SOUTH BEND, Ind. (AP) — A federal audit recommends that Indiana’s human
services agency refund the federal government nearly $39 million it overpaid
to Medicaid providers during a nine-year period.
The Indiana Family and Social Services Administration is preparing a
response and doesn’t anticipate having refund any money, spokesman Marcus
Barlow said Wednesday.
“We are concurrently constructing our response to the audit and gathering
substantive documentation to validate the state’s position,” he said.
The audit was performed by the U.S. Department of Health and Human Services
inspector general. Spokesman Donald White said what typically happens in
such cases is representatives with the federal Centers for Medicare and
Medicaid Services meet with state officials to negotiate a settlement.
“They meet to determine exactly how much money, if any money, should be
repaid to the federal government and how that repayment will be made,” he
CMMS spokeswoman Elizabeth Surgener said the agency has begun working with
Indiana, but said she could not provide any additional information.
According to the audit, which is dated Oct. 26, Indiana failed to report
Medicaid overpayments totaling $61.6 million from fiscal years 2000-2008 as
required. The federal share of that money is $38.9 million.
The report says 20 of the overpayments were for more than $1 million. In
response in July to a draft report of the audit, Patricia Casanova, the
state director of Medicaid, wrote that the overpayments of more than $1
million were had “either been repaid, reported or resolved” and asked for
the opportunity to work on a resolution on the remaining items included in
The audit also says the state failed to report $62,000 in interest earned on
the overpayments, as required by federal law, and claims the federal share
of that interest is $39,000.
“The state agency did not properly report these overpayments because it had
not implemented internal controls to ensure that overpayments were
reported,” the audit says.
Barlow said the state has improved its internal system controls to ensure
the proper recording and reporting of overpayments.
The audit comes as Indiana faces tough economic times. State Budget Director
Adam Horst said earlier this month that Indiana general fund revenues trail
the latest forecast by $15.7 million through the first four months of fiscal
2011. Gov. Mitch Daniels ordered 15 percent cuts in state agency spending
for the fiscal year that began in July, and the state is spending its
reserves to help make up for revenue shortfalls.
HHS Office of Inspector General’s report: