New York proposes biometric IDs to combat Medicaid fraud

New York lawmakers are currently considering a bill that is aimed at reducing Medicaid fraud by requiring all patients to carry biometric ID cards.

Under the proposed law, introduced by Republican Senator Mike Ranzenhofer, all Medicaid recipients would receive a special card that contains their biometric data from a palm scan that must be presented to receive service.

A similar bill was introduced several weeks earlier in the lower legislative chamber by Democratic Assemblywoman Naomi Rivera.

Supporters of the plan say that the biometric ID cards could save the state billions of dollars by making it harder for people to defraud the system.

Under the program, Medicaid recipients would receive the card in the mail and activate it with an initial palm scan. The card would then be presented whenever a patient receives medical care or purchases prescription drugs at hospitals and pharmacies, which would be equipped with card readers to verify the individual’s identity.

The cards would also record the number of medical visits and prescription drugs purchased to help the Office of the Medicaid Inspector General, the New York Attorney General’s office, and the Department of Health determine if any patient was overusing prescription drugs or had an unrealistic number of patient visits in a day.

Rivera said that New York currently has “a system of ‘pay and chase’ that allows mass and wide-scale fraud to occur, then we investigate, prosecute and try to recover the stolen money.”

Offering several examples of fraud, Rivera said, “A dentist that bills for 900 procedures in one day. Pharmacies filling prescriptions without a doctor’s authorization. A medical equipment company billing for millions in bogus claims. A Medicaid recipient receiving hundreds of thousands in services from a county where he has not resided for years. Cases go on and on.”

According to Rivera, installing the card readers and issuing the identity cards would cost an estimated $20 million, but could result in as much as a $5 billion reduction in Medicaid fraud each year.

Senator Ranzenhofer is enthusiastic about the proposed bill’s potential cost savings.

“The savings are going to be extraordinary,” he said.

The legislation could set off a debate about privacy concerns, but the New York Civil Liberties Union (NYCLU) has yet to issue a statement.

NYCLU says that it is currently reviewing the proposal and will comment later.

Ranzenhofer sought to ease privacy concerns by assuring that information would not be stored in a central registry and sensitive data like Social Security numbers would not be recorded. He also believes that these cards do not violate an individual’s privacy in any way.

“With new technology, this is the type of fraud prevention that the public has come to accept. This is not an unreasonable intrusion into someone’s privacy,” he said.

Prior to the proposed bill, Medicaid recipients were required to use a fingerprint scan before they could receive services, but in 2009, then Governor Paterson repealed the law to help eligible children and adults keep their Medicaid coverage.

Critics of more stringent verification processes for Medicaid say that these measures demonize low-income citizens.