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Department of Health and Human Services

Office of Inspector General -- AUDIT

"Audit of Administrative Costs Claimed Under Parts A and B of the Health Insurance for the Aged and Disabled Program for Fiscal Years 1994 and 1995, Blue Cross and Blue Shield of Michigan," (A-05-95-00059)

January 29, 1997

Complete Text of Report is available in PDF format (461 kb). Copies can also be obtained by contacting the Office of Public Affairs at 202-619-1343.


Blue Cross and Blue Shield of Michigan (BCBSM) claimed Medicare Parts A and B administrative costs for the period October 1, 1993 through October 31, 1994, totaling $54,475,362. Of the $54,475,362 in administrative costs claimed, we consider $52,688,017 to be acceptable and recommend a financial adjustment of $1,787,345 ($1,129,843 - Part A and $657,502 - Part B).

We found that Medicare costs were overstated because:

In their written response to our draft report, BCBSM generally did not concur with our findings and recommendations. We have summarized BCBSM's responses following the individual findings and recommendations and have provided our comments where appropriate.