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Number Rises To 170 For Dead Workers City Insured

By:  Brian Meyer
News Staff Reporter

City Hall has discovered that it has been paying health insurance premiums for more dead employees than auditors initially estimated.

After scouring Social Security data this week, the city determined it has shelled out more than $2 million for premiums for 170 dead workers. The new disclosure Tuesday came four days after auditors said the city had paid premiums for 152 dead employees.

The city finally bought access to the Social Security Death Index -- seven months after Mayor Byron W. Brown had ordered his human resources chief to "immediately" purchase the data. "They were online as of Monday, checking our benefit rolls against the new data," said chief city auditor Darryl McPherson.

Steps are being taken to try to recover some or all of the payments, McPherson added. City officials have already started discussions with HealthNow New York. The Buffalo parent of BlueCross BlueShield of Western New York received most of the premiums in question. All but a handful of the deceased individuals have died in the past two years, a time period when the city has had only one insurer.

McPherson said he is cautiously optimistic that some of the money will be recovered. He noted that an audit performed by a previous administration in the early 1990s uncovered numerous insurance-related discrepancies, including payment of health premiums for deceased employees. McPherson said the city managed to recoup a substantial reimbursement from insurers at that time.

The city has paid $4,500 for access to the Social Security data, allowing staffers to compare city payrolls with death data for about two years.

Paul Springer, a systems support analyst in the Management Information Systems unit, has been creating a template that could be used to permanently track deaths. But once the system is in place, City Chief Information Officer Raj Mehta said it will be up to the Human Resources Department to perform tracking tasks.

"We can create the tools for people, but we cannot do the work of other people," Mehta said.

Auditors have been critical of the Human Resources Department and its embattled commissioner, Karla L. Thomas. A scathing report issued in January red-flagged numerous deficiencies and raised the likelihood that the city has been paying for health insurance benefits for an undisclosed number of deceased employees. One day after the audit was released, the mayor ordered Thomas to take 10 steps to correct deficiencies.

Seven months later, auditors claimed Thomas did little to address problems. She never followed the mayor's edict to "immediately" purchase access to the death-related data from Social Security.

Administration officials are trying to find out why the problems weren't fixed. When asked Friday if Thomas' job was at risk, Brown said he wasn't "taking anything off the table."

Some lawmakers have been calling for Thomas' ouster since January. But unlike other commissioners who serve at the pleasure of the mayor, Thomas has a six-year contract that is mandated by the state. Her contract doesn't expire for more than four years.

Still, some lawmakers claim that Thomas could be removed based on incompetence.

One lingering question is whether some families of deceased workers may have used insurance coverage they weren't entitled to receive. "That's something we don't know yet," McPherson said. "Part of the investigation will be to determine if some family coverage policies were being used."

McPherson said if some families were using the policies of deceased relatives and it could be demonstrated that they did so knowing that they weren't entitled to coverage, there could be legal repercussions.

"In most cases, this would be considered fraud," he said.

How much money the city might be able to recoup will hinge on numerous factors, officials said, including whether insurance companies paid for any medical services for families of deceased workers.