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A Review of The Medicaid Claims Risk Stabilization Reserve Fund the National Heritage Insurance Company Held Pursuant to Its Contract with the Health and Human Services Commission

November 2004

Report Number 05-013

Overall Conclusion

We verified that the National Heritage Insurance Company (NHIC) has refunded to the State $8.96 million, all of the funds that remained in NHIC's Medicaid Claims Risk Stabilization Reserve Fund (Reserve Fund). This includes $7,690,851.08 in the Reserve Fund bank statement balance as of January 31, 2004, as well as an additional $26,780.23 for interest earned and $1,243,052.80 for voided checks.

NHIC had established the Reserve Fund pursuant to its contract with the Health and Human Services Commission through which it served as the State's Medicaid claims administrator. NHIC ceased serving as the State's Medicaid claims administrator effective January 1, 2004; however, until June 30, 2004, it was still responsible for paying outstanding claims for calendar year 2003 from the balance that remained in the Reserve Fund.

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