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New York Lawyer Common Letitia James is dealing with renewed criticism from Republicans after the Trump administration suspended federal funding for the state’s Medicaid Fraud Management Unit (MFCU), citing years of poor felony enforcement efficiency and management choices that federal officers say left fraud investigations lagging.
The federal motion offers Republicans a brand new line of assault in opposition to James as she campaigns for reelection. Republican challenger Saritha Komatireddy has made the state’s struggling Medicaid Fraud Management Unit a key concern within the race, arguing James didn’t aggressively prosecute fraud. Federal watchdogs’ findings now lend new weight to these claims.
“Letitia James ran New York’s Medicaid Fraud Unit into the bottom, and now we all know why: a deliberate management option to open fewer circumstances and allow them to drag on for years,” Komatireddy stated in an announcement to Fox Information Digital. “This implies New York taxpayers are dropping their hard-earned cash to fraudsters, and sufferers and seniors are being damage or uncared for, and nobody is holding them accountable.”
The Republican Attorneys Common Affiliation additionally chimed in on the funding freeze, arguing it mirrored broader variations between Republican and Democratic attorneys normal in combating fraud.
“Whereas Republican Attorneys Common are aggressively combating fraud, waste, and abuse, Democrat AGs like Keith Ellison in Minnesota and Letitia James in New York knowingly support and abet scams and fraud of their states,” RAGA Govt Director Adam Piper stated in an announcement. “Republican AGs are thrilled to roll up our sleeves and work with JD Vance, Republican AG employees alum Andrew Ferguson, Scott Brady, and the White Home Job Pressure to avoid wasting taxpayers billions of {dollars} and ship most accountability.”
DR. OZ NAMES 5 STATES IN FRAUD CRACKDOWN AS TRUMP ADMIN TARGETS MEDICAID ABUSE
New York Lawyer Common GOP candidate Saritha Komatireddy blast AG James for failing to adequately examine and prosecute Medicaid fraud. ((Will Waldron/Albany Instances Union by way of Getty Photos) Will Waldron/Albany Instances Union by way of Getty Photos)
In a June 30 letter denying the unit’s annual recertification, Well being and Human Companies Workplace of Inspector Common (OIG) officers concluded that New York’s Medicaid Fraud Management Unit had turn out to be the lowest-performing large-state unit within the nation for felony Medicaid fraud enforcement regardless of receiving roughly $60 million yearly in federal funding and using greater than 270 employees members.
“The New York MFCU will not be successfully prosecuting felony Medicaid fraud,” the letter said. “The Unit reported solely 53 fraud convictions from 2023 to 2025. That is by far the bottom amongst similar-sized Items; the following lowest variety of reported fraud convictions for this era was 129.”
“Sufficient is sufficient,” the letter continued.
The report additionally discovered New York ranked final in felony indictments, securing fewer than 10 fraud indictments in 4 of the previous 5 years.
Federal officers additional discovered that 34% of the unit’s open circumstances have been greater than three years outdated, whereas 69% of referrals from the state’s Medicaid Program Integrity Unit had remained pending for a minimum of two years, contributing to a rising investigative backlog.
The HHS letter concluded that the unit’s poor efficiency stemmed largely from “a deliberate management alternative” to prioritize high-impact civil fraud circumstances over felony prosecutions, discovering that technique had left the workplace ineffective at pursuing felony Medicaid fraud regardless of its dimension and assets.
PENNSYLVANIA AG EXPLAINS WHY STATE LEADS NATION IN MEDICAID FRAUD CONVICTIONS WHILE OTHERS BATTLE MASS SCHEMES
New York Lawyer Common Letitia James attends a marketing campaign rally with group leaders within the Jackson Heights neighborhood within the Queens borough of New York Metropolis on Nov. 1, 2022. (AP Photograph/Eduardo Munoz Alvarez, File)
Whereas federal officers acknowledged the state’s fraud unit remained aggressive in civil recoveries, they stated these outcomes didn’t outweigh the decline in felony enforcement.
“The Unit has sacrificed its skill to successfully battle felony fraud to acquire civil recoveries which can be largely in step with its friends,” the report said.
James blasted the funding freeze, accusing the Trump administration of concentrating on New York for political causes.
“This administration’s unprecedented assault on New York is one other political distraction,” James stated in an announcement to Fox Information Digital. “Throughout my time as Lawyer Common, my workplace has recovered greater than $627 million for Medicaid and was acknowledged by this very administration for main the nation in anti-fraud efforts.”
James’ workplace famous that HHS highlighted New York as certainly one of 4 states liable for half of all civil recoveries nationwide in fiscal yr 2025. The lawyer normal additionally pointed to a number of current Medicaid fraud prosecutions, together with multimillion-dollar fraud circumstances introduced in current weeks.
“The one folks this resolution advantages are the criminals we examine daily,” James stated. “We’re contemplating all authorized choices to cease this outrageous motion.”
TRUMP SAYS ANTI-FRAUD EFFORTS ARE UNCOVERING BILLIONS IN WASTE, CLAIMS SAVINGS COULD BALANCE BUDGET
John Sarcone, the US lawyer for the Northern District of New York seems on. (Will Waldron/Albany Instances Union by way of Getty Photos)
In the meantime, federal prosecutors in New York stated they’re increasing efforts to analyze Medicaid fraud and affected person abuse.
“Lawyer Common James’ obvious incapability to clarify the New York MFCU’s indefensible felony enforcement efficiency will not be a political distraction as she places it,” First Assistant U.S. Lawyer John A. Sarcone III, who’s spearheading the revival of the NDNY Well being Care Fraud Job Pressure, stated in an announcement.
Sarcone famous that the New York MFCU averaged simply 9 felony indictments a yr between 2021 and 2025, in contrast with greater than 100 yearly in the course of the three years previous James’ tenure.
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“Public advantages fraud and Medicaid fraud didn’t abruptly cease in 2019,” Sarcone added. “As a substitute, underneath the failed management of AG James, felony Medicaid fraud in New York State has been ignored.”
The suspension took impact July 1 and stays in impact by way of Sept. 30 except New York completes a collection of corrective actions ordered by HHS, together with lowering case backlogs, rising felony indictments, and enhancing coordination with federal investigators. If these deficiencies usually are not corrected, the Workplace of Inspector Common warned New York it might lose its federal Medicaid Fraud Management Unit grant for fiscal yr 2027.
