HHSOIG - A-02-15-01010 - 261430

We recommend the State agency refund $300,452,930 in Federal Medicaid reimbursement claimed based on payment rates that incorporated unallowable costs. This disallowance is based on $220,314,119 calculated by removing allowable costs and RMS study based on correct activity moments plus $80,138,811 which was claimed based on a pending amendments to its State plan. The $220,314,119 includes the effect of including unallowable costs in the rate pool as follows: -Unpaid Pension Costs-$435,287,077 -Unallowable disabilities teacher-consultant salaries $61,528,162 -Special education or non health related services $75,379,253 The rates were recalculated using corrected random moment timestudy activity codes that were changed by the State agency's contractor. The contractor recoded 235 of the employees' responses, we determined that 203 were incorrect.