Follow-Up Review of a Finding Contained in a New York State Office of the State Comptroller Audit Report on Duplicate School Health Claims to Medicaid Made by the New York City Board of Education

EXECUTIVE SUMMARY:

The objectives of this review were to determine if:  (1) New York State (NYS) recouped the improper duplicate school health payments made to the New York City Board of Education (NYC BOE) that were identified in the Office of the State Controller's (OSC) report and if the Federal Government received its share of the recoupments; (2) the NYC BOE ceased claiming for the duplicate school health claims; and (3) duplicate school health claims were made by and paid to the NYC BOE for the periods prior to and after the OSC's audit period of January 1, 1997 through December 31, 1999.  We found that although NYS recouped $30,548,090 ($15,274,045 federal share) of the duplicate school health claims made by the NYC BOE, and we had reasonable assurance that the Federal Government received its share of these recoveries, the recoupments were not made timely.  Our review noted that only $18,804,066 of the $30,548,090 had been recovered by January 2, 2001 and the balance, or $11,744,024, was not recovered until March 2002.  Thus, there was about a 14-month delay by the state in recovering $11,744,024 identified by the OSC.

We also determined that, for the most part, the NYC BOE ceased claiming for the duplicates after the OSC's December 31, 1999 audit cut-off date.  However, for the period prior to the OSC audit, we found that duplicate school and preschool claims were submitted by and paid to the NYC BOE.  In response to our audit, NYS officials identified and recouped $27,624,087 ($13,812,043 federal share) of duplicates in March 2002 for the period prior to the OSC audit period.  Our audit also identified an additional $5,642,918 ($2,821,459 federal share) of duplicates that needs to be recovered.  We recommended that NYS:  (1) recoup the additional $5,642,918 of duplicate claims identified by our audit and refund $2,821,459 to the Federal Government; and (2) recover all duplicate Medicaid payments when they are identified and return the federal share of these overpayments to the Federal Government within 60 days of discovery as required by applicable federal regulations.  NYS officials generally concurred with both recommendations.