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SCHENECTADY — New York Attorney General Letitia James on Monday announced a settlement with the owner of a Schenectady-based medical transport company that was found to have billed Medicaid at least $400,000 for transportation services that were not provided.

Investigators determined that Ismat Farhan, through his company USA Medical Transport, submitted over 2,500 false claims where either the transportation services never happened, did not occur as described or lacked the required documentation, according to the settlement agreement.

“Medicaid is meant to help support the medical needs of vulnerable New Yorkers, not to pad a company’s profits,” James said in a statement. “Farhan and USA Medical Transport took advantage of their patients and taxpayers by billing Medicaid for thousands of services that were never provided.”

Farhan will pay $862,500 to the state's Medicaid program, according to the settlement.

Under state and federal false claims law, state authorities can fine Medicaid providers up to three times the amount they can prove was fraudulently billed. It's common for the state to settle with the provider for double the amount, according to the attorney general's office.

USA Medical Transport, meanwhile, is still providing services. An attorney for Farhan declined to comment on the settlement.

Medicaid recipients are eligible to receive transportation to and from appointments with health care...

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