Review of Medicare Payments for Beneficiaries Incarcerated in the State of Michigan

EXECUTIVE SUMMARY:

The objective of this review was to determine whether Medicare fee-for-service claims paid for beneficiaries incarcerated in Michigan during the 3-year period of January 1, 1997 through December 31, 1999 were in compliance with Federal regulations and Centers for Medicare & Medicaid Services guidelines. Michigan was 1 of 10 States selected for review. Generally, no Medicare payments should be made when a beneficiary is in State or local custody under a penal authority, since the State or other government component is responsible for providing medical care. We found in Michigan that three of the 100 sample claims were unallowable. The sample also included 63 claims for beneficiaries in psychiatric hospitals operated by the Michigan Department of Community Health. We determined that these beneficiaries did qualify for Medicare coverage because under State law, the beneficiaries were responsible for repayment of medical costs and the State did pursue collection. Thirty additional claims in our sample were also allowable because we believe the beneficiaries were not incarcerated on the day of the medical service. We were unable to determine the incarceration status of the beneficiaries for four claims in our sample.