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Published on December 26, 2024
Legal Battles Challenge Gov. Hochul's Overhaul of NY Medicaid Home Care Program Amid ControversySource: Wikipedia/Metropolitan Transportation Authority, CC BY 2.0, via Wikimedia Commons

Governor Kathy Hochul's plan to consolidate New York's Medicaid-funded home care program is facing an array of legal challenges that could disrupt the proposed transition. The overhaul aims to bring the Consumer Directed Personal Assistance Program (CDPAP) under the administration of a single vendor, Georgia-based Public Partnerships LLC, a move that has stirred significant controversy. This transition is set to impact around 240,000 older New Yorkers and people with disabilities, as reported by Crain's New York.

However, Hochul's efforts to streamline the program by April 1 of next year are being challenged by a number of lawsuits filed by existing home care companies. According to Crain's New York, there are at least six lawsuits pending in state and federal courts. Critics of the consolidation argue that it not only jeopardizes services that many New Yorkers rely upon but also that it was preceded by a fraudulent bidding process and could result in the closure of nearly 700 fiscal intermediaries currently in operation.

In a recent lawsuit filed by a Rochester-based home care agency, All-American Homecare Agency, the plaintiffs contend that the bidding process favored Public Partnerships LLC, which they claim was evident through a job posting for a New York-based director by the company prior to being officially awarded the contract. The lawsuit raises alarms over potential "backdoor dealing" and suggests that the criteria were set up to benefit the out-of-state provider, as per the Times Union. Hermes Fernandez, an attorney with Bond, Schoeneck and King representing All-American, told the Times Union, "There’s no rational basis to favor an out-of-state provider over a New York provider." He added, "The New York providers didn’t have a fair chance."

The state government remains steadfast, despite the legal pushback. Gov. Hochul's office has signaled its intention to proceed with the transition as planned, potentially saving the Medicaid program an estimated $500 million annually. Sam Spokony, a Hochul spokesman, defended the transition in a statement obtained by the Times Union, "Our reforms will protect home care users and taxpayers by putting an end to years of runaway spending and fraud — and we look forward to delivering a stronger and more effective CDPAP as part of the transition that will take effect by April 2025."

As the lawsuits continue to accumulate, the future of the program remains uncertain. Senator Gustavo Rivera has introduced legislation to repeal the consolidation law and propose a new licensing framework, which could extend the timeline for program changes until 2026. While lawmakers continue their discussions and the courts deliberate, concerns from home care recipients and service providers persist as a key issue in New York's home care transformation.