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Audit: UMDNJ's DSH payments exceed limit by more than $20 million

Healthcare Auditing Weekly, July 31, 2007

In one of its most recent audits, the OIG set out to review Medicaid disproportionate share hospital (DSH) payments at the University of Medicine and Dentistry of New Jersey's University Behavioral Healthcare Center.

Specifically, the OIG wanted to see whether the healthcare center's DSH payments complied with hospital-specific limits imposed by the Social Security Act (SSA) and other state and federal requirements.

The OIG concluded that DSH payments to healthcare center exceeded the hospital-specific limits imposed by the SSA and other state and federal requirements by more than $20 million. The OIG said it was unable to determine the reasonableness of $9.9 million of costs included in the center's hospital-specific DSH limits because the contractor included an undetermined amount of costs for patients with private insurance coverage.

New Jersey officials told the OIG that they had relied on the contractor to prepare the DSH claims and that, contrary to federal requirements, they had not ensured the veracity of those claims before submitting them for federal reimbursement.

The OIG recommended that:

• New Jersey refund $10 million to the federal government
• work with CMS to resolve $4.9 million in set-aside costs
• adhere to federal law and state requirements when submitting DSH claims subsequent to June 2001 for federal reimbursement
• review all work performed by consultants to ensure the veracity of future Medicaid claims to the federal government

New Jersey officials generally agreed with the findings and recommendations, the agency said. 

Click here to read the entire OIG audit.

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