LITTLE ROCK — An audit of state programs that receive federal funding found documentation inadequate to support about $1.3 million in Medicaid billings.

State Department of Human Services officials told the Legislative Joint Auditing Committe Friday that they reviewed the audit findings and that all the services were provided. The problem, they said, is the volume of documentation requirements on both the state and federal level.

The findings were part of a review of the $8.6 billion in federal funds the state received during the 2011-2012 fiscal year. The issues in documentation for $1.3 million in payments were found among $231 million made to home and community based providers for the elderly and disabled.

State Medicaid Director Andy Allison said providers across the state do the work of providing the the care under the program and they are required to document everything.

"We have tens of thousands of providers that serve the program," he said. "We have millions and millions of claims that come in and each one of those claims for reimbursement could include data which draws from thousands of procedure and service codes."

Tommy Carlisle, chief financial officer of DHS’ Arkansas Division of Medical Services, said the department was not disputing the audit’s findings that documentation might have been inadequate.

"We are disputing that a lack of documentation, for instance not signing the title to one document out of hundreds or thousands, would be a reason to question that that service was legitimately provided to a beneficiary, Carlisle said.

In response to a question, Allison said he believes the documentation requirements "are heavy," and they are being required, typically, by small businesses across the state that provide the services.

"We have a very high volume service being provided by relatively low wage providers in many cases, not in all cases, of course," he said.

Carlisle said the department has taken several steps to try and address the documentation issues found in the audit, including providing additional training to personal care providers at the corporate level, as well as at the direct care level, to make sure billing is adequately supported by documentation required by the Medicaid Provider Manual.

During the meeting, Allison addressed the legislation that created a Medicaid Inspector General office to investigate reports of waste, fraud and abuse.

"It’s certainly our goal … to support the office of inspector general legislation," he said. "It’s out intent … that we have an extremely positive relationship with the new inspector general and that the renewed focus, or our new intense focus and charges of the inspector general lead to an improved program (that addresses) waste, fraud and abuse."