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CMS Admits Error in Waste, Fraud, and Abuse Allegation
Last week, the Trump administration acknowledged a significant error in the data used to justify the fraud probe into New York's Medicaid program.
Last July, the federal Committee on Oversight and Government Reform sent Governor Hochul an initial letter accusing New York state of waste, fraud, and abuse, in part by “… failing to abide by the law and match federal Medicaid funds.” NYS Representatives Nick Langworthy and Mike Lawler were both signatories on the letter, which launced a full inquiry by The Centers for Medicare & Medicaid Services (CMS) in March.
On March 3, Centers for Medicare & Medicaid Services and House Committee on Energy and Commerce sent letters to Governor Hochul, accusing the state of Medicaid fraud. The following day, CMS Administrator Dr. Mehmet Oz publicly announced the investigation into New York's Medicaid program, and stated New York's federal Medicaid funding was at risk of deferral if the issues weren't resolved in 30 days.
Both Oz's video announcement and the CMS letter claimed that roughly five million New Yorkers receive personal care services, which assist people with basic life activities like bathing and meals. That equates to nearly three-quarters of the state's Medicaid enrollees, a level of utilization Oz described as "unheard of."
However, the actual number of New Yorkers receiving personal care services is a tenth of that – about 450,000 people, or between 6% and 7% of total enrollees
The error was initially noted on March 30 in a report by Michael Kinnucan, the health policy director of Albany-based Fiscal Policy Institute, which analyzed the math associated with the CMS claim. This analyisis was later supported in New York's 78-page response to CMS on April 3. Last week, the Trump administration acknowleged the error to the Associated Press.
In a show of support for Home-and-Community-Based Services (HCBS) and people with disabilities, Senators Schumer and Gillibrand joined nine US Senators in a March 26 letter to the Trump administration asserting that they "are not going after the real fraudsters. Instead, under the guise of 'program integrity,' you are cutting off vital funding for services that seniors, people with disabilities, and children rely on to survive and thrive in their communities.”
We have a vested interest in rooting out any waste, fraud or abuse in the Medicaid system, but as Federal activities around Medicaid unfold, we must combat misinformation, and remind our representatives their decisions should be informed, responsible, and made in the best interest of their constituents.
Federal Medicaid and Budget Advocacy Update
Congress is back from its two-week recess, and one of their major priorities is to fund the Department of Homeland Security (DHS), the only remaining FY 2026 funding bill that has not been enacted. Democrats have refused to provide the votes necessary to pass the bill unless it includes reforms to immigration enforcement. To get around this filibuster, Republican leadership plans to use a reconciliation bill to fund DHS. The same process, which requires fewer votes to pass, was used to enact PL 119-21, or the One Big Beautiful Bill.
It remains unclear if additional cuts to Medicaid or other basic needs programs will be included in the new reconciliation bill. However, recent remarks from Budget Chairman Arrington targeted Medicaid for additional savings. There has also been discussion about putting forward another reconciliation bill in the fall if healthcare cuts are not addressed.
On April 6, The Arc US and its national coalition partners for disability and aging sent a letter to the Appropriations leaders drafted by the Disability and Aging Collaborative, opposing further cuts to Medicaid in any form, including recent threats to freeze or withhold Medicaid funding. The Arc New York joined national, state, and local organizations in signing a letter to House and Senate leadership echoing these concerns, which generated over 350 signatures, including 55 chapters of The Arc!
Advocacy Response to President's Budget
The President's Budget for FY 2027 was published in early April. The proposal includes a $1.5 trillion (40-percent) boost to defense spending, and a 10-percent reduction in non-defense spending. The budget request for disability programs is similar to last year's request. However, funding for University Centers for Excellence in DD, Projects of National Significance, Voting Access, and several other programs are eliminated in the proposal.
The budget proposal for education slightly increases funding for the Individuals with Disabilities Education Act (IDEA) state grants, but preschool grants and all Part D programs, which provide funding to support neglected, delinquent, and at-risk students, are eliminated. Last year, Congress ignored the president's proposed education cuts, and we are hopeful it will do so again this year.
The Arc of the United States sent a letter opposing the cuts and is calling for advocates to share why public education matters to them. Take a moment to share your story about the value of public education here!
The Willowbrook Legacy and CSI Archives
The College of Staten Island (CSI) Willowbrook Taskforce is sponsoring a panel discussion on the expansion of the Disability History Archives on Tuesday, April 28 from 2:30-4:00 PM. The discussion will share how this new collection enhances the college's existing research archives. Located on the former grounds of Willowbrook State School, the CSI campus is and “ground zero” for Disability Justice. We are thrilled that The Arc New York Archives collection is now a part of this larger collection, supporting research, advocacy, and the preservation of disability history.
View the event flyer and register directly here.
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