Review of Empire Blue Cross Blue Shield's Compliance With the Medicare Secondary Payer Statutory Provisions

EXECUTIVE SUMMARY:

This final audit report estimates that over an 82 month period, Empire Blue Cross Blue Shield, a Medicare contractor, improperly paid $85 million in claims with Medicare as primary payer when the Empire private lines of business should have been the primary payer for services provided. In addition, the Office of Inspector General (OIG) was unable to render an opinion on an additional $118 million in potential improper payments since either Empire customers did not cooperate with our audit or we were unable to contact customers using data supplied by Empire. We are recommending that the Health Care Financing Administration (HCFA) negotiate a reasonable settlement with Empire taking our estimates of improper payments into account. The HCFA concurred with this recommendation.