Albany, NY – March 25, 2025 – New York Governor Kathy Hochul is under intense scrutiny as allegations intensify that her administration manipulated the bidding process for a $9 billion Medicaid contract tied to the Consumer Directed Personal Assistance Program (CDPAP). The accusations, detailed in multiple lawsuits and amplified by public officials, including Democratic Representative Ritchie Torres, paint a troubling picture of potential corruption at the highest levels of state government. As of this morning, March 25, 2025, the controversy shows no signs of abating, with calls for state and federal investigations growing louder and stakeholders warning of dire consequences for New York’s most vulnerable residents.
The CDPAP, a Medicaid-funded initiative allowing elderly and disabled New Yorkers to hire their own caregivers—often family members—has ballooned in cost to over $9 billion annually, serving nearly 250,000 individuals by 2023. Critics have long pointed to the program’s rapid growth as evidence of insufficient oversight and potential fraud, prompting Hochul to spearhead reforms aimed at reining in expenses. Central to these reforms was a shift from using nearly 700 fiscal intermediaries—middlemen handling payroll between caregivers and Medicaid—to a single contractor, Public Partnerships LLC (PPL), a Georgia-based firm. However, this overhaul, intended to streamline operations and curb waste, has instead ignited a firestorm of legal and political challenges.
The allegations first surfaced prominently in late 2024, when FreedomCare LLC, a home care provider, filed a lawsuit against the New York State Department of Health and PPL, claiming the bidding process was rigged from the outset. Represented by the high-powered law firm Gibson Dunn, FreedomCare alleged that state officials had pre-selected PPL before competitive bidding even began—a charge bolstered by a sworn affidavit from Carlos Martinez, CEO of BRIDGES, a home care agency. Martinez claimed that during an April 2024 Zoom meeting, a state chief disability officer informed him and other operators that PPL was the chosen contractor, months before the official bidding process commenced. This testimony, described by FreedomCare’s attorney Akiva Shapiro as a “smoking gun,” has become a cornerstone of the legal case now pending before the New York Supreme Court.
Adding fuel to the fire, a December 2024 lawsuit alleged that the powerful healthcare union 1199 Service Employees International Union (SEIU) collaborated with Hochul’s administration and PPL to secure the contract. Critics contend that this partnership was part of a broader deal to unionize CDPAP caregivers, potentially increasing union dues while driving up program costs—ironically, the very issue Hochul’s reforms aimed to address. Reports have surfaced that PPL began posting job listings as early as August 2024, nearly two months before the contract was officially awarded, raising further suspicions of a predetermined outcome. Bryan O’Malley, executive director of the Alliance to Protect Home Care, an industry group representing fiscal intermediaries, called this “a mountain of evidence pointing to a rigged bid,” urging Hochul to release all communications with PPL to restore public trust.
Governor Hochul’s office has vehemently denied these allegations, insisting that the bidding process was transparent and fair. A spokesperson for the governor stated, “The State Department of Health followed the standard procurement process based on qualifying language approved by the State Legislature. No state official knew who would be awarded the contract until the official announcement.” The administration has portrayed the overhaul as a necessary step to protect taxpayers and home care users by eliminating years of waste, fraud, and abuse in the CDPAP. They note that PPL scored highest among 100 respondents during the bidding process, a claim intended to refute accusations of favoritism.
Yet, the controversy has drawn bipartisan criticism, with figures like Representative Ritchie Torres, a Bronx Democrat, escalating the issue into the national spotlight. In December 2024, Torres penned a letter to the state Department of Health Inspector General Lucy Lang and the U.S. Department of Health and Human Services Inspector General Christi Grimm, urging an independent investigation into what he termed a “multi-billion dollar boondoggle.” Torres highlighted the exclusion of State Comptroller Tom DiNapoli from reviewing the contract—an unusual omission that he suggested could indicate an intent to conceal irregularities. “There may be something rotten in the state of New York under Governor Kathy Hochul,” Torres wrote, echoing sentiments from Martinez’s affidavit and amplifying public calls for accountability.
The stakes of this dispute extend far beyond political rhetoric. The CDPAP serves some of New York’s most vulnerable populations, including elderly and disabled individuals who rely on in-home care to avoid institutionalization. Opponents of the overhaul, including home care providers and advocacy groups like the New York Health Plan Association, warn that consolidating fiscal intermediaries into a single contractor risks destabilizing the program. In February 2025, the association cautioned that thousands of disabled veterans could be forced into hospitals or nursing homes if the transition to PPL falters, a scenario they described as a “worst-case” outcome given strained healthcare capacity. Elderly and disabled New Yorkers have also voiced their fears directly to Hochul, with one widely circulated encounter on March 15, 2025, showing an elderly woman confronting the governor about losing her Medicaid home healthcare by April 1—the scheduled completion date for the transition.
Hochul’s administration has framed these concerns as overblown, emphasizing that PPL has committed to relocating its headquarters to New York and is actively recruiting staff to ensure a smooth rollout. A PPL spokesperson clarified that while job postings were made in anticipation of the contract, no hires were finalized until after the award, calling such preparations standard practice for large state contracts. Nonetheless, skepticism persists, fueled by PPL’s reportedly shaky financial status and its history of operational challenges in other states, as noted by critics like O’Malley.
This scandal is not Hochul’s first brush with Medicaid-related controversy. In 2022, she faced accusations of favoritism when a $5 billion Medicaid transportation contract was awarded to Medical Answering Services, a company linked to a campaign donor, earning her the moniker “Kickback Kathy” from the New York Republican Party. That same year, a $637 million no-bid contract for COVID-19 tests went to Digital Gadgets, another donor-connected firm, at double the market rate. These prior incidents have lent credence to current allegations, casting a long shadow over Hochul’s tenure as she approaches the 2026 gubernatorial election.
The political fallout is already evident. Posts on X as recently as March 16, 2025, reflect a mix of outrage and calls for federal intervention, with some users thanking figures like Louisiana Senator John Kennedy for reportedly looking into the matter, though no official confirmation of such involvement has emerged. Torres’s public feud with Hochul has further complicated her standing within her own party, while Republican lawmakers in Congress have seized the opportunity to pressure the federal government to withhold Medicaid funding pending resolution—a move that could delay the CDPAP changes but risks disrupting care for millions.
As the legal battles unfold and the April 1 deadline looms, the Hochul administration faces a critical test. The governor, who ascended to office in 2021 promising to clean up Albany’s reputation after Andrew Cuomo’s scandal-plagued exit, now finds herself ensnared in a narrative of alleged cronyism and mismanagement. Whether the courts or investigators substantiate the rigging claims remains uncertain, but the damage to public trust is palpable. For New Yorkers reliant on CDPAP, the outcome will determine not just the integrity of their healthcare system but also the legacy of a governor once heralded as a reformer. 17GEN4.com
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