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Audit (A-05-09-00027)

Review of Medicare Payments to Prescription Drug Plans on Behalf of Deceased Enrollees

Executive Summary

Our review found that the Centers for Medicare & Medicaid Services (CMS) made approximately $3.61 million of unallowable payments on behalf of deceased Medicare enrollees to prescription drug plan sponsors for coverage periods after the enrollees' months of death. CMS made improper payments for 1,500 of the 2.7 million deceased enrollees (far less than 1 percent of the enrollees who died). As of January 31, 2010, $3.61 million in improper payments remained uncollected. CMS's systems categorized these enrollees as alive or as having different dates of death than those listed in the Social Security Administration's death master file. Although CMS had correctly stopped payments for the vast majority of deceased enrollees, its systems did not always identify and prevent the improper payments. In addition, CMS did not always recover payments made on behalf of deceased enrollees on a timely basis.

We recommended that CMS (1) recoup the $3.61 million in payments for deceased Medicare enrollees, (2) recover improper payments in a timely manner, and (3) implement system enhancements to prevent and detect future improper payments for deceased enrollees. CMS concurred with our recommendations but said that it believed it had recovered the $3.6 million in payments made for deceased Medicare enrollees. Nothing in CMS's comments caused us to change our findings or recommendations. As of January 2010, CMS had not recouped the payments.

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