State investigators find Sansky’s district-issued health insurance OK

Sept. 18--The more than 11 years of health insurance that former Scranton School District fleet manager Daniel Sansky and his wife, Mary Ann, received through the district wasn't illegal, state investigators concluded.

Because the district relies on self-insurance for health care coverage, it can offer insurance to contractors like Sansky rather than only employees, the investigators and a statewide grand jury concluded, according to the grand jury's presentment released Tuesday. Self-insurance means the district pays the cost of all medical claims rather than paying a private company for insurance that pays medical bills.

"Accordingly, there was no evidence of insurance fraud," the grand jury presentment says.

The presentment outlined criminal charges against Sansky, accusing him of overbilling and sometimes double-billing the district for vehicle maintenance. The presentment did not recommend charges related to the health insurance, one of the central findings of a state Auditor General's Office report issued in October.

Hired as fleet manager in August 2005, Sansky and his wife received health insurance and dental benefits from Jan. 1, 2006, until April 30, 2017, according to the auditor general's report. The report called the benefits "improper" and "an unnecessary burden to the taxpayers" because Sansky was a contractor and not a district employee. The audit report says the district had no policy on allowing non-employees to get health insurance and the state school code doesn't specifically authorize school districts to insure non-employees.

Based on what retirees contributed to the district's self-insurance fund to cover themselves and spouses between Jan. 1, 2012, and Dec. 31, 2016, the report estimated Sansky and his wife would have owed the district $96,131 during that period, but contributed only $8,450. The district paid at least $290,730 in claims from the health care self-insurance fund to cover medical care the Sanskys received, district records show.

Despite the grand jury not recommending criminal charges related to the health insurance, state Auditor General Eugene DePasquale repeated his assertion Tuesday that the Sanskys' district health insurance was improper.

"There is no evidence that there was even a contract with this guy," DePasquale said during a conference call. "There was no justification."

It remains unclear who in the district authorized the Sanskys to receive health insurance. Minutes of the Aug. 22, 2005, meeting when the school board hired him say he was hired as a contractor who would get paid based on hours worked. The minutes say nothing about health insurance. Past board members said they never knew Sansky received health insurance. One former board member said district administrators must have decided to insure the Sanskys.

Sansky gave investigators a different story. As investigators raided his business, Danny's Auto Service in South Scranton, on May 15, Sansky told investigators Michael Mulvey and Robert McHugh that School Director Paul O'Malley congratulated him on his new job and told him "that he was now a district employee," according to the grand jury presentment. O'Malley died Jan. 17, 2016.

Sansky told investigators that he and O'Malley talked salary. He told O'Malley "he would make more money doing the repairs for the SSD (school district) and would accept that type of payment in lieu of a salary," according to the presentment.

"Sansky stated that he told O'Malley that he wanted health insurance benefits as a condition of accepting the position of fleet manager," the presentment says. "According to Sansky, this request for benefits was granted."

DePasquale said the conversation between Sansky and O'Malley doesn't matter "whether that happened or not."

"All I know is if that (granting the Sanskys health insurance) happened, that's inappropriate and wrong," DePasquale said.

Contact the writer: [email protected]; 570-348-9147; @BorysBlogTT on Twitter.

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