Review of Duplicate Acute Care Hospital Expenditures Claimed by the State of New Jersey to the Disproportionate Share Hospital Program

EXECUTIVE SUMMARY:

This final report points out that New Jersey claimed duplicate reimbursement for acute care hospital claims totaling approximately $54.9 million (federal share $27.5 million) under the disproportionate share hospital (DSH) program.  The state blamed the error on a computer system's error of a contractor hired by the state, on a contingency fee basis, to generate increased federal reimbursement by identifying and submitting state expenses not previously claimed.  We recommended that New Jersey refund $30.4 million (which includes interest applicable to the overpayment) to the Federal Government.  We also recommended that the state thoroughly review all work performed by outside contractors and consultants to assure the veracity of future claims to the Federal Government.