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Suffolk seeks reimbursement of up to $15 million in Medicaid denials from state

The Suffolk County Legislature seal in the lobby

The Suffolk County Legislature seal in the lobby of the legislature building in Hauppauge, seen on Aug. 14, 2012. Credit: Newsday / Thomas A. Ferrara

Suffolk County has authorized the hiring of upstate attorneys to file claims and if necessary sue the state to recoup as much as $15 million in reimbursements for Medicaid payments for mentally disabled clients.

County Attorney Dennis Brown got approval Wednesday from the county waiver committee to retain the Albany law firm of Whiteman Osterman & Hanna, and Utica lawyer Nancy Rose Stormer. They already represent 24 other counties across the state, including Nassau and Westchester.

Nassau County Attorney Carnell Foskey said the county has submitted claims for about $2 million and is in the process of identifying and submitting more.

The efforts by the counties stem from the State Legislature's 2012 cutoff of extra aid for cases dating to before 2006. The aid is meant to help pay for high costs associated with the thousands of mentally ill patients who "overburdened" counties when they were deinstitutionalized.

The state since 1984 has reimbursed counties for their 25 percent share of Medicaid expenses for treating certain mentally disabled people identified as "overburden."

The state maintained the database, and in the 1990s dropped the codes identifying those considered as an overburden and stopped reimbursing counties for the cost. The lawsuits, which must be filed on a county-by-county basis, seek to recover the lost aid.

The law firms last month won a unanimous Appellate Division decision involving upstate St. Lawrence County. The ruling said the county can apply for rejected claims for six months from the date of the court decision.

"The 2012 amendment did not retroactively extinguish the petitioner's vested right to reimbursement," the court ruled. The appellate panel also decided to "deem six months to be a reasonable time" for the county to submit claims for reimbursements involving pre-2006 cases.

The state has filed a motion designed to get the Court of Appeals to consider the case.

"We are extremely pleased with the decision," said Christopher Buckey, who is of counsel to the Whiteman firm. But he said he could not assess the potential statewide impact until the Court of Appeals determines whether it will hear the case.

Brown said the attorneys have agreed to handle Suffolk's case for a contingency fee. The county will pay the law firms 36 percent of whatever they recover through the county suit.

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