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Department of Health and Human Services

Office of Inspector General -- AUDIT

"Review of the Anthem Blue Cross and Blue Shield of Connecticut Fiscal Intermediary's Compliance with Medicare Laws and Regulations," (A-01-98-00513)

June 21, 1999

Complete Text of Report is available in PDF format (261 kb). Copies can also be obtained by contacting the Office of Public Affairs at 202-619-1343.


The primary objective of our review was to determine whether Anthem paid for services which were: (1) furnished by certified Medicare providers to eligible beneficiaries; (2) reimbursed in accordance with Medicare laws and regulations; and (3) medically necessary, accurately coded, and sufficiently documented in the beneficiaries' medical records. Our reviews at Anthem and several contractors nationwide were performed as part of our responsibilities under the Chief Financial Officers (CFO) Act of 1990. Through detailed medical and audit review of a statistical selection of 50 beneficiaries representing 171 provider claims processed for payment by Anthem, we identified 28 improper Medicare payments totaling $65,917 of $635,823 reviewed. We found these payments were not in compliance with various Medicare laws and regulations requiring that services be medically necessary, sufficiently documented, and coded correctly. We recommend that Anthem adjust its Medicare accounts for the improper claims and initiate overpayment recovery from the identified providers. The Anthem concurred with the finding and has initiated overpayment recovery from the identified providers. We also identified control weaknesses which could impact Anthem's ability to record and report accurate financial data. The Anthem generally concurred with the identified control deficiencies and has initiated corrective actions.