Scandal Erupts in Hochul’s Medicaid Homecare Program
ALBANY – A staff member from the company closely associated with Governor Kathy Hochul’s troubled Medicaid homecare initiative is accused of embezzling funds from a significant number of program participants.
The employee of Public Partnerships, LLC (PPL)—selected by Hochul’s administration as the exclusive payment intermediary for the Consumer Directed Personal Assistance Program—allegedly falsified direct-deposit information for as many as 10,000 participants, according to anonymous sources.
The New York Medicaid program is designed to provide funding for individuals to care for elderly or disabled family members. Recently, the state engaged PPL to streamline payment processing by reducing the number of middleman companies involved.
Last week, PPL uncovered that an employee was misdirecting paychecks meant for homecare participants to fake bank accounts, some of which were reportedly located overseas.
"One of the agents who handled phone inquiries was terminated last week for directing direct deposits to incorrect accounts, including offshore accounts," a PPL employee informed The Post.
The FBI is reportedly involved, although a representative from the agency said they could not confirm any ongoing investigation when contacted by The Post on Tuesday.
While it remains unclear how many personal assistants have been affected by this incident, estimates place the number at potentially over 10,000. The duration of the fraudulent activities and the exact financial losses incurred, which may be in the hundreds of thousands of dollars since PPL began disbursing payments in April, are still unknown.
"This situation just keeps deteriorating," a PPL staffer commented regarding the ongoing turmoil associated with Hochul’s efforts to consolidate numerous payroll middlemen under a single provider.
A PPL spokesperson acknowledged to The Post that an employee had been "terminated for failing to adhere to approved procedures" and is now under "investigation," but offered no additional comment, including a denial of the allegations.
The governor’s office has not provided any remarks concerning the accusations of fund misappropriation into fraudulent accounts.
The alleged embezzlement is the latest in a series of scandals affecting the Medicaid homecare program.
Previously, PPL encountered issues related to a phishing scam that utilized counterfeit Google Ads to deceive participants into revealing personal information, although the firm maintains that its systems remain uncompromised.
"We have confirmed that fewer than 100 personal assistants among over 225,000 across New York State fell victim to this scam. We will ensure that every affected PA is reimbursed for any lost wages," PPL stated.
According to Hochul’s office, PPL informed the state about the phishing incident, suggesting that the consolidation into one firm is yielding positive results.
"When PPL flagged a recent phishing scam, the State ensured that proper action was taken," said Hochul spokesperson Sam Spokony, addressing the situation in a statement.
This immediate response, he added, would not have been feasible under the previous system plagued by numerous intermediary firms.
However, Hochul remains under scrutiny from critics across the political spectrum, with allegations that the state rigged the bidding process for PPL and pushed through the transition on an unrealistic schedule, among other concerns.
The Post has previously reported that experienced prosecutors from the DOJ’s Consumer Affairs Branch are examining PPL and the CDPAP transition closely.
Earlier in the month, the state reached a legal agreement with the New York Legal Assistance group to extend the registration deadline for participants to connect with the new firm.
Insiders within the company suggest that PPL’s president, Maria Perrin, may be taking the blame for the lapses after she announced her impending resignation over the weekend.
"It seems they needed a scapegoat, and Maria was the one available," remarked a staff member.
A representative for the company refuted any connection between Perrin’s resignation and the data breaches.
Perrin’s exit follows a wave of leadership changes within the private-equity-owned firm. Recently, CEO Vince Coppola also stepped down, as reported by the Albany Times Union.
Sources within PPL informed The Post that Executive Vice President Vicente Armendariz, who played a key role in the New York transition, resigned within the last month.
The company representative declined to comment on Armendariz’s departure.
"As the CDPAP transition approaches completion and the operation stabilizes, Maria believes PPL will be poised for success following her exit in the fall," stated a PPL spokesperson.
Both the governor’s office and the state Department of Health have been defending PPL for months, asserting that as of May 15, 98% of the 198,000 fully onboarded CDPAP assistants had submitted timecards and received payment.
Nonetheless, Ilana Berger, political director of Caring Majority Rising, a group advocating against the transition, slammed the situation in a harsh statement. “This breach and leadership turmoil clearly indicate that PPL is in disarray.”
"A competent organization would have had preventive measures ready for a security crisis like this. Instead, PPL has exacerbated an already troubling situation, leaving workers and consumers who rely on CDPAP bewildered. This serves as yet another glaring indicator that PPL is unqualified for the task.”
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