Audit of Administrative Costs Claimed Under Parts A & B of the Health Insurance for the Aged and Disabled Program - Associated Insurance Companies, Inc., Indianapolis, Indiana

This final audit report points out unallowable costs of about $4 million claimed by Associated Insurance Companies, Inc. for Fiscal Years 1990 through 1993. The unallowable costs consisted of, and we recommended financial adjustments for: $2.4 million for credits due the Medicare program; $0.5 million for executive salary increases which exceeded the average increases for comparable positions, as measured by the Federal Bureau of Labor Statistics; $0.3 million for unfunded pension costs; $0.2 million for professional consultant services unrelated to Medicare; $0.2 million for indirect costs that were for non-Medicare related activities; and $0.4 million for various items which were unsupported, not in accordance with Federal regulations, or did not benefit the Medicare program.