After a tumultuous first year in office - and with promised reforms in Albany often falling far short of expectations - New York Gov. Eliot Spitzer has made spectacular progress on one of his campaign promises: cutting waste and fraud out of the state's Medicaid spending.

Changes in the way the state Health Department operates have saved the state about $1 billion this year.

Big savings were realized when the Health Department changed the way it compensated doctors, hospitals and nursing homes that appeared to be trying to recoup their high labor costs at the expense of the system.

Freshman Attorney General Andrew Cuomo likewise deserves credit for having his staff aggressively investigate Medicaid fraud, resulting in savings of about $110 million.

And state Comptroller Tom DiNapoli's office did its part, too, auditing bills from doctors' offices and catching more than $47 million in fraudulent claims.

So, where does the $1 billion in savings go?

Some was directed to other state health-care spending and some was used to pay down the state's enormous debt.

And because most fraudulent claims are discovered long after payments are made, the process of trying to get the money back becomes another problem altogether.

New York's Medicaid program costs $47 billion a year to operate, and more work remains to be done if it is to become more efficient and less susceptible to fraud.

Former Gov. George Pataki also worked to strengthen the anti-fraud arm of the program, but the state's new governor and its new attorney general have really made a big impact this year.

We hope to see even bigger savings in 2008.