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Department of Health and Human Services

Office of Inspector General -- AUDIT

"Review of State Fiscal Year 2002 Medicare Upper Payment Calculations and Payments:  Kentucky Medicaid Agency," (A-04-03-02029)

August 18, 2004

Complete Text of Report is available in PDF format (647 kb). Copies can also be obtained by contacting the Office of Public Affairs at 202-619-1343.


This report points out that overall, Kentucky’s inpatient hospital, outpatient hospital, and skilled nursing facility upper payment limit (UPL) payments were made within the terms of the approved State plan amendments.  In addition, Kentucky’s methodologies for the UPL calculations were reasonable.  However, some minor computational errors resulted in UPL overpayments of $75,748 (Federal share $52,926) associated with its inpatient hospital UPL calculations and $227,916 (Federal share $159,405) associated with its outpatient hospital UPL calculations.  We recommended that Kentucky reimburse the Federal Government $212,331 for the Federal share of the overpayments.  We also recommended that Kentucky improve procedures to review the UPL calculations for accuracy.