Department of Health and Human Services

Office of Inspector General -- AUDIT

"Review of Medicaid Eligibility in California for the Period January 1 Through June 30, 2005," (A-09-06-00028)

February 28, 2007

Complete Text of Report is available in PDF format (489 kb). Copies can also be obtained by contacting the Office of Public Affairs at 202-619-1343.

EXECUTIVE SUMMARY:

This report is part of a multistate review requested by the Centers for Medicare and Medicaid Services (CMS) and the Office of Management and Budget. Our objective was to determine the extent to which the State agency made Medicaid payments on behalf of beneficiaries who did not meet Federal and State eligibility requirements. 

The State agency (1) made some Medicaid payments on behalf of beneficiaries who did not meet Federal and State eligibility requirements and (2) did not ensure that the county offices always adequately documented eligibility determinations. Of the 199 payments in our statistical sample, 17 payments totaling $480 (Federal share) were unallowable because the beneficiaries were ineligible for Medicaid. In addition, for nine sampled payments totaling $423 (Federal share), the case files were missing or did not contain adequate documentation supporting eligibility determinations. As a result, for the 6-month audit period, we estimate that the State agency made 4,705,170 payments totaling $132,727,302 (Federal share) on behalf of ineligible beneficiaries. We also estimate that case file documentation did not adequately support eligibility determinations for an additional 2,490,972 payments totaling $117,020,338 (Federal share). 

We recommended that the State agency use the results of this review to help ensure compliance with Federal and State Medicaid eligibility requirements. Specifically, the State agency should (1) reemphasize to beneficiaries the need to provide accurate and timely information and (2) require county office employees to verify eligibility information and maintain appropriate documentation in all case files. The State agency agreed with our recommendation, but disagreed with our findings that one beneficiary was ineligible for the specific service received and that certain cases lacked adequate documentation to support eligibility determinations. The State agency also disagreed with the fiscal projection of the Federal share associated with the findings, but it acknowledged that supporting documentation was missing from certain case files.