Corporate Compliance

Colorado Medicaid failed to implement all OIG recommendations

Healthcare Auditing Weekly, September 9, 2008

Colorado’s Medicaid Drug Rebate Program only partially implemented the recommendations in the OIG’s 2005 audit and still needs improvement, according to a follow-up OIG audit.  
The Colorado Medicaid agency is negotiating a settlement with CMS over the alleged $1.9 million repayment the OIG recommended after the 2005 audit, according to the report. In addition, the state agency claimed it withheld 1.44% for Family Planning drug rebates when it actually withheld 1.3%. The calculations for the claims were based on inaccurate estimates.
According to the follow-up audit, the state agency has procedures in place to resolve outstanding disputes, but has $861,924 in manufacturer balances that were more than three years past due. The state agency also failed to report $22,399 of interest it received.
 The OIG has recommended the Colorado Medicaid agency:
  • Continue to work with CMS to determine and finalize a settlement of the prior recommendation that the state agency refund $1.9 million
  • Work with CMS to determine the actual amount of the $1,829,501 in drug rebates from the current audit period that relate to the Medicaid program, OAP program, and Family Planning
  • Actively pursue settlement of the disputed amounts and utilize available dispute resolution resources
  • Refund $22,399 for the federal share of interest that was received but not reported 
  • Develop policies and procedures to accurately report Medicaid Drug Rebate activity  
To read the full OIG report click here


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