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July 2, 2008
 Review of Medicaid Claims Made By Freestanding Residential Treatment
Facilities in New York State
The report conducted by the Office of the Inspector General (OIG)
investigated Medicaid claims made by the New York Department of Health
for 11 freestanding residential treatment facilities in New York State.
The report noted that $21,531,996 was improperly claimed in Federal Medicaid reimbursement
for services provided to beneficiaries. The amount comes from a total of
30 claims for individuals ages 22 to 64.
Overpayment occurred as a result of the following three reasons:
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Improperly designated claims with detoxification rate code 4220,
submitted by nine IMDs, as eligible for Federal Medicaid reimbursement
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Improperly billed inpatient rehabilitation services using an outpatient
category of service code by NRI Group, LLC
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Improperly claimed Federal Medicaid reimbursement for services furnished
continually by Can Am Youth Services, after the provider increased the
number of beds from 15 to 30
OIG recommended the following to make up for the improperly claimed
funds:
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Refund the $6,582,259 overpayment balance to the Federal Government
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Ensure that the service code rate 4220 is working in the Medicaid
Management Information System
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Designate that NRI Group LLC claims for inpatient rehabilitation
services for individuals 65 and under are recognized as nonparticipating
in its MMIS
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Designate that Can Am Youth Services claims for individuals 65 and under
are recognized as nonparticipating in its MMIS
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Determine the amount of improper claims made after the report was issued
and return the overpayments to the federal government
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