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Department of Health and Human Services

Office of Inspector General -- AUDIT

"Review of Medicare Payments for Beneficiaries with Institutionalized Status at Health Net of California," (A-07-05-01013)

October 7, 2005

Complete Text of Report is available in PDF format (184 kb). Copies can also be obtained by contacting the Office of Public Affairs at 202-619-1343.


The objective of our review was to determine if Health Net reported beneficiaries as institutionalized for enhanced Medicare reimbursement pursuant to Federal laws and regulations.  We found that Health Net incorrectly reported 82 beneficiaries as institutionalized for enhanced Medicare reimbursement.  As a result, Health Net received Medicare overpayments of $293,885.  The errors occurred because Health Net did not have adequate internal controls to ensure that it correctly classified beneficiaries as institutionalized.

We recommended Health Net refund $293,885 to the Federal Government and ensure that its controls are adequate to correctly classify beneficiaries as institutionalized pursuant to Federal laws and regulations.  Health Net concurred with our findings and recommendations.