Three nurse staffing agencies in New York kept about half of all the money that was intended by state officials to boost the hourly wages of direct-care workers treating medically fragile children over the past two years, an audit by the state comptroller has concluded.
The three agencies kept a total of $1.5 million of the $3 million in wage enhancements that came through an increase in state Medicaid payments, according to the audit from New York Comptroller Thomas DiNapoli’s office. The pay increases, which boosted nurse wages by an average of about $7 an hour, were intended to attract more nurses to the field. Instead, the agencies kept much of the money for themselves, auditors said. Although the staffing firms said they needed the money to offset fringe benefits costs, the state analysis found that the amounts kept exceeded any rise in benefit expenses.
The audit focused on three agencies, but auditors concluded there was significant risk other agencies across the state also inappropriately held onto the money. “If nursing agencies consistently failed to distribute these funds properly, the amounts of the underpayments to the nurses who serve medically fragile children could be very significant,” the audit says.