Federal Reports

Most of the New Jersey Department of Human Services' (State agency) claims for Federal Medicaid reimbursement for partial care services did not comply with Federal and State requirements. The partial care services program provides individualized outpatient clinic services (e.g., group and individual therapy, prevocational services, and medication management) to beneficiaries with mental illness to reduce unnecessary hospitalization. On the basis of our sample results, we estimated that the State agency improperly claimed at least $94.8 million in Federal Medicaid reimbursement for partial care services that did not meet Federal and State requirements.

Connect for Health Colorado (Colorado marketplace), the health insurance exchange established by the State of Colorado under the provisions of the Patient Protection and Affordable Care Act, did not expend $9.7 million of Federal establishment grant funds in accordance with Federal requirements. Specifically, the Colorado marketplace (1) did not adequately document costs that it charged to the establishment grants ($4.4 million); (2) charged costs to the establishment grants for unallowable contract costs whose periods of benefit occurred after December 31, 2014 ($4.5 million), which was contrary to Centers for Medicare & Medicaid Services guidance regarding the expenditure of establishment grant funds; (3) improperly transferred costs from one establishment grant to another without demonstrating that the transfers were performed to correct bookkeeping or clerical errors ($312,000); and (4) did not efficiently and effectively administer establishment grant funds including improperly awarded bonuses, overpayments to subgrantees, unallowable promotional giveaway items, excessive and unreasonable tips, vendor rebates that were not credited to the establishment grants, and unallowable social activities ($463,000).

Claims for outpatient physical therapy services provided by a physical therapy practice (the practice), with offices located in Southern California, did not comply with Medicare requirements. Specifically, of the 100 beneficiary days in our random sample, the practice properly claimed Medicare reimbursement for 68 beneficiary days. However, the practice improperly claimed Medicare reimbursement for the remaining 32 beneficiary days, which had therapy services that were not medically necessary. On the basis of our sample results, we estimated that the practice improperly received at least $267,000 in Medicare reimbursement for outpatient physical therapy services that did not comply with Medicare requirements.

An audit report required by the Accountability of Tax Dollars Act of 2002.