NY Inspector General Charges 10 Companies with Work Comp/Medicaid Fraud

Liz Carey

‘Corridor of Corruption’

Albany, NY (WorkersCompensation.com) – Rides that were never given. Patient kickbacks. No workers’ compensation coverage for employees. False documents. They were all part of “the Northway corridor” in New York plagued by corruption, the NY Inspector General said this week. For Wednesday WorkersCompensation.com coverage of the topic, click here.

12 employees from 10 companies are under arrest following a two-year investigation by Inspector General Catherine Leahy Scott, and other state and federal offices, into what may amount to $8 million in fraudulent billings, and felony workers’ compensation charges.

Scott said the taxi and transportation companies allegedly failed to provide their employees with Workers’ Compensation coverage, billed Medicaid for trips that never happened, bribed Medicaid patients with kickbacks for using their companies, and filed false documents in order to provide services to Medicaid.

State police raided three convenience stores and a private home in the Ticonderoga area on Tuesday.

The arrested were: Anthony Armstrong, Khalid Chadder, Sanuallah Chadder, Khurram Gondal, Qaiser Gondal, Saleem Hayat, Muhammad Jahangir, Chaudary Kahn, Samone Marshall, Waqas Nauman, Mayam Qaiser and Tukk Simpson, who collectively face state and federal charges, including failure to provides workers’ compensation and providing false documentation in order to provide services to Medicaid.

The defendants were arraigned and held at the Essex County jail, some with bail set at $1 million.

Essex County District Attorney Kristy Sprague told the court that many of the defendants are flight risks — citing their personal wealth, as well as their frequent trips to Pakistan, where many of them are from. Sprague asked the Hon. Judge Richard Meyer to make the defendants hand over their travel documents, which he did.

Jeff Ferguson, an attorney representing the defendants during the arraignment, said many of his clients are devoted to their families — many of whom have young children — and have become naturalized U.S. citizens.

“The purpose of yesterday’s preceding was to do the arraignment, which is to set bail,” Ferguson said in an interview with WorkersCompensation.com. “My argument was that they are not a flight risk, because they are all U.S. citizens. Obviously, the court disagreed with me. Given the type of crimes they are alleged to have committed, and again these are only accusations at this point, I argued that the bail was excessive. Obviously, again, the court disagreed with me.”

Police said the ring operated in Crown Point, Keeseville, Port Henry, Ticonderoga and other communities along the I-85 corridor in Upstate New York.

According to the Sun Community News, community leaders in the area had complained to state authorities about the “cut-throat culture” in the medical taxi industry, where companies lured passengers with bribes and incentives, leaving taxpayers to foot the bill for trips up and down the Adirondack Highway.

In 2011, the state Dept. of Health (DOH) changed the way it handled medical transportation. The department contracted with Medical Answering Services (MAS) to serve as a dispatch center for medical transportation for Medicaid patients. Patients would call MAS, who would, in turn, dispatch vehicles in their network for transportation, allowing patients to specify which company they preferred, and to arrange for scheduled pick-ups.

The DOH then pays the companies with funds it receives from Medicaid.

According to the Sun Community News, the transportation companies would bribe patients with cigarettes and cash to place an order for a ride with MAS and request the taxi companies specifically. In some cases, the companies billed for round trip fares when they knew the patient was getting a ride back with someone else.

Authorities said in the criminal complaint that wiretaps of phone calls and text messages found that not only were the companies over-billing Medicaid, but that some of the trips never took place at all.

Companies involved in the alleged scheme include: Four-Way Taxi, Inc. in Ticanderoga; I-87 Transporters in Keeseville; Green Mountain Medical Transportation in Ticonderoga; Capital Cab Corporation in Queensbury and Ticonderoga; All NY Taxi and Limo, Inc. in Ticonderoga; Moriah Cab Service, Inc. in Port Henry; Adirondack Taxi & Limo in Ticonderoga; Ti Taxi, Inc. in Ticonderoga; Advantage Medical Transport in Ticonderoga; and Tukk Simpson DBA Crown Point Cab in Crown Point.

Sprague said the investigation was just starting.

“We’re just scratching the surface of what’s been filed,” Sprague said in court on Wednesday, according to the Sun Community News.

Ferguson said that it was still too early in the process to know what comes next and when.

“These are complex cases and I know several of the defendants failed to carry workers’ compensation as required by law, but I don’t know how that’s going to impact other charges or whether or not these charges will be tried separately,” he said. “Again, it’s just too early.”