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DCCUMENT RESUME
03500 - (A21139051 (Restricted)
(Cost Related Medicaid Reimbursements to Nursing Homes in the
State of Kansas]. September 8, 1977. 5 pp.
Report to Gene Hyde, Acting Regional Administrator, Health Care
Financing Aduimistration; by David A. Hanna, Regional Manager,
Field Operations riv.: Regional office (Kansas City).
Issue Area: Health Programs: Reimbursement Policies and
Utilization Controls (1208).
Contact: Field Operations Div.: Regional Office (Kansas City).
Budget Function: Health: Nursing Homes (557).
Organizaticn Concerned: Kansas City, No.
Controls and procedures used to reimburse nursing homes
in Kansas for services provided patients under the Medicaid
program were surveyed. The analysis focused on the State's
method of establishing reimbursement rates, selected program
providers' cost reports which the State used to establish these
rates, and four providers' records in order to verify the
propriety of selected costs included in the reports.
Findings/Conclusions: The State was not effectively identifying
and following up on questionable or unallowable provider costs.
As a result, some providers were reimbursed at rates higher than
justified on the basis of their allowable incurred costs. The
State's rcimtursement ceilings were raised because these
unallowable costs were included in the cost base the State used
to set rate ceilings. The State had erroneously raised the
reimtorsem3nt ceilings even further by including the cost base
estimated operatirg costs 'r new facilities and facilities
under new ownership. An examiAation -f provider cost reports
submitted during fiscal yeats 1975 and 1976 identified about
$700,000 that should have been disallowed either during desk
audits or followup field audits. Other costs were identified
which appeared improper but passed through desk audit
unchallenged. Unallowable costs not detected during desk audits
can result in increased payment rates to all providers whose
costs exceed the Statewide ceilings. Recommendations: The
Regional Administrator should monitor the State's progress in
correcting the deficiencies cited and should recover the Federal
portion of the overpayments found by the State in its followup
reviews. (Ss)](ViewImageLocal?handle=hein.gao/gaobacxpr0001&div=1&collection=&method=preview&ext=.png&size=3)