Review of the Island Peer Review Organization's Denials of Full Medical Assistance Claims That New York State Identified As Successfully Recovered Through the Automated Void Process

EXECUTIVE SUMMARY:

This final audit report presents the results of our audit to determine if full claim denials of inpatient hospital stays made by the Island Peer Review Organization (IPRO) were successfully processed and whether the Federal Government received its share of recoupments. Our audit disclosed that systems were generally adequate for processing voided transactions which resulted in recoupments from providers. However, we noted a significant system weakness in that certain hospitals improperly rebilled and were paid previously voided claims. We recommended that New York State work with IPRO and the affected providers to determine the appropriate overpayment amounts and recover these claims (Federal share estimated at $1.4 million), and develop appropriate procedures and controls within their system to ensure that previously denied and voided claims are not again reimbursed by Medicaid if they are resubmitted by providers.