Audit of Medicaid Provider Accounts Receivable Overpayments in Iowa

EXECUTIVE SUMMARY:

The objectives of this audit were to determine whether records maintained by the Iowa Department of Human Services (Iowa) supported the accounts receivable for overpayments reported to the Centers for Medicaid and Medicare Services (CMS), and whether Iowa developed adequate policies and procedures to ensure the collection of those overpayments.  We found Iowa lacked sufficient internal controls with regard to Medicaid accounts receivable overpayments.  Specifically, Iowa did not; (1) account for overpayment receivables according to generally accepted accounting principles, (2) report collections correctly to CMS, and (3) meet the 60-day reporting requirement prescribed by Federal regulations.  These issues occurred because Iowa did not account for overpayment receivables in a formal bookkeeping system, follow the State Medicaid Manual reporting instructions, and develop adequate policies and procedures.