U.S. flag

An official website of the United States government

Dot gov

The .gov means it's official.
Federal government websites often end in .gov or .mil. Before sharing sensitive information, make sure you're on a federal government site.

Https

The site is secure.
The https:// ensures that you are connecting to the official website and that any information you provide is encrypted and transmitted securely.

Skip to Content

Department of Health and Human Services

Office of Inspector General -- AUDIT

"Audit of Administrative Costs - Medicare Parts A and B--Blue Cross and Blue Shield of Michigan," (A-05-94-00064)

June 27, 1996


Complete Text of Report is available in PDF format (604 kb). Copies can also be obtained by contacting the Office of Public Affairs at 202-619-1343.

EXECUTIVE SUMMARY:

This final audit report points out unallowable costs of $15.6 million claimed by Blue Cross and Blue Shield of Michigan (BCBSM) for Fiscal Years 1990 through 1993. The unallowable costs consisted of, and we recommended financial adjustments for: $8.1 million in costs in excess of the Health Care Financing Administration's (HCFA) notice of budget authorization; $2.4 million for unallowable strategic planning costs that did not directly benefit the Medicare program; $2.1 million in credits due the Medicare program from BCBSM's Medicare secondary payer activities; $1.3 million for unallowable investments; $1.2 million for implementation and maintenance of a claims processing system contrary to a memorandum of understanding with HCFA; and $0.6 million for various items which were unreasonable, not in accordance with Federal regulation, or did not benefit the Medicare program.