Federal Reports

Qualified aliens are generally not permitted to receive Federal Medicaid benefits for 5 years from the date they enter the United States with qualified alien status. States are required to have a verification system to meet requirements for receiving Federal reimbursement for services provided to qualified aliens. To comply with those requirements, the California Department of Health Care Services (State agency) created the quarterly alien claiming adjustment report (adjustment report) in its Medicaid Management Information System (MMIS) to identify claims for services provided to qualified aliens who had not met, and were not otherwise excepted from, the 5-year waiting period.

Northside Medical Center (The Hospital), in Youngstown, Ohio complied with Medicare billing requirements for diagnosis codes 261 and 262 for 2 of the 100 claims that we reviewed. However, the Hospital did not comply with Medicare billing requirements for the remaining 98 claims. For two of these claims, the medical record documentation supported a secondary diagnosis code other than 261 or 262, but the error resulted in no change to the diagnosis-related group or payment. For the remaining 96 claims, the billing errors resulted in overpayments of $464,000. These errors occurred because the Hospital used diagnosis code 261 or 262 when it should have used codes for other forms of malnutrition or no malnutrition diagnosis code at all. On the basis of our sample results, we estimated that the Hospital received overpayments of at least $1.28 million over 2 and a half years.