Review of Bad Debts Reported by Fresenius Medical Care's Facilities Under Medicare's End Stage Renal Disease Program for Calendar Year 1996

EXECUTIVE SUMMARY:

This final audit report points out that Fresenius Medical Care (FMC) allocated approximately $16.1 in unallowable costs to 320 facilities claiming reimbursable bad debts in Calendar Year 1996. As a result, reimbursable bad debts claimed by these facilities were overstated by $1.5 million. In addition to a financial adjustment for the $1.5 million, we recommended that FMC establish additional procedures to exclude the unallowable costs identified by our review from future cost reports. The FMC generally concurred with our findings and recommendations.

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