By Hank Russell
The recent lawsuit filed against Governor Kathy Hochul by the federal government over claims of Medicaid fraud shows that the governor is “stealing” from “our most vulnerable,” according to her opponent.
Nassau County Executive Bruce Blakeman blasted Hochul for her out-of-control spending, especially when it came to Medicaid funding, which is why the Department of Health is suing her. According to Blakeman, Hochul spent $286 million on what he said was a no-bid contract and $11 billion in giveaways to the home care system.
“Every dollar stolen by Hochul’s administrative fraud is a dollar that should have gone to caring for patients,” Blakeman said. “It is absolutely disgusting that Kathy Hochul uses programs meant to help our most vulnerable neighbors to reward political insiders.”
On June 16, the U.S. Justice Department filed a lawsuit in the U.S. District Court for the Eastern District of New York against the State of New York Department of Health, New York State Medicaid Director Amir Bassiri, and Public Partnerships LLC (PPL), an Alpharetta, Georgia-based company that has managed New York’s Consumer Directed Personal Assistant Program (CDPAP) since 2025.
According to the Justice Department, the lawsuit aims to stop an alleged fraud scheme by which PPL has generated millions of dollars in unauthorized profits funded by federal taxpayers in connection with its takeover of New York’s $10 billion CDPAP program. The lawsuit alleges that the state Health Department awarded PPL the lucrative CDPAP contract after conducting a sham bid process, and then, despite learning of PPL’s intent to deviate from the representations made in its bid and violate the financial terms of the contract, failed to take action to hold PPL accountable and to protect public funds from misuse, resulting in a fraud scheme that remains unchecked to this day.
The lawsuit also seeks to prevent all defendants from making further misrepresentations about the CDPAP program and from charging American taxpayers millions of dollars unauthorized by the contract.
CDPAP is a Medicaid program that provides home care through lay caregivers to Medicaid patients with disabilities or significant medical needs. In spring 2024, the New York Legislature passed a statute that consolidated the management of CDPAP from hundreds of pre-existing “fiscal intermediaries” to a single fiscal intermediary, setting up one of the most lucrative contracts for administering a Medicaid program in the nation.
“New York’s backroom deal with PPL has cost taxpayers millions of dollars and cast countless Medicaid patients to the curb,” said Assistant Attorney General Colin M. McDonald for the Justice Department’s National Fraud Enforcement Division. “Today’s action is the latest reminder that the Justice Department is mobilizing every available tool to protect taxpayer-funded programs from fraud and corruption.”
“New York’s failure to police a favored vendor that unlawfully siphoned millions of dollars of Medicaid funding is egregious and betrays the public trust,” said Assistant Attorney General Brett A. Shumate of the Justice Department’s Civil Division. “The Justice Department is acting to ensure that federal laws regarding truthful statements and fair dealing in federal health care programs are upheld and to prevent additional harm from being exacted against the public by Public Partnerships LLC and New York.”
“New Yorkers are paying the price for Hochul’s corruption with the highest taxes in the nation and a worsening affordability crisis,” Blakeman said. “As governor, I will audit Medicaid, end the pay-to-play corruption, and make sure taxpayer dollars go to patients — not political donors.”
But Ryan Radulovacki, a spokesperson for Hochul’s campaign, said Blakeman has had his share of scandals when it comes to healthcare institutions and programs. “New Yorkers should be clear on the facts: Bruce Blakeman promised to gut Medicaid just like Donald Trump, and he ran Long Island’s vital safety net hospital into the ground alongside his corrupt cronies,” he said, referencing the controversy surrounding Blakeman and the Nassau University Medical Center. “Just like Trump, if Blakeman is looking for waste, fraud, and corruption, he can find it in his own backyard.”
A Hochul spokesperson called the lawsuit “just another sad attempt by the Trump administration to weaponize the justice system to attack political opponents in an election year. New York’s decision to move to a single fiscal intermediary has already saved taxpayers more than a billion dollars while deterring fraud, waste and abuse. As many courts have already held, the transition to a single fiscal intermediary was lawful and appropriate. We are confident the facts are on our side.”
But Bill Hammond, the senior fellow on health policy for the Empire Center for Public Policy, urged “anyone inclined to shrug off the lawsuit as a political hit — as Hochul has tried to do — should read the evidence first,” he wrote in his analysis of the case. He also imparted some advice to Hochul.
“As she seeks re-election in November, Hochul faces a choice: She can take her chances trying to defend this undeniably ugly set of facts in court — and on the campaign trail,” Hammond wrote. “Or she can admit mistakes, clean house, order a new bidding process — and recommit to fighting fraud instead of condoning it.