Review of Family Planning Services Claimed by Washington State During the Period October 1, 2005, Through September 30, 2008

Our review found that Washington State was overpaid $8.5 million for Medicaid family planning services and supplies during the period October 1, 2005, through September 30, 2008. This overpayment occurred because the State agency's Medicaid Management Information System (MMIS) controls did not properly distinguish claims eligible for reimbursement at the 90-percent rate from claims eligible for reimbursement at the regular Federal medical assistance percentage (FMAP) rate. The Federal share of the Medicaid program is determined by the FMAP, which was 50 percent during our audit period; family planning claims were reimbursed at 90 percent.

We recommended that the State (1) refund $8.5 million to the Federal Government and (2) identify and refund any overpayments for family planning claims before October 1, 2005, that did not contain approved primary diagnosis or therapeutic classification codes identifying the claims as eligible for reimbursement at the 90-percent rate. The State concurred with our findings and our first recommendation. Regarding our second recommendation, the State said that because it had implemented a new MMIS in May 2010, it was unable to review medical claims submitted before December 2005 or pharmacy claims submitted before April 2006.