CMS contracts WPS to process Medicare Part B claims. Under the contract, WPS submits a final administrative cost proposal to Medicare to report annual incurred costs. CMS then negotiates a final settlement of allowable costs based on the proposal.
An audit of WPS’ fiscal year 2012 final administrative cost proposal revealed $1.3 million of the insurer’s $38 million in claimed costs were unallowable.
OIG recommended WPS subtract $1.34 million from its final administrative cost proposal to eliminate the unallowable costs and improve processes used to identify allowable and unallowable costs.
While WPS concurred with OIG’s findings on $8,284 in unallowable claims, it did not concur with $1.33 million of the agency’s findings. OIG maintained its findings and recommendations are valid.
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