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URGENT: Video shows beheading of second American journalist

DUBAI (Reuters) - The Islamic State militant group released a video purporting to show the beheading of U.S. hostage Steven Sotloff, the SITE monitoring service reported on Tuesday. A masked figure in the video also issued a threat against a British hostage, a man the group named as David Haines, and warned governments to back off "this evil alliance of America against the Islamic State", the monitoring service said. (Reporting by William Maclean, Editing by Angus MacSwan)

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Audit: Wisconsin must repay $23M for Medicaid charges


MADISON, WI (WTAQ) - A new audit says Wisconsin should be forced to pay back almost $23 million to the federal government, for Medicaid charges that were not fully justified. 

The State Journal of Madison said the U.S. Department of Health and Human Services questioned mental health care services for young people at 27 Wisconsin residential care centers. The care was delivered from 2004 through '06, when Jim Doyle was the governor.  

Auditors said the state drastically raised its charge off rates in '05, when a consultant called for a change in the state's reimbursement formula. Officials were told about the problem a few months ago. 

Current state Health Services Secretary Kitty Rhoades sent Washington a rebuttal in May, saying that federal auditors misinterpreted their own rules. She said the federal government falsely assumed that treatment was provided each day, and was not limited to counseling sessions. 

The auditors said the state's cost figures were not supported by adequate records on how much time the young people actually spent being treated. The audit also said the state improperly tried getting Medicaid dollars to cover the centers' operating costs. 

Rhoades said it was justified to charge back staff salaries, since they worked around the clock with young people with severe emotional problems.