Auditors criticize state Family Health Administration

State auditors have questioned $88,000 in claims paid to health care providers by the Family Health Administration in the last two fiscal years.

The auditors said in a report made public Tuesday that the FHA, which provides health care services to at-risk communities, did not adequately make sure claims were legitimate.

For instance, from January 2008 to July 2009 the agency paid for several medical procedures that were considered questionable because records show accompanying care, such as anesthesia, was not provided.

Auditors found 322 questionable claims to 106 providers, but delved into only one. That claim, worth $1,700, was found to be appropriate.

Auditors recommended the FHA develop a more stringent policy for checking questionable claims.

The FHA, a division of the state Department of Health and Mental Hygiene, was also criticized for its role in disbursing money from Maryland's cigarette restitution fund. The fund was created in 1998 after tobacco companies settled a lawsuit with several states.

The FHA doles out the money to county health departments, which use it to treat people with tobacco-related diseases. It gave out about $7 million in fiscal year 2010.

The audit found that the health departments used different criteria to determine whether families were eligible for treatment. Some counties used gross income to determine eligibility, while others used net income, according to the audit.

In response to auditors' request that the FHA come up with uniform criteria, Health Secretary Joshua M. Sharfstein said the FHA had created state income requirement guidelines for cancer treatment that went into effect in June.

The audit also found that changes were made to electronic claims without the authorization of a supervisor.

Sharfstein, in a letter to state auditors, said the FHA had added a column to electronic claims where supervisors must sign to indicate they have approved any changes.

The FHA also has agreed to better investigate and track questionable claims, but Sharfstein — speaking on behalf of the agency — said questionable claims don't always mean overpayment for services.


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