U.S. flag

An official website of the United States government

Dot gov

The .gov means it's official.
Federal government websites often end in .gov or .mil. Before sharing sensitive information, make sure you're on a federal government site.


The site is secure.
The https:// ensures that you are connecting to the official website and that any information you provide is encrypted and transmitted securely.

Department of Health and Human Services

Office of Inspector General -- AUDIT

"Administrative Costs Incurred Under Parts A and B of the Health Insurance for the Aged and Disabled Program - Arkansas Blue Cross and Blue Shield, Little Rock, Arkansas," (A-06-03-00013)

October 14, 2003

Complete Text of Report is available in PDF format (825 KB). Copies can also be obtained by contacting the Office of Public Affairs at 202-619-1343.


The objective of this audit was to determine whether the final administrative cost proposals fairly presented the costs of program administration.  Of the $234,056,106 in administrative costs claimed by Arkansas Blue Cross Blue Shield (Blue Cross) during fiscal years 1999 - 2002, we determined that a financial adjustment of $689,546 was necessary and that an additional $70,202 needed to be set aside for lack of documentation.  We recommended that the remaining $233,296,358 be accepted for reimbursement.  Blue Cross concurred with $624,952 of our recommended financial adjustments and disagreed with all of the $70,202 of set aside costs.