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New York's Medical Indemnity Fund denies claims, despite promise to cover kids' lifelong health care, parents say

Parents say New York health care fund is denying their claims
Parents say New York health care fund is denying their claims 04:41

NEW YORK -- Parents of kids injured at birth due to medical malpractice say New York consistently delays and denies their claims under the state's Medical Indemnity Fund, which promises lifelong health care. 

Gov. Kathy Hochul has promised a full review of the program, but its future is uncertain as it runs out of money.

New York's process is different

Denise Olivo says her son GianRaul suffered a neurological injury at birth that seriously impaired his motor skills. He's one of thousands of kids in New York's Medical Indemnity Fund. 

In other states, parents who sue for malpractice and win get a substantial award. But in New York, the provider found to be negligent is only on the hook for partial damages. 

Instead of being awarded for the payment of future costs, New York mandates the children get care through the fund. 

"I'm tired of fighting," said Olivo, who uses the fund to pay for GianRaul's summer therapy sessions, which are two hours away from their home. "I don't have an option to not fight." 

The fund pays for therapy, but not the required lodging. GianRaul's family pays out-of-pocket for the hotel. They also spent around $30,000 on a wheelchair lift for a van. 

"What we were told is, you buy the van and you convert it, you pay for everything. We're going to reimburse you. Now they're telling us we didn't follow the rules specifically of what they were looking for," said Raul Moreno Carreon, GianRaul's dad.

Carreon's claim for the van was denied, in addition to one for the structure that covers his son's elevator.

"They're denying accessibility to our own money," Carreon said. 

"It's frustrating because no one really cares," Olivo said. 

Other families agree, saying they lost approximately half their settlement when they were pushed into the fund and now battle confusing coverage rules. 

New York stopped enrolling new kids into the fund

In May, the state suddenly stopped enrolling new kids into the fund. 

State Sen. Liz Krueger called for a public roundtable. 

"I would really love to see a commitment from the governor that her agencies will be there," Krueger said in July. 

There's been no commitment from Hochul two months later. 

At a recent news conference, CBS News New York investigator Mahsa Saeidi asked the governor if she's committed to simplifying the process for families. 

"This is a very important fund. I agree with the families that we need to continue this," Hochul said. 

The governor noted she did bail out the fund in May. 

"All these decisions are made in the context of the budget. So, we'll be beginning our next budget negotiations with the Legislature and looking at a full review of the whole program," Hochul said. 

State Assembly Member Amy Paulin, who chairs the Committee on Health and is working with Krueger, has been in touch with GianRaul's family.

"[Hochul] knows there's a problem," Paulin said. "I think [this] story's going to be very important. When you actually see the family and see the child, how do you not address it?" 

Paulin hopes the state is seeking a solution. We'll know by January, when the governor unveils her budget. 

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