Complete Text of Report is available in PDF format (3.1 MB). Copies can also be obtained by contacting the Office of Public Affairs at 202-619-1343.
EXECUTIVE SUMMARY:
This report presents the results of the certified public accounting firm of Doshi & Associates' audit of costs claimed on Arkansas Blue Cross Blue Shield's (ABCBS) final administrative cost proposals (FACP). The audit covered Medicare Parts A and B of the Arkansas program and Part B of the Louisiana program for fiscal years 1989 through 1994. We have performed sufficient work to satisfy ourselves that the attached audit report can be relied upon and used by the Health Care Financing Administration in meeting its program oversight responsibilities.
We are recommending a financial adjustment of $1,442,193 because ABCBS:
In order to avoid exceeding approved budgets, ABCBS did not claim $5,121,476 in incurred Medicare costs for fiscal years 1993 and 1994. We offset a portion of the unclaimed costs against questioned costs. We made the offset because ABCBS had originally claimed the detailed costs on its FACP'S, and then eliminated them because they exceeded budget ceilings. As a result, the unclaimed costs were identifiable and auditable. We did not, however, offset the remainder of unclaimed costs against questioned costs because they were not specifically identified.
In its response, ABCBS agreed with $1,213,797 of the questioned costs, and disagreed with the findings on employee health insurance and executive compensation costs.