U.S. flag

An official website of the United States government

Dot gov

The .gov means it's official.
Federal government websites often end in .gov or .mil. Before sharing sensitive information, make sure you're on a federal government site.


The site is secure.
The https:// ensures that you are connecting to the official website and that any information you provide is encrypted and transmitted securely.

Skip to Content

Department of Health and Human Services

Office of Inspector General -- AUDIT

"Review of Partial Hospitalization Services Provided Through Community Mental Health Centers," (A-04-98-02146)

October 5, 1998

Complete Text of Report is available in PDF format (1.73 mb). Copies can also be obtained by contacting the Office of Public Affairs at 202-619-1343.


This final report summarizes the results of reviews of partial hospitalization program (PHP) services provided at 14 community mental health centers (CMHC) in Florida and Pennsylvania. The reviews (performed jointly by staff from the OIG and HCFA) showed that in the 14 facilities; (1) certification requirements for qualifying as a CMHC were not always met, (2) most beneficiaries were found to be ineligible for PHP services, (3) many of the services provided to beneficiaries were not reasonable and necessary, and (4) provider cost reports contained costs that were not always allowable, reasonable, and necessary. As a result, improper payments to the 14 facilities totaled more than $31 million. Recommendations call for tightening requirements for CMHC certification, detailed review (including review of medical records) by the fiscal intermediary of the first claim for each new beneficiary receiving PHP services, and improvements to the cost reporting process. The HCFA generally concurred with these recommendations. The HCFA has also suspended Medicare payments to the 14 facilities and terminated the provider numbers of 10 facilities.