Tuesday, December 10, 2013

CMS Should Ensure States Report Medicaid Overpayments

By Dianne De La Mare

The US General Accounting Office (GAO) has released a report, Medicaid:  CMS Should Ensure that States clearly Report Overpayments, that indicates despite the $9.8 million in Medicaid overpayments recovered by the states, they did not clearly report the overpayments or the return of the federal share to the US Department of Health, Centers for Medicare & Medicaid Services (CMS).  Federal audits initially identified about $20.4 million in potential Medicaid overpayments across the 19 states with identified overpayments (from June 2007-Feburary 2012).  According to the report, there were $7.1 million in reductions, primarily due to successful provider appeals and settlements.  Of the $13.3 million in net overpayments remaining, states recovered $9.8 million, and were in the process of recovering the remaining $3.5 million.  States should have reported the return of the federal share for $13.3 million on the line designated for overpayments identified by the national audit program contractors on the form that states fill out quarterly to obtain federal reimbursement for Medicaid services (Form CMS-64).  However, states made multiple reporting errors on Form CMS-64.  Further, CMS generally reviewed the states’ reporting of overpayments; but was not always aware of incomplete reporting.  All 7 CMS regional offices who GAO spoke to about this report, indicated that reviewing states’ reporting of the return of the federal share of overpayments was a routine part of their quarterly review of the Form CMS-64 and helped to ensure the timely return of the federal share of overpayments.  In some cases, however, the regional offices were not always aware that states’ reporting was incomplete.  Currently, reviewing the data on the Form CMS-64 will not yield a clear picture of the return of the federal share of overpayments.  GAO recommends that CMS increase its efforts to ensure that states are clearly reporting overpayments identified by federal audits in the designated location of the Form CMS-64.  To obtain a complete copy of the report, click here.

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