Purpose

The objective of our examination was to determine whether contract payments the Department of Health made to Cancer Service Network, Inc. (CSN) for the Cancer Services Program were appropriate. We examined payments made for services provided during the period April 1, 2010 through March 31, 2011.

Background

The Cancer Services Program provides free cancer screenings to uninsured and underinsured income eligible New York State residents. DOH administers the program through multiple vendors in each of eight regions to provide clinical and administrative services necessary to carry out the program. Both the clinical and administrative services contracts allow the vendors to subcontract services.

DOH and CSN entered into nine clinical services contracts totaling approximately $26.74 million and nine administrative services contracts totaling approximately $7.74 million. CSN did not perform any clinical or administrative services under these 18 contracts. Instead, CSN subcontracted all services to various vendors, including JLJ Consulting Group, LTD (JLJ Consulting), a for-profit corporation, which in turn paid four independent contractors for some of those administrative services. Mr. Joseph Junkovic is the Chairman of CSN and the CEO of JLJ Consulting and its sole employee.

Key Findings

We found Mr. Joseph Junkovic knowingly overbilled DOH and was paid $397,325. This overbilling included: (i) $73,568 for at least 1,903 hours that he did not work, (ii) $192,892 for 4,732 hours he claims to have worked but could not provide documentation to substantiate he worked those hours, (iii) $45,626 for 2,085 hours for work subcontractors did not perform, and (iv) $85,239 for cost of living adjustment (COLA) payments he obtained through false certifications.

We referred our findings to the United States Attorney’s Office – Southern District of New York (US Attorney). Based upon our collaboration with the US Attorney, on August 14, 2013, Mr. Junkovic was arrested for one count of mail fraud and one count of theft of US government property. On September 24, 2014, Junkovic was sentenced in United States District Court for the Southern District of New York to over a year in federal prison and ordered to pay $360,556 in restitution and criminally forfeit $360,556.