Report Rips Attorney General’s Medicaid Fraud Unit Among Nation’s Worst

A new report has intensified criticism of New York Attorney General Letitia James’ handling of Medicaid fraud investigations, prompting renewed calls for probes into government-funded programs and nonprofit organizations that cost taxpayers billions.

Using federal Medicaid Fraud Control Unit data, the Empire Center for Public Policy, an Albany watchdog group, found New York ranked at or near the bottom nationally in several key enforcement categories. During James’ tenure from 2019 through 2025, New York ranked 49th in investigations per billion dollars of Medicaid spending and 51st in both indictments and convictions per billion dollars spent, the report states.

The center found that investigations by the Fraud Unit declined by roughly 50 percent between 2020 and 2025, compared with a 19 percent decline nationwide. It noted that New York’s criminal recoveries ranked 49th nationally when measured as a percentage of Medicaid spending during James’ tenure.

According to T. March Bell, the U.S. Department of Health and Human Services Inspector General, James’ Fraud Unit receives more than 2,000 patient abuse and neglect referrals a year, has a staff of more than 270 people, and oversees a $124 billion Medicaid program that covers 7 million people.

“Yet it has secured only one or two convictions in each of the last three years, and no more than five in any of the last six years,” Bell noted. “That outcome does not demonstrate that the unit is effective in investigating and prosecuting patient abuse and neglect cases.”

The report comes as the U.S. Department of Justice pursues a civil lawsuit alleging fraud involving New York’s Consumer Directed Personal Assistance Program, a multibillion-dollar Medicaid initiative. Federal prosecutors allege state health officials improperly awarded a major contract and allowed billing practices that potentially cost taxpayers billions of dollars. The allegations remain pending in federal court.

“It’s obvious that the taxpayers of New York are getting ripped off by the Medicaid program, and the attorney general does little about it,” said Assemblyman Joseph DeStefano, who previously called on James to investigate accounting irregularities at an Erie County nonprofit and take a look at other organizations. “We’ve heard nothing.”

State Conservative Party Chairman Gerard Kassar also weighed in, saying the Empire Center report validates longstanding concerns about the state’s oversight of Medicaid spending.

“We have been warning New Yorkers for months that billions of dollars in potential Medicaid fraud is occurring right under the nose of Governor Kathy Hochul and failed Attorney General Letitia James, whose office is doing virtually nothing to recoup staggering annual taxpayer losses,” Kassar said. “The respected Empire Center just found Ms. James’s Medicaid fraud unit to be the worst in America.”

Kassar added, “New Yorkers are being robbed blind, and their attorney general has turned a blind eye to them.”