POTSDAM – A Potsdam health services company will pay nearly half a million dollars in a settlement with the state over Medicaid overpayments.

Health Services of Northern New York, Inc., 56 Market St., received overpayments from Medicaid for personal care aide services and certified home health agency services between Jan. 1, 2005 and Dec. 31, 2012, according to an investigation and audit by the state Attorney General’s office’s Medicaid Fraud Control Unit.

The investigation found that Health Services had submitted incorrectly completed cost reports for the years 2003 to 2010, which affected the reimbursement rate it received from Medicaid.

Attorney General Eric T. Schneiderman announced Tuesday that his office has reached a settlement with Health Services whereby the downtown Potsdam firm paid back the Medicaid program $431,983.43 plus interest, for a total payment of $455,000.

“Whether intentional or not, I’m pleased that this ongoing issue was recognized and remedied on behalf of New York's most vulnerable populations,” Schneiderman said.

Health Services admitted that, as a result of submitting faulty cost reports, it received Medicaid payments in excess of the proper amount in the following categories: personal care aide services and certified home health agency services management fees for 2003 to 2006; personal care aide services allocated management fees for 2007 to 2010; certified home health agency services bad debt expenses for 2004 to 2006; and certified home health agency services transportation mileage costs for 2003 to 2006.

“My office remains vigilant in our fight to ensure that Medicaid dollars end up in the right hands, and with the cooperation of Health Services of New York, this money will be paid back and directed to its intended purpose – to better the lives of New York’s Medicaid beneficiaries.”

The matter was handled by Regional Director Ralph D. Tortora, III, of the Syracuse Office of the Medicaid Fraud Control Unit, under the supervision of Acting Director Amy Held and Executive Deputy Attorney General Kelly Donovan. The audit and investigation were conducted by Senior Auditor/Investigator Dejan Budimir and Senior Special Investigator Michael J. Ostuni.