Department of Health and Human Services

Office of Inspector General -- AUDIT

"Review of the Medicaid Drug Rebate Program State of Wisconsin, Wisconsin Department of Health and Family Services, Madison, Wisconsin," (A-05-03-00046)

September 22, 2003


Complete Text of Report is available in PDF format (194 kb). Copies can also be obtained by contacting the Office of Public Affairs at 202-619-1343.


EXECUTIVE SUMMARY:

OIG evaluated whether the Wisconsin Department of Health and Family Services (Agency) had established adequate accountability and internal controls over the State's Medicaid drug rebate program.  We determined that the Agency had not reconciled the outstanding balance of drug rebate accounts receivable, reported on the Form CMS 64.9R report, to the supporting records, or established adequate procedures to accrue interest for late or disputed rebate payments.  We recommended that the Agency (1) correct the outstanding balance on Form CMS 64.9R for an understatement of $3,329,034, and (2) develop procedures to (a) ensure that the reported outstanding rebate amount is reconciled with the supporting records and (b) to account for the interest related to late, disputed, or unpaid rebate payments.  The Agency generally agreed with our recommendations, except for developing procedures to account for the interest.  We agree with the corrective action taken, to date, while maintaining our belief that the Agency should establish procedures to verify that the correct interest was paid for unpaid, late, and disputed drug rebates.