Review of Clinical Laboratory Services Provided Under the Kansas Medicaid Program

This final report provides the results of our review of Clinical Laboratory services Provided Under the Kansas Medicaid Program. Medicaid providers received excess reimbursement estimated at $344,254 (Federal share $202,766) during calendar years 1993 and 1994 for clinical laboratory services that were unbundled (not grouped for payment) or duplicated. The State did not have adequate procedures to prevent paying for unbundled or duplicate laboratory services. We recommended the State (1) install edits to prevent payments for unbundled or duplicate services; (2) instruct providers on bundling requirements; (3) identify and recover 1993 and 1994 overpayments from providers; and (4) return the Federal share of recovered overpayments to the Health Care Financing Administration (HCFA). We estimate that the state could save $172, 127 (Federal share $101,383) annually or about $860,635 over a 5-year period by implementing bundling and duplicate edit procedures.