DEPARTMENTAL APPEALS BOARD
Department of Health and Human Services
SUBJECT: New York State Department of Social Services
Docket No. 89-153
Decision No. 1114
DATE: November 7, 1989
DECISION
The New York State Department of Social Services (State) appealed a
determination by the Health Care Financing Administration (Agency)
disallowing federal financial participation (FFP) in the amount of
$5,971,484 claimed under title XIX of the Social Security Act for the
quarter ended March 31, 1987. The costs claimed represented amounts
originally paid under the State- funded medical assistance program which
the State later claimed as payments for individuals eligible for
Medicaid. The State's claim was made using statistical sampling
procedures, that is, the State estimated the amount paid to Medicaid
eligibles based on its review of the case records for a sample of
recipients of State- funded medical assistance. Some of the cases
involved individuals who were eligible for Medicaid on the basis of
disability, while other cases involved individuals who were eligible for
Medicaid on some other basis. Proceedings concerning the
non-disability-based claims are currently pending before the Board.
However, the State requested a summary decision upholding the
disallowance of the disability-based claims based on New York State
Dept. of Social Services, DAB No. 1012 (1989). Similar summary decisions
have already been issued by the Board. New York State Dept. of Social
Services, DAB No. 1052 (1989); New York State Dept. of Social Services,
DAB No. 1102 (1989).
In DAB No. 1012, the Board held that the State was not authorized to use
statistical sampling as a basis for claiming Medicaid funds payable on
behalf of disabled individuals. The Board found that sampling was
impermissible because it was used in lieu of making the disability
determinations which the regulations, reasonably interpreted, require in
each case for which payment is made. Accordingly, the Board sustained
the disallowances to the extent that they represented extrapolations
from cases in the sample involving individuals eligible for Medicaid
based on disability. The Board remanded that part of the disallowances
pertaining to the cases in the sample to determine whether the
disability determination in each case was properly made.
The Agency stated that it agreed to the issuance of a summary decision
here based on DAB No. 1012, but noted its position that the disallowance
could have been sustained on an alternative basis, i.e., that the
statistical sampling procedure used by the State was invalid. Letter
from Novinski to Settle dated 11/1/89. It is unnecessary to reach this
issue for purposes of this decision, however.
Conclusion
Accordingly, based on the analysis in DAB No. 1012, we uphold the
disallowance to the extent that it represents disability-based claims
calculated by extrapolation from a statistical sample. As in that
decision, we remand to the Agency that part of the disallowance which
pertains to the cases in the sample to determine whether the disability
determination in each case was properly made so that FFP is allowable.
1/ The State may appeal the Agency's determination in the sample cases
pursuant to 45 C.F.R. Part 16.
________________________ Donald F. Garrett
________________________ Alexander G. Teitz
________________________ Norval D. (John)
Settle Presiding Board Member
1. In some related cases now pending before the Board, the Agency
asserted, and the State did not dispute, that claims for the
expenditures made on behalf of the individuals in the sample cases were
not included in the amounts in dispute. Docket Nos. 89-51, 89-86 and
89-87, Agency's brief dated June 1, 1989, p. 5. If the same is true
here, there would of course be no need for further Agency