Medicare Compliance & Reimbursement

An audit of Medicaid billings proves costly for state.

When the feds order hefty paybacks from already meager state Medicaid budgets, providers will ultimately pay the price.

The Oklahoma Department of Human Services, which administers the state's Medicaid program, must pay back the federal government more than $11 million for unallowable and wrongly categorized Medicaid claims, according to a recent Health and Human Services Office of Inspector General report.

From 1997 to 2003, the OKDHS inappropriately charged the federal government $39.75 million in targeted case management costs as administrative costs, the OIG says. Targeted case management costs are separately reimbursed as a direct Medicaid service. The OKDHS made adjustments to correct these errors, but still needs to offset more than $9 million of the federal share, according to the OIG.

Outcome: OKDHS should reimburse the federal government for $1.8 million it received for unallowable administrative costs, including lawsuit settlement costs, cost adjustment errors and university indirect costs, the OIG recommends.

The OIG also wants the OKDHS to correctly claim targeted case management costs and refund the $9 million federal share.

To read the audit, go to http://www.oig.hhs.gov/oas/reports/region6/60300046.pdf.