Review of Louisiana's Accounts Receivable System for Medicaid Provider Overpayments

EXECUTIVE SUMMARY:

This review was part of a multistate audit.  Our objective was to determine whether Louisiana (the State) reported Medicaid provider reclaiming adjustments and overpayment adjustments in accordance with Federal requirements.  The State did not report all Medicaid provider reclaiming adjustments and overpayment adjustments in accordance with Federal requirements. Fourteen of the 18 reclaiming adjustments that we reviewed, totaling $1,137,456 ($836,391 Federal share), were improper.  In addition, the State did not report seven overpayment adjustments totaling approximately $4.03 million ($2.87 million Federal share) on the Quarterly Medicaid Statement of Expenditures for the Medical Assistance Program, Form CMS-64 report  (CMS-64s) for the quarters in which the 60-day discovery periods ended.  This resulted in a potentially higher interest expense to the Federal Government of approximately $12,419.

We recommended that the State:  (1) refund to the Federal Government $836,391 in improper reclaiming adjustments; (2) revise reporting and writeoff procedures to ensure that improper reclaiming adjustments are not included on the CMS-64; (3) revise written policies and procedures to ensure that future overpayments are reported timely on the CMS-64s, thereby mitigating the potentially higher interest expense to the Federal Government; and (4) establish and implement written policies and procedures, and monitor new policies and procedures already implemented by the Medicaid Fraud Control Unit, to ensure coordination among all responsible State offices so that future reclaiming adjustments and overpayment adjustments are reported in accordance with Federal requirements.  The State disagreed with our findings that it did not report 14 of the 18 overpayment reclaiming adjustments and asserted that the recommended refund of $836,391 should be reduced.  It agreed with the remaining recommendations.