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Audit (A-09-11-02024)

07-25-2012
Nevada Improperly Claimed Federal Reimbursement for Medicare Part B Premiums Paid on Behalf of Medicaid Beneficiaries

Executive Summary

Nevada did not always comply with Federal requirements when claiming Federal reimbursement for Medicare Part B program (Part B) premiums that it paid on behalf of Medicaid beneficiaries. Federal law allows State Medicaid programs to enter into an arrangement with CMS known as the buy in program. The buy in program allows a participating State Medicaid program to enroll certain dual eligibles (individuals who are entitled to both Medicare and some form of Medicaid benefits) in Part B and to pay the monthly premiums on their behalf. The State may then claim the monthly premium expenditures for Federal reimbursement.

We found that the State improperly claimed $179,000, which represented the Federal share of $336,000 in Part B premiums paid for ineligible individuals. For $903,000 in Part B premiums that the State claimed for public welfare additions, we judgmentally selected 18 of these additions and determined that the State claimed $25,000 ($16,000 Federal share) for 7 individuals who had been erroneously added. Because our judgmental selection identified unallowable claims for erroneous additions, some of the remaining claims likely are unallowable. Therefore, we have set aside $878,000 for resolution by CMS and the State.

For approximately $72.8 million of the Part B premiums claimed on the Form CMS 64, the State did not have adequate supporting documentation. For this reason, we could not determine whether the State's claims were allowable. Therefore, we have set aside approximately $72.8 million for resolution by CMS and the State.

We recommended that the State: (1) refund to the Federal Government $195,000 (Federal share) for unallowable Part B premiums claimed, (2) work with CMS to determine whether any portion of the $878,000 in Part B premiums claimed for public welfare additions was unallowable and refund the Federal share of any unallowable amount claimed, (3) work with CMS to determine the allowability of the approximately $72.8 million in Part B premiums for which the State did not have adequate supporting documentation and refund the Federal share of any unallowable amount claimed, (4) delete ineligible individuals from the buy in program when it determines that they are ineligible and refund the Federal share of the Part B premiums claimed for those individuals, (5) verify the eligibility of individuals added to the buy in program through the public welfare addition procedure and take corrective action on erroneous public welfare additions, (6) coordinate with Social Security Administration and CMS regional offices to establish procedures to reduce the number of erroneous public welfare additions, and (7) ensure that it can support the Federal share claimed for each Part B premium. The State described corrective actions that it had taken or planned to take but did not concur with the language in the finding related to inadequate support for Part B premiums.

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