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Sep 12 2011

New York State to Investigate Nonprofits with Eye on Executive Compensation

Author(s): Blitman & King LLP

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New York State Governor Andrew Cuomo recently announced that the State will be conducting investigations of nonprofit organizations, including hospitals and clinics, that receive Medicaid funding from the State. A New York State Not-for-Profit Entities Task Force will be created to audit the organizations with a focus on executive compensation levels.  The investigations are in response to reports of excessive salaries and compensation packages for executives of nonprofit organizations that depend on state Medicaid funding.

Currently there are no state rules governing executive and administrative compensation for nonprofit organizations that receive state support. The State’s Medicaid Inspector General, who will be involved in the investigations, has the authority to revoke Medicaid payments from providers if they are found to be committing fraud.


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