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10501
OCCUHEIT RESUBE
03501 - [A2553689] (Sestricted)
[cost Related Bedicaid Reimbursements to Nursing Homes in the
State of Kansas lCode 106121)]. September 8, 1977. 5 pp.
Report to Gene Hyde, Acting Regional Administrator, Wealth Care
Financing Administration; by Devid A. Hanas, Regional manager,
Field operations Div.: Regional Office (Kansas City).
Issue Area: Health Programs: Health Providers (1202); Health
Programs: Reiabursesent Pclicies and Utilization Controls
(1208).
Contact: Field Cperaticns Div.: Regional office (Kansas City).
Budget Function: Health: Nursing Boses (557); miscellaneous:
Financial management and Information Systems (1002).
A survey was conducted of State of Kansas controls and
procedures used to reimburse nursing homes for services provided
patients under the sedicaid program. The investigator3 analyzed:
the State's method 3f establishing reimbursement rates, selected
program providers' ccst reports which the State used tc
establish these rates, and four program providers' records to
verify the propriety of selected costs included in the reports.
Findings/Conclusions: The state was not effectively identifying
and following up cn questionable or anallowable provider costs.
As a result, some proiders were reimbursed at rates higher than
justified on the basis of their allowable incurred costs, and
the State's reimbursement ceilings were raised because these
unallowatle costs were included in the cost base the State used
to set rate ceilings. Moreover, the State had erroneously raised
the reimbursement ceilings even further by including in the cost
base estimated operating costs for new facilities and facilities
under new cnership. In fiscal years 1975 and 1976, about
$700,000 shcdld have been disallowed either during desk audits
or fcllceup field audits, and other costs were identified which
appeared improper but passed through desk audit unchallenged. A
recaputation of fiscal year 1977 reimbursement ceilings asing
the State's reimbursement formula and fiscal year !976 reported
costs tut excluding the proposed budgets showed possible
excessive paysents of $800,000 to intermediate care facilities.
Recommendations: The Acting Regional Administrator should
monitor the State's progress in correcting the deficiencies
cited and recover the Federal portion of the overpayments found
by the State in its followup reviews. (Author/SE)
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