Department of Health and Human Services
Office of Inspector General -- AUDIT
"Review of Indiana Medicaid Disproportionate Share Hospital Eligibility for July 1, 2000, Through June 30, 2003," (A-05-06-00045)
May 13, 2008
Complete Text of Report is available in PDF format (3.07 mb). Copies can also be obtained by contacting the Office of Public Affairs at 202-619-1343.
For the period July 1, 2000, through June 30, 2003, the
State paid $142.3 million ($88.2 million Federal share) to three State-owned
psychiatric hospitals that were not eligible to receive Medicaid
disproportionate share hospital (DSH) payments. The hospitals did not meet
Federal Medicaid eligibility requirements because they did not comply with
Medicare conditions of participation (CoP) requirements. Generally, hospitals
demonstrate compliance with basic Medicare CoP through an accreditation process
performed by the Joint Commission on Accreditation of Healthcare Organizations
(JCAHO). Psychiatric hospitals must also meet additional staffing and medical
We recommended that the State refund $88.2 million to the Federal Government for the Medicaid DSH payments made to the three ineligible State-owned psychiatric hospitals for the audit period and ensure that Medicaid DSH payments are made only to eligible hospitals. The State disagreed with our finding and recommendations. The State agency believed that Medicare and Medicaid CoP had been met for the facilities through a combination of JCAHO accreditation and the Medicaid survey and certification process, including the special CoP for psychiatric hospitals. After reviewing the State agency’s comments, we maintain that our finding and recommendations are valid.