The New York State Office of the Medicaid Inspector General (“OMIG”) issued final regulations on December 28, 2022, overhauling the mandatory compliance program requirements imposed on certain Medicaid providers, including Article 28 and Article 36 entities, as well as those that bill or order at least $1,000,000 in Medicaid reimbursable services in any given year (up from the previous threshold of $500,000).  In addition, in late January 2023, OMIG released guidance on what the agency will be looking for, when assessing whether providers are in compliance with the new rules (both linked below).  Enforcement of these new regulations will commence on March 28, 2023.

Notably, the guidance highlights the penalties, including but not limited to financial, for providers that fail to satisfy the new requirements.  Among these requirements, the new regulations make having an “effective” compliance program a “condition of payment," meaning that a provider’s receipt of Medicaid reimbursement could be jeopardized if OMIG finds that its program is not “effective."  A provider may also be subject to monetary penalties of up to $5,000 for each month during which provider failed to adopt, implement, and maintain an effective compliance program - an amount which increases to $10,000 per month with a second violation. OMIG may also recoup monies paid to the provider, terminate the provider’s enrollment in the Medicaid program, or impose sanctions, such as exclusion from the Medicaid program.  

The new regulations require significant changes to providers’ existing compliance programs, call upon providers to focus on measuring “effectiveness” and mandate annual effectiveness evaluations.  

18 NYCRR Part 521 Fraud, Waste and Abuse Prevention - Effective Date: 12/28/2022

Compliance Program Guidance with Addendums A and B_0 (3).pdf