Review of Medicaid Claims for Patients Under Age 21 in Private Psychiatric Hospitals That Were Institutions for Mental Diseases in California During the Period July 1, 1997, Through January 31, 2001

EXECUTIVE SUMMARY:

The objective of this audit was to determine if controls were in place to preclude California from claiming Federal Medicaid funds for medical services, except inpatient psychiatric services, provided to residents under age 21 in private psychiatric hospitals that were institutions for mental diseases.  We found that California improperly claimed Federal funds because it did not have controls to prevent claims for medical services.  As a result, from July 1, 1997, through January 31, 2001, we estimate that California improperly claimed $310,266 ($155,133 Federal share) for such medical services.  We recommended that California (1) refund $155,133 to the Federal Government; (2) implement controls to prevent Federal funds from being claimed for such medical services; and (3) identify and refund to the Federal Government any Federal Medicaid funds improperly claimed after January 31, 2001.