Attorney General Letitia James announced a sweeping crackdown on Medicaid fraud by medical transportation companies, issuing cease and desist notices to 54 providers across New York State. The notices warn of severe financial and criminal penalties if the companies continue fraudulent billing practices that exploit Medicaid funds and put vulnerable patients at risk.
The move is part of an ongoing investigation by the Attorney General’s Medicaid Fraud Control Unit (MFCU), which has already secured over $10 million in recovered funds and resulted in criminal convictions for 11 individuals involved in fraudulent schemes. Four additional transportation companies have recently reached settlements totaling over $847,000.
“Companies that illegally profit by exploiting Medicaid patients steal taxpayer money and undermine the health care system that all New Yorkers rely on,” said Attorney General James. “Today I am putting the entire medical transportation industry on notice to stop these schemes that take advantage of vulnerable New Yorkers and steal critical funds intended to provide health care to those in need.”
The fraud schemes investigated by MFCU include billing Medicaid for fake trips, inflating mileage costs, falsifying toll charges, and using unlicensed drivers. In some instances, companies have paid kickbacks to Medicaid recipients in exchange for requesting transportation services, further endangering vulnerable populations, including those seeking substance abuse treatment.
Attorney General James highlighted recent settlements with four companies:
- City Service Transportation, Inc. (Erie County) will repay $373,216.
- AJ Medical Transportation Co. (Albany County) will repay $350,000.
- Safe Ride of WNY, Inc. (Erie County) and owner Robert Sapienza will repay over $66,000.
- Half Moon Medical Transportation, Inc. (Saratoga County) will repay $58,000.
These settlements add to a growing list of successful prosecutions. In recent years, MFCU secured over $4.4 million in restitution from multiple transportation companies involved in fake billing and kickback schemes. Convictions have also resulted in prison sentences for key players in fraudulent operations across the state.
State agencies, including the Department of Health, Office of the Medicaid Inspector General, and Medical Answering Services LLC, played critical roles in supporting the investigations.
New measures will continue to target fraudulent practices aggressively, with Attorney General James promising full enforcement of state and federal laws. Medicaid providers who knowingly violate regulations face civil and criminal penalties, including prison time and substantial financial repayments.
“Medicaid transportation is a critical service for many New Yorkers who rely on it for life-saving medical appointments,” James said. “These dishonest companies not only abuse taxpayer dollars but also jeopardize the health and safety of patients. This will not be tolerated.”
Individuals with information about Medicaid provider fraud or abuse in nursing homes are encouraged to file confidential complaints online or contact the MFCU hotline at (800) 771-7755.
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