Review of Medicaid Claims for Patients Between the Ages of 21 to 64 in New Jersey's Private and County-Operated Institutions for Mental Diseases

EXECUTIVE SUMMARY:

The objective of this review was to determine if controls were in place to preclude New Jersey from claiming Federal financial participation (FFP) under the Medicaid program for medical and ancillary services (except crossover claims to Medicaid for inpatient psychiatric services that were included in a prior report) made on behalf of 21 to 64 year-old residents of private and county-operated psychiatric hospitals that were institutions for mental diseases.  Our audit period was July 1, 1997 through June 30, 2001.  We found that New Jersey improperly claimed FFP for 68 of 110 claims in our statistical sample.  The improper claiming occurred because New Jersey did not have controls in place to prevent FFP from being claimed for medical and ancillary services provided to 21 to 64 year-old residents of private and county-operated psychiatric hospitals.  As a result, we estimate that New Jersey improperly claimed $170,770 of FFP.  Our report recommended that New Jersey refund $170,770 to the Federal Government, in addition to also had two procedural recommendations.  New Jersey officials concurred with our recommendations.