What Happened
The Justice Department announced June 16 that it filed a lawsuit in federal court against the New York State Department of Health, state Medicaid Director Amir Bassiri, and Public Partnerships LLC, the company managing New York’s Consumer Directed Personal Assistant Program.
CDPAP is supposed to help Medicaid patients with disabilities or significant medical needs get home care through lay caregivers. In 2024, New York consolidated administration of the program from hundreds of fiscal intermediaries into one single fiscal intermediary, creating what DOJ called one of the most lucrative Medicaid administration contracts in the country.
According to DOJ, that selection process was not exactly a civic TED Talk about transparency. The lawsuit alleges New York “pre-selected” Public Partnerships through a sham bid process, then failed to act after learning the company intended to deviate from its bid and violate contract financial terms.
The department says the alleged scheme generated millions of dollars in unauthorized profits funded by federal taxpayers and seeks to stop further misrepresentations and unauthorized charges.
Why This Matters
Home-care Medicaid programs are not abstract budget goblins. They involve disabled people, elderly people, family caregivers, health aides and taxpayers trying to keep vulnerable people out of institutions.
So if the federal government is right that a $10 billion program got routed through a favored vendor and then left to leak unauthorized money, that is not “procurement friction.” That is government turning a care program into a vending machine for insiders.
The Dumb Part With The Single Vendor Crown
The dumb part is the phrase “single fiscal intermediary,” which already sounds like something a committee invents five minutes before lunch. You take a complicated program, crown one vendor king of the paperwork mountain, and then act surprised when the mountain starts charging admission.
To be clear, these are allegations in a lawsuit. Public Partnerships and New York can fight them in court. But as a piece of alleged government nonsense, it has the full buffet: billion-dollar contract, sham-bid claim, taxpayer money, disabled patients, and the phrase “favored vendor” hovering over the room like a fluorescent light about to die.
The Bottom Line
DOJ says New York’s giant home-care contract went from “streamlining” to “who authorized all these profits?” That is the eternal government lesson: when someone promises to simplify a public program by handing it to one giant contractor, count the spoons before dessert.