New Jersey Claimed Medicaid Hospice Services That Were Not in Compliance With Federal and State Requirements

The State agency claimed Federal Medicaid reimbursement for some hospice services that did not comply with Federal and State requirements. Of the 150 beneficiary-months in our random sample, 108 complied with Federal and State requirements, but 42 did not.

The deficiencies occurred because the State agency did not monitor hospices for compliance with certain Federal and State requirements until after our audit period, when it implemented a postpayment review process for hospice services. On the basis of our sample results, we estimated that the State agency improperly claimed at least $8.4 million in Federal Medicaid reimbursement for hospice services that did not meet Federal and State requirements.

We recommended that the State agency (1) refund $8.4 million to the Federal Government and (2) continue to monitor hospices to ensure that they comply with Federal and State requirements. State agency officials stated they would not be providing comments to our report but rather would respond to the Centers for Medicare & Medicaid Services after we issue the final report.