Audit: Mo. overbilled Medicaid by $20.5M

ST. LOUIS -- A federal audit has found the state of Missouri overbilled Medicaid by about $20.5 million.

At issue is billing for administrative costs in schools associated with services for low-income students or those with disabilities.

The audit, released this past week, recommends Missouri refund the money.

The St. Louis Post-Dispatch reported it's now up to the federal Centers for Medicare & Medicaid Services to decide whether the money must be repaid. Ultimately, the issue could be appealed to a federal judge.

Arleasha Mays, a spokeswoman for the Missouri Department of Social Services, defended the state's billing methods, saying officials followed federal instructions and "had approval to operate in the manner we did."

Auditors reviewed Medicaid payments for administrative costs in the St. Louis and Springfield school districts for 2004-2006. Of the $15.3 million that Missouri claimed in Medicaid administrative costs for those two districts during that time, $4.2 million was not eligible for federal reimbursement, the audit determined.

Based on the errors found in those districts, the auditor determined other Missouri school districts received $16.3 million in Medicaid payments for the same fiscal years that was not allowed.

Many of the errors the auditors discovered involved Virginia-based Maximus Inc., a private company hired by the state. It determined the statewide percentages of time spent on Medicaid administrative activities by school districts and how much was eligible for federal reimbursements.

The audit discovered problems with how Maximus handled forms that were not returned. By excluding those forms, the audit alleges, the company inflated the administrative costs related to the Medicaid program.

A spokeswoman for Maximus, which no longer has a contract with the Missouri Department of Social Services, did not return a phone message Friday from The St. Louis Post-Dispatch.