In a time of tight budgets, a Missouri state agency might have to reimburse the federal government up to $1.7 million in Medicaid payments to hospitals that the agency potentially shouldn’t have allowed.

The U.S. Department of Heath and Human Services’ Office of Inspector General released a report Friday detailing $2.7 million in claims for inpatient hospital care that were questionable because they were for treating “reasonably preventable conditions caused by medical accidents or errors in a health care setting.”

The report found that the Missouri Department of Social Services didn’t follow federal rules that require it to review claims for treating those types of conditions. It also said the state paid out those claims even though, in some instances, hospitals left key fields blank.

Medicaid, which is called MO HealthNet in Missouri, is paid for with a mix of state and federal dollars. The federal share of the $2.7 million was about $1.7 million. The Office of Inspector General recommended that Missouri officials work with the federal government to review how many of the questionable claims were legitimate and determine how much the state must pay back.

Jennifer Tidball, the director of MO Health Net, didn’t immediately respond to a phone message Friday.

The federal report says her agency agreed with the findings and had implemented procedures to review all inpatient hospital claims that deal with preventable medical accidents and errors. It also said a state contractor had identified claims from the federal audit that shouldn’t have been paid out, but they amounted to only $220,000.

The Office of Inspector General commended Missouri on its quick action, but officials from the agency said they wanted to “note that we did not review the implemented procedures that Missouri outlined to determine their effectiveness.”

Donald White, a spokesman for the Office of Inspector General, said the matter may not be over.

“I know of no plans for a re-review,” White said. “It is possible. That kind of notation in a report is not usual.”

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Medicaid payment errors could cost Missouri up to $1.7 million