DOJ sues NY health officials over Medicaid home-care fraud

The U.S. Department of Justice has filed a civil lawsuit against New York state health officials and a private company, alleging a scheme to rig the bidding process for the state’s multibillion-dollar Medicaid home care program. The complaint, filed Tuesday in federal court in Brooklyn, names state Health Commissioner James McDonald, Medicaid Director Amir Bassiri, and the Georgia-based company Public Partnerships LLC (PPL).

Federal prosecutors accuse the state officials and PPL of engaging in a "sham bidding process" that effectively preselected PPL to take over New York’s Consumer Directed Personal Assistance Program (CDPAP). The program, which provides home care to more than 200,000 disabled New Yorkers, allows participants to hire their own caregivers, including family members, with Medicaid paying the aides. The Justice Department alleges that PPL created an artificially attractive proposal, made false statements about its communications with state officials, and, upon taking over the program in early 2025, improperly inflated hourly billable rates.

The lawsuit claims these actions allowed PPL to siphon millions of dollars in improper profits from the program, erasing...