an employer may not deny employment because of an individual’s criminal history unless [1] it can draw a direct relationship between the applicant’s criminal record and the prospective job or [2] show that employing the applicant “would involve an unreasonable risk to property or to the safety or welfare of specific individuals or the general public.”

In the event the employer determines that such a direct relationship exists, an employer must evaluate the several Article 23-A factors listed below to determine whether the concerns presented by the relationship have been mitigated. If the potential employer determines that the concerns presented by the relationship have not been mitigated, it must then demonstrate how the factors combine to create an unreasonable risk.

The Buffalo “Ban the Box” Ordinance is posted on the Internet at:

http://www.hireimage.com/_resources/common/userfiles/file/Ban%20the%20Box%20Law%20Files/Buffalo%20Ban%20the%20Box.pdf

New York City’s Local Law to “Ban the Box” is posted on the Internet at:

http://legistar.council.nyc.gov/LegislationDetail.aspx?ID=1739365&GUID=EF70B69C-074A-4B8E-9D36-187C76BB1098

The Rochester “Ban the Box” Ordinance is posted on the Internet at:

http://www.hireimage.com/_resources/common/userfiles/file/Ban%20the%20Box%20Law%20Files/Rochester%20BTB.pdf

* The New York State Department of Civil Service’s examination application form NYS APP (6-16) includes the following statement and questions:

Certain job titles, including many law enforcement positions (such as Correction Officer, Parole Officer, and Park Patrol Officer) and direct patient care positions (such as Mental Health Therapy Aide and Secure Care Treatment Aide), are also subject to agency criminal history background investigations, as required by law. Applicants should read the official examination announcement for more specific information.

If you answer YES to any of these questions, please provide a detailed explanation in the REMARKS section provided below, including employer information, position, reasons and dates:

1. Yes [ ]  No [ ] Were you ever discharged from any employment except for lack of work, funds, disability or medical condition?

2. Yes [ ]  No [ ] Did you ever resign from any employment rather than face a dismissal?

3. Yes [ ]  No [ ] Did you ever receive a discharge from the Armed Forces of the United States which was not an “Honorable Discharge” or a “General Discharge under Honorable Conditions”?

REMARKS:

** The Article 23-A factors to be considered are:

1. That New York public policy encourages the licensure and employment of people with criminal records;

2. The specific duties and responsibilities of the prospective job;

3. The bearing, if any, of the person’s conviction history on her or his fitness or ability to perform one or more of the job’s duties or responsibilities;

4. The time that has elapsed since the occurrence of the events that led to the applicant’s criminal conviction, not the time since arrest or conviction;

5. The age of the applicant when the events that led to her or his conviction occurred, not the time since arrest or conviction;

6. The seriousness of the applicant’s conviction history; and

7. Any information produced by the applicant, or produced on the applicant’s behalf, regarding her or his rehabilitation or good conduct.

Disciplinary charges must be served on the target of the disciplinary action on or before the expiration of the period set by the controlling statute of limitations

Disciplinary charges must be served on the target of the disciplinary action on or before the expiration of the period set by the controlling statute of limitations

Lebron v Village of Spring Valley, 2016 NY Slip Op 06500, Appellate Division, Second Department

Following a disciplinary hearing, the hearing officer found David Lebron, a Village of Spring Valley police officer, guilty of certain charges of misconduct. The hearing officer than recommend that Lebron be terminated from his position with the Spring Valley Police Department. The Spring Valley Village Board of Trustees adopted the recommendation of the hearing officer and dismissed Lebron from his position.

Lebron file a petition pursuant to CPLR Article 78 challenging his termination, contending, among other things, that:

The Board's determination was not supported by substantial evidence.

Addressing the issue of the alleged lack of “substantial evidence,” the Appellate Division simply noted that the in brief submitted to the court Lebron “did not contend that the Board's determination was not supported by substantial evidence.”

The charges served against him were time-barred because they were served more than 60 days after the Department's Chief of Police became aware of the facts upon which the charges were based.

As to the question of the charges being timely served, the Appellate Division explained that the applicable statute of limitations are set out in The Rockland County Police Act, §7 of Chapter 526 of the Law of 1936. This section provides that the disciplinary charges must be served on the target of the disciplinary action within 60 days after the facts upon which the charges are based became known to the Village Board of Trustees. Here, said the court, there was no dispute that the charges were served upon Lebron within 60 days after the facts upon which the charges were based became known to the Board.

Accordingly, the court found that the disciplinary charges served on Lebron were not time-barred.

Lebron also argued that he had suffered “added stigma” as the result of the “circumstances of the disciplinary procedure.”  The Appellate Division, however, decided that this contention was without merit. In the words of the Appellate Division, “[n]othing in the record suggests that, as a result of the termination of his employment as a police officer with the Department, [Lebron] is prohibited from obtaining future law enforcement employment, or that he is subjected to a public registry of any sort.”

Lebron also contended that his due process rights were violated by the hearing officer's declining to reopen the disciplinary hearing to consider “newly discovered evidence.

Citing Russell v Del Castillo, 181 AD2d 680, the Appellate Division concluded that “the hearing officer providently exercised his discretion in denying [Lebron’s] application to reopen the hearing on the basis of newly discovered evidence."

The Russell decision is posted on the Internet at:

http://www.legal.com/decision/1992861181AD2d680_1486/MATTER%20OF%20RUSSELL%V%20DEL%20CASTILLO

The Lebron decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2016/2016_06500.htm

Evidence that the firefighter suffered disease or malfunction of the heart as the result of his or her duties and activities required to trigger the statutory presumption set out in the Volunteer Firefighters' Benefit Law

Evidence that the firefighter suffered disease or malfunction of the heart as the result of his or her duties and activities required to trigger the statutory presumption set out in the Volunteer Firefighters' Benefit Law

Huffer v Nesconset Fire Dist., 2016 NY Slip Op 06535, Appellate Division, Third Department

§61.1 of the  Volunteer Firefighters' Benefit Law provides that "[a] claim for benefits for the death or disability of a volunteer [firefighter] due to disease or malfunction of the heart or of one or more coronary arteries . . . shall not be denied provided the claimant introduces evidence which establishes that a volunteer [firefighter] suffered disease or malfunction of the heart or of one or more coronary arteries which caused the disablement or death of the volunteer [firefighter], and that such disease or malfunction resulted from the duties and activities in which the volunteer [firefighter] was engaged."*

Appeal from a decision of the Workers' Compensation Board, filed October 23, 2015, which ruled that decedent's death was not causally related to his employment and denied claimant's claim for workers' compensation death benefits.

Ross Huffer, [Huffer] served as a volunteer firefighter with the Nesconset Fire District and worked as a first responder on Wednesdays and Thursdays. On Wednesday, February 26, 2014, Hufferresponded to two calls during the day and also attended drill that evening at the firehouse. Huffer then returned home, went to bed and died in his sleep early the next morning of hypertensive and atherosclerotic heart disease.

Huffer’ widow, Kathleen Ross [Claimant], filed a claim for workers' compensation death benefits. Following a hearing, the Workers' Compensation Law Judge denied her claim, finding that there was insufficient evidence as to the nature and extent of  Huffers’ activities on February 26, 2014 to find that his death was related to his volunteer firefighter duties. The Workers' Compensation Board affirmed the decision of the Workers' Compensation Law Judge and Claimant appealed.

The Appellate Division, citing the provisions of §61.1 Volunteer Firefighters' Benefit Law, affirmed the Board’s determination, explaining that neither Claimant’s testimony nor the testimony of doctors established the duties and activities that  Huffer undertook during the two emergency calls or at drill on the day before he died.**

Claimant testified that she was unaware of the specific nature of the calls to which Huffer responded or the nature of the drill. In addition, said the court, “the record establishes that the opinion of Lester Ploss, a physician who reviewed [Huffer's] medical records and opined that [Ross’] firematic duties contributed to his death, was based upon a lack of information, as well as certain assumptions made by Ploss regarding the specific activities that [Huffer] engaged in at the emergency calls and at the drill.

Considering the lack of evidence regarding the duties and activities in which  Hufferhad been engaged, the Appellate Division held that the requirements for the applicability of “the statutory presumption under Volunteer Firefighters' Benefit Law [§61.1] was not met.”

Accordingly, the court ruled that “the Board's decision denying [Claimant’s] death benefit claim will not be disturbed.”

* N.B.As currently enacted §61 of the Volunteer Firefighters' Benefit Law is “repealed effective July 1, 2020.”

** The Appellate Division noted that “No testimony or evidence was provided concerning Ross’ “responding to two calls during the day and also attending drill that evening] by any fire department officials”

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2016/2016_06535.htm

Affordable Care Act Outreach for State and Local Governmental Employer Community

Affordable Care Act Outreach for State and Local Governmental Employer Community 

Source: The Internal Revenue Service

REMINDER

The Affordable Care Act [ACA] Office and the Tax Exempt and Government Entities [TE/GE] Counsel will present a live webinar to address governmental entities' concerns and needs as they relate to ACA information reporting requirements on Thursday, October 20, 2016 at 2 p.m. [Eastern time].

Topics to be addressed include:

Determining Applicable Large Employer (ALE) status

Identifying full-time employees

Defining hours of service

What is Minimum Essential Coverage?

E-Filing of information returns

2016 filing season corrections and replacements

Penalties and relief

TIN solicitation

Changes to forms and instructions for Tax Year 2016

Click here to Register for this event.

N.B. IRS is not offering participants Continuing Education Credit for this event.