Review of Medicaid Claims Made for 21 to 64 Year Old Residents of Institutions for Mental Diseases in Maryland

EXECUTIVE SUMMARY:

The objective of this review was to determine if controls were in place to effectively preclude the state of Maryland from claiming federal financial participation (FFP) under the Medicaid program for inpatient and other medical and ancillary services for 21 to 64 year old residents of psychiatric hospitals that are institutions for mental diseases (IMD).  The review showed that controls were not in place to effectively preclude the state from claiming such FFP.  From July 1, 1997 to June 30, 2000, the state improperly claimed $1,293,009 FFP for Medicaid claims made on behalf of residents at three state IMDs.  In addition, the state improperly claimed FFP for Medicaid waiver claims for residents of 12 IMDs in the amount of $800,720 from January 1, 1997 to December 31, 2000.  We recommended that Maryland refund $2,093,729 FFP and make other procedural changes.  The state generally disagreed with our findings and recommendations for improperly claimed FFP associated with inpatient acute care and other medical and ancillary claims paid on behalf of 21 to 64 year old IMD residents.