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Unreported Medicaid overpayments in South Dakota

Healthcare Auditing Weekly, July 19, 2005

South Dakota did not report all or part of 342 Medicaid provider overpayments, totaling $229,792, which were due before or during fiscal year (FY) 2003, according to an OIG audit report. The state agency did not have sufficient policies and procedures in place to ensure it reported all overpayments pursuant to federal regulations, the audit found.

The OIG recommends that South Dakota return the federal government's share of overpayments, totaling $154,741; ensure that the federal share of all Medicaid provider overpayments is returned within established timeframes; and strengthen its policies and procedures. Although the state agency agreed with two of the OIG's findings, it disagreed with the amount of overpayments, including three overpayments it claimed it made to individuals rather than providers.

During the audit, the OIG did the following:

• Reviewed applicable federal criteria and state laws and regulations

• Interviewed South Dakota officials and staff responsible for identifying and monitoring collections of overpayments, and for reporting the federal share of overpayments

• Reviewed overpayment case files and information provided by the Medicaid Fraud Control Unit

• Compared the CMS 64 reports submitted to CMS by the state agency to supporting documentation

• Verified the collection of some overpayments with information provided from the state agency's Medicaid Management Information System

• Analyzed information to determine if the state agency reported overpayments accurately and on time

• Applied a cutoff date for the overpayments due prior to or during FY 2003 that remained unreported during the audit

• Calculated potential lost interest

Click here to read the audit report, "Review of South Dakota's Accounts Receivable System for Medicaid Provider Overpayments," (A-07-05-03072), issued June 8.

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