Arizona Improperly Claimed Federal Reimbursement for Medicare Part B Premiums Paid on Behalf of Medicaid Beneficiaries

Based on our sample results, we estimated that Arizona (the State) improperly claimed $13 million in Federal reimbursement for ineligible Medicare Part B premiums. A State may claim Federal reimbursement for the Part B premiums paid on behalf of an individual who meets certain eligibility requirements. However, the State claimed Federal reimbursement for Part B premiums paid on behalf of individuals who did not meet the eligibility requirements of any of the specified categories.

The State submitted unallowable claims because, according to State officials, it believed that CMS guidance permitted claiming of Federal reimbursement for Part B premium payments for individuals who were not eligible for any of the specified categories. However, after discussions with CMS, we concluded that this guidance did not permit Federal reimbursement to be claimed for Part B premium payments for individuals who were not eligible for any of the specified categories.

We recommended that the State (1) refund to the Federal Government $13 million (Federal share) for unallowable Part B premiums claimed and (2) review claims for Part B premiums paid before our audit period and refund the Federal share of any unallowable amounts claimed. The State did not concur with our recommendations.