Outdated methods cost IL $56.5 million
Healthcare Auditing Weekly, June 14, 2005
Illinois used an out-of-date factor to convert billed charges to costs and did not have adequate policies and procedures in place to monitor cost outlier payments, according to an OIG audit report. As a result, the state's inpatient hospital cost outlier payments increased significantly and at a faster rate than other types of Medicaid payments. If the state had applied a more current factor to convert billed charges to costs, it could have saved approximately $56.5 million between 1998 and 2002 for the three hospitals the OIG reviewed.
The OIG recommends that Illinois revise its method of computing cost outlier payments and develop policies and procedures to more closely monitor cost outlier payments.
During the audit, the OIG did the following:
Click here to read the audit report, "Medicaid Hospital Outlier Payments in Illinois for the Period of State Fiscal Years 1998 Through 2002," (A-07-04-04031), issued May 12.
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