Purpose

To determine whether the Office of Alcoholism and Substance Abuse Services (OASAS) is effectively monitoring the contract to ensure claims submitted by Samaritan Village, Inc. are valid and consistent with contract terms and that contract deliverables are being provided.

Background

OASAS administers programs for the prevention and treatment of alcohol and substance abuse. On October 1, 2009, OASAS entered into a five-year $73.3 million contract with Samaritan Village, Inc. covering the period July 1, 2009 through June 30, 2014 to conduct a Chemical Dependency Services Program (Program) for adults. Samaritan Village has service facilities located throughout the New York metropolitan area and provides residential, outpatient and methadone treatment services to its clients. According to the contract, OASAS reimburses Samaritan Village for the net costs it incurs to provide the contracted services, up to the contract amount. Therefore, if Samaritan Village receives any program-related, noncontract revenues for the individuals it serves (e.g., Medicaid, third party payers, etc.), it reduces claimed Program expenses by those amounts.

Key Findings

• OASAS is not effectively monitoring the contract to ensure that claims submitted by Samaritan Village are valid and consistent with contract terms. As a result, OASAS reimbursed Samaritan Village $973,881 for unallowable, inappropriate, undocumented or questionable expenses. Of this amount, $253,957 was for personal services and $719,924 was for other than personal services.
• Samaritan did not follow required purchasing guidelines designed to ensure a reasonable price is paid for services received, and did not obtain prior OASAS approval, for seven contracts totaling $337,458.
• We question Samaritan's allocation of $1,063,810 in costs among OASAS and non-OASAS programs.
• Samaritan Village underreported program revenue it received by $94,008 and therefore received $94,008 more in reimbursement from OASAS than it was entitled to.

Key Recommendations

• Increase monitoring to ensure that all claimed expenses are appropriate and allowable.
• Recover $661,793 from Samaritan Village as repayment for unreported revenues and expenses identified in this report as inappropriate, unallowable or undocumented.

Other Related Audits/Reports of Interest

Office of Alcoholism and Substance Abuse Services: Phase Piggy Back, Inc. (2009-R-1)
Office of Alcoholism and Substance Abuse Services: Chemical Dependency Program Payments to Selected Contractors in New York City (2007-S-60)