NOVEMBER 28, 2018

ANALYSIS OF SELECTED ERIE COUNTY
MEDICAID DATA
JANUARY 2018 - SEPTEMBER 2018 AND SELECTED PRIOR
PERIODS

ERIE COUNTY OFFICE OF THE MEDICAID INSPECTOR GENERAL
MICHAEL R. SZUKALA, MBA, CIA
ERIE COUNTY MEDICAID INSPECTOR GENERAL

 ERIE COUNTY OFFICE OF THE MEDICAID INSPECTOR GENERAL
95 FRANKLIN STREET, ROOM 802
BUFFALO, NEW YORK 14202

November 28, 2018
Hon. Mark C. Poloncarz, Esq.
Erie County Executive
95 Franklin Street, 16th Floor
Buffalo, New York 14202
Dear County Executive Poloncarz:
Since 2013, The Office of the Medicaid Inspector General for Erie County (“MIG Team”) has
met with you1 to discuss Medicaid issues raised with you by citizens of Erie County. You have
met with the MIG Team on several occasions and asked that the team follow-up on certain
questions brought up in those discussions. You also instructed that we develop a report to answer
those questions discussed and provide what we believe to be valuable Erie County Medicaid data
to County decision-makers and County residents. This is that document.
In May 2013, after approval from the New York State Office of Medicaid Inspector General
(“OMIG”), the MIG Team received training on and access to New York State’s Medicaid Data
Warehouse (“MDW”). The software used to access the MDW is provided by the Salient
Management Company (“SALIENT”). The MDW contains the individual transaction records
for all Medicaid claims data in New York State, although the MIG Team only has access to data
for Erie County recipients. The MIG Team has complete access to all Medicaid claims data in
Erie County on a real-time basis.
This database is covered by the legal and regulatory provisions of the Health Insurance
Portability and Accountability Act (“HIPAA”). Much of the data is confidential in nature and
cannot be released under this federal law. However, amalgamations of data are allowed as long
as individual privacy is not breached.
This report is reviewed by the New York State Department of Health. As a condition of its
release, we include the following disclaimer:
“The views and opinions expressed in this publication are those of the author(s)
and do not necessarily reflect the official policy or position of the New York State
Department of Health. Examples of Analysis performed within this publication
are only examples. They should not be utilized in real-world analytic products.”
1 In this document, “you” and “your” refer to the County Executive. “We” and “our” and “us”
refer to the MIG Team.

 MEDICAID INSPECTOR GENERAL FOR ERIE COUNTY
Since September 1, 2012, operating under agreements with OMIG, the MIG Team has completed
or is in the process of completing forty-one (41) audits. These audits cover more than $99
million in Medicaid payments. The results of those audits have been submitted to OMIG, as per
the agreements, for follow-up and action by the State.
As of July 1, 2018, we are trained and authorized to perform audits on the following types of
Medicaid vendors:
o
o
o
o
o
o

Ambulette Transportation
Assisted Living Programs
Durable Medical Equipment
Long-Term Home Healthcare
Pharmacy
Taxi Transportation

The MIG Team continues to work on a variety of projects and cooperate with OMIG and law
enforcement agencies as required and/or necessary. Under the County’s agreements with OMIG
and other State agencies, the MIG Team is restricted from commenting on ongoing or recently
completed Medicaid audits while OMIG reviews the results and considers State action.
The MIG Team, which features three employees, is funded through the State under a 2012
agreement.

 MEDICAID
The Federal government mandates that state Medicaid covers a core set of services. States can
cover or provide optional services if they so choose.
TABLE 1. Mandated and Optional State Medicaid Health Care Services2

New York State covers nearly all the optional services for Medicaid.2

APPLYING FOR MEDICAID IN ERIE COUNTY
Qualifying for Medicaid in New York is subject to a number of rules and conditions. Income
eligibility is a basic criterion
Medicaid is a flexible program. Individuals have qualified for Medicaid in New York State
despite making more than the Federal 2018 Annual Poverty Guideline. The Patient Protection
and Affordable Care Act of 2010 (“ACA”) creates a national Medicaid minimum eligibility level
that covers most Americans with household income up to 133% of the federal poverty level.
This amount is $33,383 for a family of four in 2018.
Beginning in January of 2014, the ACA provided a new and simplified method for calculating
eligibility for Medicaid and some other programs. The new method uses modified adjusted gross
income (“MAGI”). MAGI replaces a process that used income deductions that are different in
each state and often differed by eligibility group. The new method uses an individual’s MAGI,
deducts 5% (called a “disregard”) and compares that number to the income standards. An
applicant’s Adjusted Gross Income (“AGI”) is easily found: it’s on their most currently filed
federal income tax return.3
2 From Salient HHS, “Overview of Medicaid for Salient Users” dated October 2012, Page 34.
3 From the Department of Health and Human Services website. WWW.Medicaid.gov

 Pregnant females, children, disabled persons, and others may be eligible for Medicaid if their
income is above these levels and they have medical bills. Individuals who are certified blind or
disabled, or age 65 or older who have more resources may also be eligible.
Medicaid covers some costs retroactively. Medicaid may retroactively cover the health care
expenses for up to three (3) months prior to the application month, if the individual would have
been eligible during the retroactive period. Coverage generally stops at the end of the month in
which a person no longer meets the eligibility requirements.4
TABLE 2. Selected poverty guidelines as a percentage of the Federal poverty level 5

In Erie County, the Minimum Wage is $10.40 per hour as of December 31, 2017. 6 Individuals
earning minimum wage who work 40 hours per week for 50 weeks per year earn an annual wage
of $20,800.
As an example, a family of two children and two adults, with both adults working 40 hours per
week for 50 weeks at the New York State Minimum Wage as of July 1, 2018, would have an
income of $41,600.00. With no other income or adjustments to their AGI, the Disregard would
be $2,080.00. ($41,600 X 5%) In this example the MAGI would be $39,520 and this family
would not qualify for Medicaid under the current guidelines.
The ACA ensures that no one would lose health coverage as a result of converting to the MAGI
rules.7 This family could be covered under Medicaid should special circumstances apply, or
4 New York State Department of Health website. http://www.health.ny.gov/
5 US Department of Health and Human Services website. http://www.hhs.gov/
6 New York State Department of Labor website. www.labor.ny.gov
7 US Department of Health and Human Services website. http://www.hhs.gov/

 covered under the Medicaid adult coverage group, or they would be able to purchase insurance
with the benefit of a premium tax credit and possible cost-sharing reductions through the health
plan marketplace run by New York State.
The family described above has children who may qualify for Child Health Plus and the adults
may qualify for the Essential Plan health insurance.
If someone believes they qualify for Medicaid, or they believe their children may qualify for
Child Health Plus, or they wish to purchase insurance through the health plan marketplace run by
New York State, they should apply online through the NY State of Health
(www.nystateofhealth.ny.gov).
At this time, changes are being considered to Medicaid qualifications as well as other Medicaid
rules by the US Congress. Any interested applicant is urged to visit the NY State of Health
(www.nystateofhealth.ny.gov) website or www.medicaid.gov for the most current information.

MEDICAID DATA FOR ERIE COUNTY
TABLE 3. Total Erie County Medicaid cost, for the years 2012 through 2017, and from January
1, 2018 through June 1, 2018.

Medicaid claims must be initially submitted within 90 days of the date of service, but claims
must be finally submitted within two (2) years.
Erie County’s Medicaid payments are calculated on a weekly basis.

 The County’s final costs in 2014 were reduced by $5.7 million from the 2014 adopted budget
figure of $217,160,208, also due to additional enhanced FMAP funding. Table 3 reflects these
additional payments.

The FMAP Percentage
The reason for the drop in Medicaid costs to Erie County is the ACA. The ACA changed the
calculation of the FMAP percentage.
The Medicaid program is jointly funded by states and the federal government and in the case of
New York State, the county governments. In states that choose to participate, the federal
government pays at least half the cost of providing needed services to program beneficiaries.
The federal share of those costs is determined by the FMAP. The Social Security Act requires
the Secretary of Health and Human Services to calculate and publish the FMAPs each year.8
The FMAP is calculated annually using a formula set forth in federal statute. The FMAP is
inversely proportional to a state’s average personal income relative to the national average.
States with lower average personal incomes have higher FMAPs. Personal income data is
lagged, so data used for FY 2018 was based on 2014-2016.
The ACA provides an FMAP of 100 percent for the period 2014-2016 and at least 90 percent
thereafter for the cost of covering newly eligible low-income adults. The costs of administration
are generally matched at 50 percent, although some administrative activities receive a higher
federal matching rate.
The FMAP for New York State for the federal government’s past fiscal year (October 1, 2017
through September 30, 2018) is 50%9. New York State shares the lowest FMAP percentage in
the nation with thirteen (13) other states. The highest FMAP percentage for federal FY 2018 is
75.65% for the state of Mississippi. 10 This means that despite the large cost of New York’s
Medicaid program, by percentage, the state is receiving a lower federal contribution than many
other states.
Beginning in 2014, ACA establishes highly enhanced FMAPs for the cost of services to lowincome adults with incomes up to 138% of the Federal Poverty Level (“FPL”) who are not
currently covered. The federal government will pick up 100% of such costs in 2014 through
2016, phasing down to 90% in 2020 and beyond. The Enhanced FMAP for New York State is
65% for FY 2018.11
This enhanced FMAP percentage has resulted in an increased reimbursement to Erie County, and
as a result, a lower County share of the total Medicaid cost.
8 An Overview of the Federal Medicaid Matching Rate (FMAP), The Henry J. Kaiser Family
Foundation. http://www.kff.org.
9 US Department of Health and Human Services website. http://www.hhs.gov/
10 US Department of Health and Human Services website. http://www.hhs.gov/
11 US Department of Health and Human Services website. http://www.hhs.gov/

 There is an Enhanced FMAP for CHIP (“eFMAP”) used in the Children’s Health Insurance
Program (“CHIP”) and in the Medicaid program for certain children for expenditures for medical
assistance. New York State’s eFMAP for 2018 is 88%.12

Medicaid Expenditures by Billed Provider
Reviewing Medicaid costs by billed provider (such as dentist, pharmacy, laboratory, etc.) offers
an opportunity to see where Medicaid spends its funds.
The State has moved more individuals to Managed Care since 2011, with costs shown below
demonstrating that progression. Managed Care has also largely assumed the responsibilities for
the cost categories of Nurse, Pharmacy, Dental, and Laboratory Costs.
TABLE 4. Medicaid expenditures by billed Medicaid provider type.

12 US Department of Health and Human Services website. http://www.hhs.gov/

 Medicaid claims must be initially submitted within 90 days of the date of service, but claims
must be finally submitted within two (2) years.
The category of “Capitation Provider” now accounts for more than half of all Medicaid payments
on Table 4. As Capitation Providers do provide services listed lower in Table 4, but do not
provide the financial detail, Table 4 can be considered incomplete. Unless the MDW or
Capitation Providers provide cost category detail for the category “Capitation Provider”, we will
discontinue this table in future reports.
TABLE 5. Additional descriptions for selected Medicaid categories

 Erie County Medicaid Expenditures for Emergency Care
Some of the best ideas for what is discussed in this document come from the general public.
Comments are received via social media, by phone and in person to the MIG office staff and by
you directly. One comment consistently voiced is Medicaid clients use emergency services for
non-emergency maladies. As a follow-up to questions posed to you in late 2017 and to us in
2018, we are able to determine the number of emergency department visits by Medicaid clients.
We are also able to determine the severity level of the medical diagnosis for those Medicaid
claims.
TABLE 6. Emergency Department claims by Erie County Medicaid Clients

Rate Summaries 1402 and 1419 do not have an indication of the level of severity. However, for
these two categories, we researched the most common illness diagnosed. For 1402, the most

 common illness was Chest Pain. For code 1419, the most common illness was chronic
obstructive pulmonary disease (COPD).
So that you might have an idea of the types of health conditions treated within the above
categories, we created Table 7.
TABLE 7. Emergency Department Visits by Severity and ICD Code

Although covering the year 2012, the New York State Department of Health published the
leading causes of death for Medicaid clients. It is reproduced in Table 8.
From Table 6, codes 1402 and 1419 do not give an indication of the severity of the illness
treated. Therefore, we did not consider them in the below analysis.

 Counting just the procedure codes 99281 through 99285, there were 181,810 emergency
department visits in 2017. Of those, about 86% or 156,971 are considered to be moderate or
worse in severity. The percentages are roughly consistent for the years 2015 and 2016.
We cannot say that Medicaid clients do not misuse emergency department services. We can say
that about 14% of emergency department visits by Medicaid clients were deemed by a medical
professional to be of moderate to low severity or of low urgency.
TABLE 8. The Ten Leading Causes of Death by New York State Medicaid Clients in 2012.13

We include this table to highlight that Medicaid clients that use emergency departments for
issues such as chest pain or respiratory infections have good reason to be concerned.

13
https://www.health.ny.gov/statistics/vital_statistics/docs/leading_causes_of_death_nys_2012.pdf

 Erie County Medicaid Expenditures by Location, Age and
Race
The number of persons on Medicaid in Erie County and the claims incurred on behalf of those
persons dictate Medicaid costs. The New York State Medicaid database allows for the tracking
of Medicaid clients based upon the zip code of the Medicaid patient. For the twelve zip codes
with the largest number of Medicaid recipients, that data is provided in Table 9.
TABLE 9. Medicaid Clients by Year and Residing Zip Code.

Table nine shows that in 2017, the top five zip codes contain about thirty-one percent (31%) of
the County’s Medicaid population. Not surprisingly, these zip codes are concentrated in the City
of Buffalo. The seventh-largest zip code is the City of Lackawanna, the tenth-largest is
Cheektowaga, and the twelfth-largest zip code is the City of Tonawanda and part of the Town of
Tonawanda.
Erie County’s population on July 1, 2017 was 925,528. 14
14 US Census www.census.gov

There were 286,434 clients on

 Medicaid in Erie County in 2017. About 31% of all Erie County residents are covered by
Medicaid.
Appendix A is a map of Medicaid recipients, broken out by zip code. Erie County’s Department
of Environment and Planning, the Geographic Information Systems team, was key to the
development of this map. We appreciate their assistance.
Medicaid clients by race and age are shown in Table 10.
TABLE 10. Medicaid Recipients by Age and Race

 In 2017, more than 37% of all Medicaid clients are children. (Persons under the age of 21)
In 2008, the percentage of children on Medicaid was 27%.
TABLE 11. Medicaid Cost and Client Summary.

 Whites as a group account for the highest average cost per Medicaid Client. When age becomes
a factor, the highest average cost per Medicaid client is for those persons 65 years of age and
older.

 PRESCRIPTIONS IN ERIE COUNTY PAID THROUGH MEDICAID
The MIG Team can analyze prescriptions paid through Medicaid by the type of drug, prescribing
medical professional, Medicaid patient, number of refills and other criteria. The MIG Team uses
this data to determine the most commonly filled prescriptions.
TABLE 12. Most commonly filled prescriptions*

*generic drug names
Since early 2015, Hydrocodone has fallen from its prominent perch as the number one
proscribed Medicaid drug in Erie County. Considering how abused this particular medication
can be, such a drop is significant.
Hydrocodone–Acetaminophen is a controlled substance. It was also the most prescribed
Medicaid drug in Erie County from 2008 through 2014. Hydrocodone-Acetaminophen, also
known as Vicodin or Lortab, is one of the most abused prescription drugs in the U.S.
As we have watched with some satisfaction the fall of Hydrocodone–Acetaminophen as recorded
on Table 12, we have been alarmed at the increase of the number of prescriptions for Gabapentin.
Gabapentin is approved by the Food and Drug Administration to treat epilepsy and pain related
to nerve damage, called neuropathy. Also known by its brand name, Neurontin, the drug acts as a
sedative. It is widely considered non-addictive and touted by the federal Centers for Disease
Control and Prevention as an alternative intervention to opiates for chronic pain. Generally,

 doctors prescribe no more than 1,800 to 2,400 milligrams of gabapentin per day, according to
information on the Mayo Clinic’s website.
Gabapentin does not carry the same risk of lethal overdoses as opioids, but drug experts say the
effects of using gabapentin for long periods of time or in very high quantities, particularly among
sensitive populations like pregnant women, are not well-known.
Gabapentin is being subverted to a drug of abuse. The State of Kentucky has classified
Gabapentin as a Controlled Substance after it was found in over one-fourth of all overdose
deaths in Louisville in 2017. A 2017 study of opioid users reported Gabapentin and related drugs
were easy to obtain and "reinforced the effects of heroin." Some users "were concerned it
induced 'blackouts' and increased the risk of overdose."15
As per our discussions with you throughout 2017 and early 2018, we will continue to monitor
Gabapentin prescriptions.
The pharmaceutical drugs shown in Table 12 and their commonly prescribed purpose are
reported in Table 13 below:
TABLE 13. Indications for commonly prescribed medications.

15 Doctors sound the alarm on "opioid alternative" Gabapentin - CBS News - April 2, 2018.

 To assist you to better understand the number and types of prescriptions, over the counter
medications and medical supplies used by Medicaid clients in Erie County, we provide Table 14.
TABLE 14. Medicaid and Encounter Prescriptions Filled by Drug Class in 2017.

“Medicaid & Encounter Prescriptions Filled” include prescriptions filled not just by Medicaid
itself, but by private insurers who are reimbursed by Medicaid. This is as comprehensive a
figure as we have ever been able to provide.
The “Explanation” column is the most common use for these medications. It is not an allinclusive description of the use of medications included in a Therapeutic Class.
For ease of presentation, we have limited Table 14 to the top ten categories. More than eighty
categories of Therapeutic Class exist for the drug class of Prescription Required.
The most common psychostimulant-antidepressant prescribed in 2017 was Sertraline HCL, more
commonly known as Zoloft.

 In late 2018, we received a request for demographic data from the Erie County Health
Commissioner, Dr. Gale Burstein. That data covers Medicaid clients with prescriptions for
Hydrocodone-Acetaminophen. We provide it here to describe a typical Hydrocodone recipient.
TABLE 15. Demographic Data for Hydrocodone-Acetaminophen Clients

In sum, for 2017, a typical user of prescription Hydrocodone-Acetaminophen could be described
as 45-64 years old, a woman, white and single.

 MEDICAID AND THE VARIOUS FORMS OF FINANCIAL
ASSISTANCE IN ERIE COUNTY
The MIG Team receives calls regularly from individuals in Erie County who are misinformed
about public benefits in Erie County. Although this office specializes in Medicaid, many of these
calls concern other forms of public benefits. To address this misinformation, we have included
this section, which explains the various forms of Assistance in Erie County, and discusses the
number of clients covered. We are grateful for the assistance of the Department of Social
Services in the development of this section of this document.
TABLE 16. Assistance Types in Erie County and a Count of Beneficiaries.

The source for the data in Table 16 is the Cognos Data Warehouse, which is not part of New York
State Medicaid Data Warehouse.
The “Total Financial Assistance” column counts individuals, who sometime during that calendar
year, received some form of Financial Assistance. If a person was on Financial Assistance, then
left, then returned that same year, that person is only counted once. Individuals qualify for, and
then fail to qualify for, Financial Assistance. At any one instant there are about thirty-one
thousand persons on Financial Assistance in Erie County.
Footnote A bears repeating: Some persons receive more than one form of Financial Assistance.
Some persons can receive Financial Assistance and Non-Financial Assistance, such as Food
Stamps (“SNAP”). SNAP is not cash assistance. SNAP can only be used to purchase qualifying

 food products.


Food Stamp clients are those individuals who can both get Food Stamps as part of their
Financial Assistance or as Non-temporary assistance such as SNAP (“Supplemental
Nutrition Assistance Program”).



Temporary Assistance to Needy Families (“TANF”) is a category of Financial Assistance.
Clients on TANF are adults with a minor, dependent child who have been on Financial
Assistance for five years or less. Some clients can receive TANF despite being on
Financial Assistance for more than five years, if they have a permanent work exemption.
An example of permanent exemption is a person receiving or applying for Supplemental
Security Income (“SSI”). In general, you must be sixty-five years of age or older, or
blind, or disabled to qualify for SSI.



Temporary Assistance to Needy Families with a Drug or Alcoholic Dependent Adult
needing full time treatment represents clients who qualify for TANF but have an adult in
the household who is in rehabilitation and is unable to work. This rehabilitation can be
for alcohol or another drug. If the adult in rehabilitation is able to work, the client is not
placed in this category.



Safety Net Cash Assistance clients are individuals with no minor, dependent children who
have been on assistance for less than twenty-four months. These clients include single
individuals who are exempt from work requirements and families with minor, dependent
children on assistance for more than five years and all the adults in the household have a
temporary work exemption.



Safety Net Non-Cash Assistance clients are individuals who are able to work and have
been on Financial Assistance for more than five years. This category also includes clients
who are single individuals able to work who have been on Financial Assistance for more
than twenty-four months and single individuals on Financial Assistance for less than
twenty-four months who are drug or alcohol dependent.

A popular myth is clients on Medicaid in Erie County also receive other forms of Financial
Assistance. That is true, but only for a small minority of Medicaid clients. For example, in
2017, there were more than 286,000 persons on Medicaid in Erie County. Compare that to the
slightly more than 49,000 persons on all forms of Financial Assistance during that same period.
Most Medicaid clients in Erie County are not on any other form of Financial Assistance.

 CONCLUSIONS
 As we predicted in last year’s report, Erie County Medicaid’s population appears to have
stabilized between 282,000 and 287,000 clients.
 However, Medicaid costs have not stabilized. In 2017, Medicaid costs for Erie County
Medicaid clients have climbed to over $2 billion dollars. Much of that cost is paid by
New York State and the Federal government.
 About 31% of Erie County residents’ health insurance is now being provided by

Medicaid. This is about the same percentage as last year.
 In 2017, there are more Whites on Medicaid in Erie County than Blacks/AfricanAmericans, Hispanics/Latinos and Asians/Pacific Islanders combined.
 More than 37% of all the persons on Medicaid in 2017 in Erie County were children.
(Persons under the age of 21).
 The vast majority of Emergency Department visits by Erie County Medicaid clients
appear to be for legitimate emergency medical needs.
 The most common medical need for Medicaid prescriptions written in 2017 was for drugs
that fight depression.
 Hydrocodone–Acetaminophen has fallen from the number one prescribed Medicaid

medication in 2015 to number seven in 2017. This continues to be a positive sign in the
fight against opioid abuse, but Hydrocodone–Acetaminophen still remains one of the
most abused drugs in the United States.
 Gabapentin, also known as Neurontin, is a drug that is used to treat pain related to nerve
damage. It is also a candidate for abuse by those who formerly abused opioids.
Gabapentin usage is on the rise in Erie County.
 Most Medicaid clients in Erie County are not on any other form of Financial Assistance.
We gratefully acknowledge the cooperation and assistance of OMIG, the New York State
Department of Health, the Erie County Department of Health, the Erie County Department of
Social Services, the Erie County Department of Environment and Planning - Geographic

 Information Systems Team and the Erie County Department of Management and Budget. We
look forward to working on additional projects with all these groups.