ALBANY— For years, Staten Island University Hospital claimed 21 of its clinics were operated part time, which allowed the hospital to charge Medicaid rates up to eight times higher than normal for services. But after an investigation, the hospital last year agreed to repay the state $76.5 million state officials said it acquired through fraud.

The major party candidates for attorney general agree that’s the kind of institutional fraud and waste that consumes billions of dollars each year in the $44.5 billion Medicaid system that provides health care to the poor. But they differ substantially on how the system should be fixed.

Democrat Andrew Cuomo wants the Legislature to pass a False Claims Act based on the federal law that allows whistleblowers who hire lawyers to sue on behalf of the government and keep some of the recovered money.

Republican Jeanine Pirro says such a law isn’t needed and argues a greater share of the office’s funding should be allocated to investigate sophisticated fraud schemes.

No one doubts reforms are needed. New York’s Medicaid system costs more than California’s and Texas’ combined.

“The Medicaid system in New York needs a major fix,” said Neil Getnick, a Manhattan lawyer and a member of Taxpayers Against Fraud.

Peter Pope, the deputy attorney general in charge of the office’s criminal division under Eliot Spitzer, said fighting fraud is not easy.

Mrs. Pirro said she wants to increase the use of surveillance, undercover agents, informants and computer technology to boost fraud recoveries. The attorney general’s office has used those techniques to help raise the amount recovered to $219 million in 2005, from $10.6 million in 1998, Mr. Pope said.

Mrs. Pirro also pledged to have investigators with the attorney general’s office work closer with the Health Department in tracking down Medicaid cheats.

She has promised to put those convicted of Medicaid fraud behind bars and said eliminating scams is the “clearest opportunity” the attorney general has to reduce the state’s tax burden without cutting government services.

In New York, Medicaid is paid for by federal, state and local taxes and has been blamed for driving up property taxes as counties struggle to meet its rising costs.

Mr. Cuomo has said he supports enacting a state False Claims Act, among other measures.

While the Legislature has passed some bills targeting Medicaid fraud, the measures have not included the whistleblower provisions favored by Mr. Cuomo and Mr. Spitzer, who is running for governor.Lawmakers have also failed to change old statutes that make it harder for prosecutors to bring charges, Mr. Pope said.

Mr. Cuomo said he would also propose a law similar to the Martin Act.

Put on the books in 1921 to curb fraudulent investment advice, the Martin Act lets New York’s attorney general get convictions without proving criminal intent and gives him broad powers to subpoena documents and question witnesses. The law has been used by Mr. Spitzer to go after fraud on Wall Street.

Aides to Mr. Cuomo have said he thinks amnesty for Medicaid cheats might be worth considering as a way to recoup lost state tax dollars, but only after other measures are implemented to crack down on Medicaid fraud.