Audit of Medicaid Payments for Oxygen Related Durable Medical Equipment and Supplies - January 1, 1998 through December 31, 2000 - Pennsylvania Department of Public Welfare, Harrisburg, Pennsylvania

EXECUTIVE SUMMARY:

The objective of this review was to determine if the Pennsylvania Medicaid program was reimbursing providers amounts in excess of State Medicare limits for durable medical equipment (DME) and supplies used to provide oxygen.  We found that the Medicaid program was overcharged approximately $3.4 million due to excessive Medicaid reimbursement rates.  The excessive reimbursements occurred because the State agency set the reimbursement limits for these items above the dollar amount allowed for similar items under the Medicare program and other State Medicaid programs.  We recommended that the State refund the Medicaid program $3,378,481 (Federal share $1,813,649) for excessive reimbursements to providers and limit the maximum allowable price for DME and supplies to an amount equal to or less than the Medicare allowable amount for the same items.  A State agency official generally concurred with our recommendations.