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Department of Health and Human Services

Office of Inspector General -- AUDIT

"Review of Administrative Costs and Contract Termination for Nationwide Mutual Insurance Company - October 1, 1998 Through September 30, 2002," (A-05-03-00094)

November 9, 2004


Complete Text of Report is available in PDF format (225 kb). Copies can also be obtained by contacting the Office of Public Affairs at 202-619-1343.


EXECUTIVE SUMMARY:

During the 4-year audit period, Nationwide claimed administrative costs totaling $144,268,652. Nationwide could not provide documentation to support costs claimed totaling $5,069,849 for travel, facilities, equipment, materials, postage, telephone, professional services, miscellaneous costs and sale of assets.  In addition, we are questioning a total of $1,384,752 for complementary credits, unallowable overhead allocations, and executive compensation.  Finally, Nationwide claimed costs totaling $1,543,938 on its termination voucher.  We are questioning $41,505 for the portion of the bonus for one employee in excess of the Centers for Medicare and Medicaid Services approved 30 percent rate.