Review of Louisiana's Hurricane Katrina Healthcare Related Provider Stabilization Grant

Louisiana incorrectly recorded contract labor expenses and the number of hours contractors worked for 5 of the 60 hospitals that we reviewed. The Deficit Reduction Act of 2005 gave the Secretary of the Department of Health and Human Services the authority to make payments to eligible States for restoring access to health care in communities impacted by Hurricane Katrina. The State was awarded $97.9 million through an initial and a supplemental grant. As a result of the data entry errors, most of the hospitals received an incorrect grant payment, ranging from a $60,000 overpayment to a $61,000 underpayment.

We recommended that the State use the results of our review to adjust incorrect grant payments received by the hospitals. The State agreed with our recommendation.