Review of Calendar Year 1999 and 2000 Cost Reports Submitted by Scott & White Health Plan to the Centers for Medicare and Medicaid Services for Reimbursement

This final report points out that the Scott and White Health Plan (Plan) overstated costs claimed on both its 1999 and 2000 Medicare cost reports by about $8.2 million.  In addition, the Plan was not in compliance with the financial disclosure requirements for related party administrative costs totaling about $14 million for both 1999 and 2000.  We recommended that the Plan file amended Medicare cost reports for 1999 and 2000 decreasing the amount claimed by $8.2 million.  We also recommended that the Plan; (1) adhere to the reporting requirements for disclosing significant related party transactions, (2) make sure that the duplicate payment controls are functioning properly, and (3) file amended Medicare cost reports for errors impacting prior years.  The Plan generally concurred with our recommendations.