Duplicate Medicare Payments to Cost-Based Health Maintenance Organization Plans for John Deere Health Plan, Inc., for the Fiscal Years 2000 Through 2003

EXECUTIVE SUMMARY:

The object of the audit was to determine whether services performed by the John Deere Health Plans, Inc.'s capitated provider were also being reimbursed under the Medicare fee-for-service payment system. We determined that Deere's capitated provider filed Medicare claims, for which they were paid on a fee-for-service basis, while under a capitation arrangement with Deere.  The capitation arrangement, which provides for a per member, per month payment to Deere's capitated provider, covered allowable service performed by the provider to Deere's enrollees. Medicare reimbursed Deere for the capitation payments made to the provider via the Medicare cost report, therefore, the fee-for-service claims paid directly to the provider by Medicare are considered overpayments.  During our audit period, inappropriate Medicare fee-for-service billing by Deere's capitated provider amounted to $78,799.

We recommended that Deere recover the $78,799 in duplicate Medicare fee-for-service claims made to the capitated provider and that Deere develop an efficient and effective system to preclude and detect duplicate payments from the capitated provider.  John Deere Health Plan, Inc. agreed with our recommendations.