Audit of Medicaid Payments for Oxygen Related Durable Medical Equipment and Supplies, January 1, 1998 Through December 31, 2000 - Texas Health and Human Services Commission, Austin, Texas

EXECUTIVE SUMMARY:

The objective of this audit was to determine if the Texas 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 $3.2 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.  We recommended that the State refund $3,181,518 (Federal share $1,969,704) and limit the maximum allowable price for DME and supplies to amounts equal to or less than the Medicare allowable amount for the same items.  A State agency official generally concurred with our recommendations.