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Department of Health and Human Services

Office of Inspector General -- AUDIT

"Review of Medical and Ancillary Medicaid Claims for 21 To 64 Year Old Residents of Private Psychiatric Hospitals That Are Institutions for Mental Diseases in California During The Period July 1, 1997 Through January 31, 2001," (A-09-02-00079)

December 17, 2002

Complete Text of Report is available in PDF format (1.48 MB). Copies can also be obtained by contacting the Office of Public Affairs at 202-619-1343.


This report provides the results of our review of medical and ancillary claims for 21 to 64 year old residents of private psychiatric hospitals that are institutions for mental diseases in California during the period of July 1, 1997 through January 31, 2001.  This audit is part of our ongoing review of Medicaid billings for patients in institutions for mental diseases (IMD).  The objective of our review was to determine if the state of California had adequate controls to preclude claiming federal financial participation (FFP) under the Medicaid program when 21 to 64 year old residents of private IMDs received physician services, laboratory and clinic services, and hospital outpatient treatment.  Federal Medicaid law and regulations prohibit FFP for this care.  We determined that although the state did not have specific edits to prevent it from claiming FFP, only a minor amount of unallowable FFP was claimed under Medicaid for medical and ancillary services.  We concluded that the state substantially complied with federal rules prohibiting claims of FFP under the Medicaid program for medical and ancillary services provided to residents 21 to 64 year old in the state’s 26 private psychiatric hospitals that were IMDs.