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The Regence Group (Regence), a Centers for Medicare and
Medicaid Services contractor, underclaimed $260,000 of Medicare pension costs on
its Oregon and Common Working File (CWF) Final Administrative Cost Proposals (FACP)
for fiscal years (FY) 1997–2006. Regence also underclaimed $665,000 of Medicare
pension costs on its Utah FACPs for FYs 1998–2006. Regence administered
both Medicare Part A and Part B operations under cost reimbursement contracts
with CMS until the contractual relationship was terminated November 30, 2005.
We recommended that Regence (1) revise its Oregon and CWF FACPs for FYs 1997–2006 to claim the additional allowable pension costs of $260,000 and (2) revise its Utah FACPs for FYs 1998–2006 to claim the additional allowable pension costs of $665,000. Regence concurred with the audit results but stated that the “. . . scope of this audit is limited to the Medicare Part A and Part B cost reimbursement contracts that terminated on November 30, 2005 and does not include the Oregon Medicare Data Center contract which terminated on December 31, 2006.”