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EXECUTIVE SUMMARY:
The objectives of this audit were to: (1) determine the amount and collectibility of non-tax delinquent debt owed to Medicare that existed at September 30, 2000; and (2) assess the Centers for Medicare & Medicaid Services (CMS) Region IV Regional Office’s (RO) management activities to ensure that pro-active measures are taken to collect the delinquent debt before it is referred to the Treasury for collection. The accounts receivable balances CMS RO reported on the R751 for financial statement purposes for the period ending September 30, 2000 for Part A (non-MSP (Medicare Secondary Payor), MSP and Currently Not Collectible (CNC)) accounts receivable was $25,120,726 in principal and $19,531,898 in interest and the balance for Part B (non-MSP, MSP and CNC) was $161,654,066 in principal and $89,712,836 in interest. Our reconciliation of these balances to the subsidiary records showed the Part A non-MSP was understated by $102,927,298 and the Part B non-MSP was overstated by $2,608,769. We also determined that the Part A MSP balance was overstated by $3,516. Other audit tests we performed on statistical samples of Part A non-MSP and Part B non-MSP balances showed the vast majority of receivables were recorded, supported, complete, properly valued and existed at September 30, 2000. We recommended that the RO: (1) promptly reconcile their support before reporting the amounts on the R751, RC751 and the RM751; (2) increase the Part A balances totaling $102,923,782 and reduce the Part B balances totaling $3,653,761; (2) correct status codes on three Part B balances to show the accurate location of the balances; (3) establish a system of internal control that will provide adequate and timely tracking of its collection activities; and (4) transfer two Part A MSP balances totaling $4,114 back to the contractor.