• What Happened: The DOJ is set to file a formal complaint in the coming weeks against Gov. Kathy Hochul's administration and Public Partnerships LLC over the allegedly rigged overhaul of New York's $11 billion CDPAP Medicaid homecare program, targeting bid rigging and Medicaid billing violations.
  • Why It Matters: Damning emails show Hochul's top health officials were coordinating with PPL on implementation details two weeks before state lawmakers even authorized the bidding process, and a PPL rep who denied any pre-bid contact with the state later retracted that statement under oath.
  • Bottom Line: Hochul's office is claiming $1 billion in savings from the overhaul but hasn't produced a single document to back it up, while Medicaid spending in New York is still projected to grow 11% this year.

New York's Medicaid corruption scandal just went federal.

The Department of Justice is set to file a formal complaint in the coming weeks against Gov. Kathy Hochul's administration and the company at the center of New York's $11 billion homecare program overhaul, according to three sources familiar with the DOJ's investigation, The New York Post reported Wednesday.

The probe targets the state's handling of the Consumer Directed Personal Assistance Program, or CDPAP, which allows elderly and disabled New Yorkers to hire family members as paid caregivers. When Hochul overhauled the program in 2024, she consolidated payroll services from hundreds of middlemen firms into one company: Georgia-based Public Partnerships LLC, or PPL, which landed a $1 billion contract. The DOJ is expected to target both Hochul's administration and PPL, with potential accusations including bid rigging and non-compliance with Medicaid billing rules.

The smoking gun is a trail of emails. The Empire Center for Public Policy unearthed correspondence showing top officials at the state Department of Health and in Hochul's office were already hashing out implementation details with PPL employees two weeks before state lawmakers had even authorized soliciting contract bids. Medicaid Director Amir Bassiri and Chief Operating Officer Amanda Lothrop were both recipients of those emails. Bassiri would later be one of the officials who scored the contract bids. Hochul's deputy secretary for health, Angela Profeta, was also looped in.

Making matters worse, a PPL representative told state lawmakers at a blockbuster hearing in August that the company had no conversations with Hochul's administration before submitting its proposal. She later retracted that statement.

The DOJ had already signaled its direction. In a June court filing, Patrick Runkle, assistant director of the DOJ's Consumer Affairs branch, confirmed his team was probing whether the rushed timeline forcing aides and patients onto PPL violated consumer protection statutes.

This comes just one day after CMS Administrator Dr. Mehmet Oz sent Hochul a pointed 50-question letter demanding answers about waste, fraud, and abuse inside New York's $124 billion Medicaid program.

Hochul's office declined to address the looming lawsuit, instead offering that the governor had been "leading efforts to root out waste, fraud and abuse" in Medicaid. Her budget office claims the CDPAP overhaul saved $1 billion but has not provided a single document to support that figure. New York's overall Medicaid spending is still projected to grow 11% this year.

New York's corruption house isn't just cracking. The feds are about to kick in the door.