Review of Pension Costs Claimed for Medicare Reimbursement by Blue Cross and Blue Shield of Oregon

This final report provides the results of our review of Pension Costs Claimed for Medicare Reimbursement by Blue Cross and Blue Shield of Oregon (Oregon). For 1993 and 1994, Oregon underclaimed allowable Medicare pension costs. During this period, the allowable Medicare pension costs were $243,881. However, Oregon claimed pension costs of $198,217 for Medicare reimbursement. As a result, Oregon did not claim $45,664 of allowable pension costs. The underclaim occurred primarily because Oregon based its pension cost calculations on incorrect pension asset values for the Medicare segment. We recommended Oregon revise its Final Administrative Cost Proposals to reflect the remaining allowable pension costs. Oregon agreed with our recommendations.