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GAO_11-793R: 

United States Government Accountability Office: 
Washington, DC 20548: 

July 15, 2011: 

The Honorable Tom Harkin:
Chairman:
The Honorable Michael B. Enzi:
Ranking Member:
Committee on Health, Education, Labor, and Pensions: 
United States Senate: 

The Honorable Fred Upton:
Chairman:
The Honorable Henry A. Waxman:
Ranking Member:
Committee on Energy and Commerce: 
House of Representatives: 

Subject: World Trade Center Health Program: Administrator's Plans for 
Evaluating Clinics' Capabilities to Provide Required Data: 

This report formally transmits the enclosed briefing slides that we 
presented to staff from your offices on June 30, 2011,[Footnote 1] in 
response to the James Zadroga 9/11 Health and Compensation Act of 2010 
(Zadroga Act). The Zadroga Act requires GAO to report by July 1, 2011, 
on whether the Clinical Centers of Excellence (CCE) under contract 
with the World Trade Center Health Program (WTCHP) Administrator have 
financial systems that allow for the timely submission of health care 
claims data as envisioned by the act.[Footnote 2],[Footnote 3] 
Beginning on July 1, 2011, the WTCHP is to provide medical services to 
responders and survivors of the September 11, 2001, terrorist attacks 
through contracted medical facilities known as CCEs in the New York 
City/New Jersey metropolitan area and a nationwide network of 
providers. In addition to providing medical services, the WTCHP is 
required to collect, report, and analyze data, including health care 
claims data; perform research on World Trade Center-related health 
conditions; and establish an outreach program. The Secretary of Health 
and Human Services designated the Director of the National Institute 
for Occupational Safety and Health (NIOSH) as the WTCHP Administrator. 
The Administrator is responsible, as specified by the Zadroga Act, for 
all provisions of the act not related to payments for eligible health 
care claims. 

As discussed with the committees, our objective was to describe the 
WTCHP Administrator's plans and processes for determining whether the 
CCEs' financial systems can provide timely and accurate health care 
claims data as required by the Zadroga Act. Accordingly, the briefing 
focused on the: 

(1) Centers for Disease Control and Prevention (CDC)/NIOSH schedule 
for awarding contracts to CCEs,[Footnote 4] 

(2) health care claims data requirements for the CCEs and planned 
procedures, and: 

(3) Administrator's plans for evaluating each CCE system's health care 
claims data capabilities during and after the award of the contracts. 

To achieve our objective, we focused on the health care claims data 
requirements and related controls to be included in the CCE contracts. 
We reviewed the WTCHP Administrator's contracting activities and 
related documentation, including acquisition planning and solicitation 
documents; claims data requirements; and the Administrator's approach 
for evaluating CCEs' financial systems claims data collection, 
processing, and reporting capabilities. We also interviewed officials 
with the Department of Health and Human Services (HHS), CDC, and 
NIOSH. We provided a copy of the draft slides to CDC/NIOSH for comment 
prior to our June 30, 2011, briefing. The WTCHP Project Officer did 
not have any comments on the information in the enclosed briefing 
prior to our presentation to the committees' staff. We also provided a 
copy of this draft report to HHS for comment on July 12, 2011, and 
incorporated a technical comment we received on the briefing slides. 

We conducted our work from February 2011 to July 2011 in accordance 
with all sections of GAO's Quality Assurance Framework that are 
relevant to our objectives. The framework requires that we plan and 
perform the engagement to obtain sufficient and appropriate evidence 
to meet our stated objectives and to discuss any limitations in our 
work. We believe that the information and data obtained, and the 
analysis conducted, provide a reasonable basis for any findings and 
conclusions. 

Results in Brief: 

At the time of our review, CDC/NIOSH officials were pursuing a CCE 
contract awards schedule that was driven by the Zadroga Act's program 
implementation date of July 1, 2011. CDC/NIOSH officials anticipated 
awarding multiple cost-plus, fixed-fee: 

contracts for the CCEs on June 30, 2011--the day before WTCHP 
implementation.[Footnote 5] The CCE request for proposals issued by 
NIOSH included requirements that were based on the health claims data 
requirements included in the Zadroga Act. According to NIOSH 
officials, as of June 21, 2011, all acquisition milestone dates had 
been met. Subsequent to our briefing, CDC awarded seven CCE contracts 
on July 1, 2011. If CDC/NIOSH had not met the planned CCE contract 
award date, CDC/NIOSH officials' contingency plan was to extend the 
cooperative agreements with the clinical centers under the current 
World Trade Center health programs administered by NIOSH to provide 
medical services to responders and survivors. 

The WTCHP Administrator plans to develop programwide procedures to be 
used by the CCEs for collecting and reporting of health care claims 
data after the program is implemented and CCEs begin submitting health 
care claims for payment. According to the request for proposals, the 
CCEs will be expected to use the Centers for Medicare and Medicaid 
Services (CMS) 1500 form or a similar form to collect the needed 
health claims data.[Footnote 6] CCEs will be expected to 
electronically submit, within specified time frames, all valid health 
care claims for payment. The request for proposals also required that 
each CCE implement a quality assurance program that includes a review 
of all health claims forms for completeness and accuracy before the 
claims are submitted. 

The Administrator planned to evaluate potential CCEs' capabilities for 
collecting and reporting health care claims data as part of the 
contract awards process. According to the request for proposals, 
members of a technical panel were to evaluate offerors' approach for 
accomplishing the contract requirements, including the collecting and 
reporting of health care claims data. The panel members also were to 
review offerors' narrative descriptions of their accounting systems' 
capabilities to assess whether each system is adequate for determining 
costs applicable to the CCE contract as required by the Federal 
Acquisition Regulation.[Footnote 7] NIOSH officials stated that the 
compressed CCE contract awards schedule could not accommodate site 
visits by its personnel or personnel from an outside entity, such as 
the Defense Contract Audit Agency (DCAA), to assess the offerors' 
financial systems' health care claims data capabilities. The officials 
also stated that they may consider having DCAA assess the CCEs' 
financial systems after the contracts are awarded. Further, the WTCHP 
Administrator plans to establish procedures to randomly monitor and/or 
periodically inspect a CCE's compliance with the timely submission of 
health care claims data as part of assessing a CCE's contract 
performance. 

Agency Comments: 

We requested comments on a draft of this report from the Secretary of 
Health and Human Services or her designee. HHS did not have any 
comments on the transmittal letter; however, a technical comment 
related to the briefing slides was provided, which we incorporated as 
appropriate. 

We are sending copies of this report to interested congressional 
committees, the Secretary of Health and Human Services, the Director 
of the Centers for Disease Control and Prevention, the Director of the 
National Institute for Occupational Safety and Health, and other 
interested parties. The report also is available at no charge on the 
GAO Web site at [hyperlink, http://www.gao.gov]. 

Should you or your staff have any questions about this report, please 
contact me at (202) 512-9312 or dalykl@gao.gov. Contact points for our 
Offices of Congressional Relations and Public Affairs may be found on 
the last page of this report. GAO staff who made major contributions 
to this report are listed in enclosure II. 

Signed by: 

Kay L. Daly:
Director:
Financial Management and Assurance: 

Enclosures - 2: 

[End of section] 

Enclosure I: Briefing Slides: 

World Trade Center Health Program: Administrator's Plans for 
Evaluating Clinics' Capabilities to Provide Required Data: 

Briefing to the Staffs of the: 

Committee on Health, Education, Labor, and Pensions, United States 
Senate: 

Committee on Energy and Commerce, House of Representatives: 

Overview:
* Introduction:
* Objective, Scope, and Methodology:
* Background:
* CDC/NIOSH Schedule for Awarding CCE Contracts:
* Health Care Claims Data Requirements and Planned Procedures:
* Administrator's Plans for Evaluating CCEs' System Capabilities: 
* Agency Comments: 

Introduction: 

The James Zadroga 9/11 Health and Compensation Act of 2010, Pub. L. 
No. 111-347,[Footnote 8] (Zadroga Act), was enacted to establish the 
World Trade Center Health Program (WTCHP). The Zadroga Act provides 
$1.56 billion for the program, beginning on July 1, 2011, through 
fiscal year 2016.[Footnote 9] The Zadroga Act also calls for the 
following: 

* The federal government will pay the lesser of 90 percent of the 
costs of carrying out the WTCHP or an annual spending limit set by the 
Zadroga Act.[Footnote 10] 

* The WTCHP will provide medical services to responders and survivors 
of the September 11, 2001, terrorist attacks through medical 
facilities known as Clinical Centers of Excellence (CCE) in the New 
York City/New Jersey metropolitan area and a nationwide network of 
providers. [Footnote 11] 

* In addition to providing medical services, the WTCHP is required to 
collect, report, and analyze data, including health care claims data; 
perform research on World Trade Center (WTC)-related health 
conditions; and establish an outreach program. 

The Secretary of Health and Human Services designated: 

* the Director of the National Institute for Occupational Safety and 
Health (NIOSH)[Footnote 12] as the WTCHP Administrator responsible, as 
specified by the Zadroga Act, for all provisions of the act not 
related to payments for eligible health care claims and: 

* the Centers for Medicare and Medicaid Services (CMS) as the payor of 
eligible health care claims associated with the initial health 
evaluation, monitoring, and treatment of enrolled responders and 
survivors.[Footnote 13] 

Objective, Scope, and Methodology: 

As discussed with the committees, our objective was to describe the 
WTCHP Administrator's plans and processes for determining whether the 
CCEs' financial systems can provide timely and accurate health care 
claims data as required by the Zadroga Act.[Footnote 14] Accordingly, 
this briefing focuses on the: 

(1) Centers for Disease Control and Prevention (CDC)/NIOSH schedule 
for awarding contracts to CCEs, 

(2) health care claims data requirements for the CCEs and planned 
procedures, and: 

(3) Administrator's plans for evaluating each CCE system's health care 
claims data capabilities during and after the award of the contracts. 

To achieve our objective, we focused on the health care claims data 
requirements and related controls to be included in the CCE contracts 
which, according to the WTCHP Administrator's acquisition plan, would 
not be awarded until June 30, 2011. We reviewed the WTCHP 
Administrator's contracting activities and related documentation, 
including acquisition planning and solicitation documents; claims data 
requirements; and the Administrator's approach for evaluating CCEs' 
financial systems claims data collection, processing, and reporting 
capabilities. We also interviewed officials with the Department of 
Health and Human Services (HHS), CDC, and NIOSH.[Footnote 15] 

We conducted our work from February 2011 to July 2011 in accordance 
with all sections of GAO's Quality Assurance Framework that are 
relevant to our objectives. The framework requires that we plan and 
perform the engagement to obtain sufficient and appropriate evidence 
to meet our stated objectives and to discuss any limitations in our 
work. We believe that the information and data obtained, and the 
analysis conducted, provide a reasonable basis for any findings and 
conclusions. 

Background: 

Since the September 11, 2001, terrorist attacks, Congress has 
appropriated funding for screening, monitoring, and treatment services 
to persons involved with response, recovery, or cleanup operations at 
the WTC sites as well as residents and others affected by the attacks. 
From fiscal year 2002 through fiscal year 2010, Congress provided 
approximately $475 million for screening, monitoring, and treating 
responders and survivors for illnesses and conditions resulting from 
the attacks. 

The current WTC health programs, consisting of four components, are 
administered by NIOSH and provide medical services to responders and 
survivors.[Footnote 16] 

The current WTC health programs are not explicitly authorized by 
statute, but rather are authorized by the general authority of the 
Secretary of Health and Human Services to encourage, cooperate with, 
and render assistance to entities that study and treat physical and 
mental diseases and impairments of individuals through, among other 
things, grants and general appropriations to NIOSH to provide services 
to eligible individuals.[Footnote 17] 

NIOSH funds the current WTC health programs through: 

* six clinical center cooperative agreements that are scheduled to 
expire on June 30, 2011; 

* a 3-year grant awarded in September 2008 to a municipal health care 
organization for serving 9/11 survivors; and: 

* a 1-year contract with 4 option years awarded in September 2010 to a 
health care provider for the management of a nationwide responder 
health program. 

Figure 1 provides the current WTC health programs' reported enrollment 
and participation information as of December 31, 2010. 

Figure 1: Number of Enrollees and Participants in the Current World 
Trade Center Health Programs as of December 31, 2010: 

[Refer to PDF for image: vertical bar graph] 

New York City Fire Department responders: 
Enrollees[C]: 15,721. 
Participants receiving initial exam: 15,415; 
Monitoring: Participants examined in the past year: 10,945; 
Treatment: Participants served in the past year[D]: 5,686. 

New York/New Jersey WTC Consortium responders[A]: 
Enrollees[C]: 33,311; 
Participants receiving initial exam: 29,572; 
Monitoring: Participants examined in the past year: 12,802; 
Treatment: Participants served in the past year[D]: 8,411. 

National responders (outside New York City area)[B]: 
Enrollees[C]: 4,453; 
Participants receiving initial exam: 3,581; 
Monitoring: Participants examined in the past year: 2,244; 
Treatment: Participants served in the past year[D]: 908. 

Survivor program participants: 
Enrollees[C]: 5,130; 
Participants receiving initial exam: 5,130; 
Monitoring: Participants examined in the past year: 1,745; 
Treatment: Participants served in the past year[D]: 2,520. 

Totals: 
Enrollees[C]: 58,615; 
Participants receiving initial exam: 53,698; 
Monitoring: Participants examined in the past year: 27,736; 
Treatment: Participants served in the past year[D]: 17,525. 

Source: CDC?NIOSH. 

[A] New York/New Jersey WTC Consortium responders are those served by 
the following five clinical centers: Bellevue Hospital/New York 
University School of Medicine, City University of New York/Queens 
College, Mount Sinai School of Medicine, State University of New York 
at Stony Brook, and the University of Medicine and Dentistry of New 
Jersey/Robert Wood Johnson Medical School. 

[B] The national responders are served by the National Responder 
Health Program, which consists of a nationwide network of providers. 

[C] "Enrollees" refers to individuals meeting program eligibility 
criteria, but not all individuals have decided to participate after 
enrolling. 

[D] Participants in treatment are those who were referred from a 
monitoring exam for follow-up care and have received any treatment in 
the past year. 

[End of figure] 

As we previously reported, according to a NIOSH official, the data 
collection efforts on the current WTC health programs do not provide 
sufficient detailed information to help the agency identify ways to 
improve the programs' effectiveness and oversight as well as the 
reliability of the programs' estimated future costs.[Footnote 18] 
NIOSH has taken action to gather more detailed information about 
responders' and survivors' health conditions. For example: 

In early 2007, NIOSH began requiring the clinical centers to submit 
quarterly reports containing detailed demographic, service 
utilization, and cost information. 

In July 2009, NIOSH began requiring the clinical centers to provide 
more detailed diagnostic information. For example, the clinical 
centers were required to report the number of responders and survivors 
with certain lower airway conditions, such as asthma and chronic 
obstructive pulmonary disease. 

However, these data do not provide detailed health care information. 
Specifically, NIOSH does not have access to the types of information 
associated with a specific patient encounter, such as details about 
the responder's health, specific services the responder received, and 
the cost of providing services to a responder during that encounter. 
[Footnote 19] 

Congress passed the Zadroga Act to establish, among other things, the 
WTCHP, which replaces the current WTC health programs on July 1, 2011. 
According to a House of Representatives report dated July 22, 2010, 
part of Congress's intent included establishing agency accountability 
for administering the program.[Footnote 20] Among other things, the 
Zadroga Act requires: 

* the WTCHP Administrator to establish and maintain a system for the 
uniform collection of health care claims data;[Footnote 21] 

* the WTCHP Administrator to work with the CCEs on developing and 
implementing a quality assurance program for the medical services 
provided under the program; and: 

* the HHS Inspector General to oversee the WTCHP to prevent and detect 
fraudulent and duplicate billing, inappropriate payments, and 
unreasonable administrative costs. 

CDC/NIOSH Schedule for Awarding CCE Contracts: 

CDC/NIOSH officials are pursuing a CCE contract awards schedule that 
is driven by the Zadroga Act's program implementation date of July 1, 
2011. 

* According to the acquisition plan for the CCE contract awards, the 
WTCHP Administrator determined that the Zadroga Act directs HHS to 
have contracts in place by July 1, 2011, which necessitates a 
compressed schedule. 

* If CDC/NIOSH does not meet the planned CCE contract award date of 
June 30, 2011, CDC/NIOSH officials' contingency plan is to extend the 
cooperative agreements with the clinical centers under the current WTC 
health programs. 

CDC/NIOSH officials anticipate replacing the current WTC health 
programs' six cooperative agreements and 3-year grant by awarding 
multiple cost-plus, fixed-fee contracts on June 30, 2011--the day 
before the WTCHP's implementation.[Footnote 22] 

According to NIOSH officials, the cost-plus, fixed-fee contract type 
was selected instead of a fixed-price contract due to an inability to 
accurately predict program costs because of the increasing health care 
needs of the covered population. 

The schedule for awarding the CCE contracts, including key acquisition 
activities and their related milestone dates, is shown in figure 2. 
According to NIOSH officials, all milestones as of June 21, 2011, have 
been met. 

Figure 2: Schedule for Awarding Clinical Centers of Excellence 
Contracts: 

[Refer to PDF for image: timeline] 

April 11, 2011: 
Request for proposals issued. 

May 11, 2011: 
Offerors' proposals due. 

June 2, 2011: 
Technical review of proposals completed 

June 16, 2011: 
Negotiations completed. 

June 30, 2011: 
Contracts awarded. 

Source: CDC/NIOSH. 

[End of figure] 

Health Care Claims Data Requirements and Planned Procedures: 

As shown in table 1, the CCE request for proposals issued by NIOSH 
includes requirements that are based on the health claims data 
requirements included in the Zadroga Act. 

Table 1: Health Care Claims Data Requirements for the Clinical Centers 
of Excellence: 

Zadroga Act requires the WTCHP Administrator to ensure that CCEs: 
Agree to collect and report health care claims data as defined by the 
Administrator on all individuals provided monitoring or treatment 
benefits to their respective data center; 
Health care claims data requirements in the NIOSH request for 
proposals: 
CCEs are to prepare CMS 1500 form or a similar form for each encounter 
with a WTCHP enrollee, ensure that health care claims contain all the 
data required by CMS 1500 form,[A] and electronically submit health 
care claims data to the corresponding data center. 

Zadroga Act requires the WTCHP Administrator to ensure that CCEs: 
Gather information on whether an individual is covered by a workers' 
compensation program, a public or private health plan, or both as part 
of the health care claims data collected; 
Health care claims data requirements in the NIOSH request for 
proposals: 
CCEs are to gather information on enrollees' insurance coverage, such 
as Medicaid, Medicare, commercial, employment-based (e.g., workers' 
compensation), and liability insurances. 

Zadroga Act requires the WTCHP Administrator to ensure that CCEs: 
Receive payment for their medical treatment and services based on 
Federal Employee Compensation Act (FECA) payment rates or the 
reimbursement rate established by the Administrator, if a medical 
treatment is not covered by the FECA rates; 
Health care claims data requirements in the NIOSH request for 
proposals: 
CCEs are to bill for all treatment services on a fee-for-service basis 
based on FECA, payment rates designated by the WTCHP Administrator, or 
both. 

Zadroga Act requires the WTCHP Administrator to ensure that CCEs: 
Protect the confidentially of individually identifiable health 
information consistent with applicable statutes, regulations, the 
Health Insurance Portability and Accountability Act, and security law, 
including requiring that such information not be disclosed to an 
individual's employer without the authorization of the individual; 
Health care claims data requirements in the NIOSH request for 
proposals: 
CCEs are to have in place safeguards, consistent with the Zadroga Act, 
to ensure the confidentiality of individually identifiable health 
information, including requiring that such information not be 
disclosed to an individual's employer without the authorization of the 
individual. 

Source: GAO analysis of the Zadroga Act and the CCE request for 
proposals. 

[A] The CMS 1500 form is the paper claim form accepted nationwide by 
many health plans, including Medicare and Medicaid, for medical claims 
submitted by physicians. Medical providers nationwide currently use 
the CMS 1500 form to record health care claims data, such as a 
patient's identifying information, including name, age, and health 
plan identification number; date the medical service was provided; 
geographic location; diagnosis and medical treatment codes; and 
medical insurance information and cost. 

[End of table] 

The WTCHP Administrator plans to implement the health care data flow 
depicted in figure 3. 

Figure 3: Overview of World Trade Center Health Program's Planned 
Health Care Claims Data Flow: 

[Refer to PDF for image: illustration] 

Clinical Centers of Excellence (CCEs): 
* Data center(s); 
* Consolidator of claims: 
- Claims processing intermediary (CPI); 
- Third part administrator (Claims payor - CMS). 

Source: GAO analysis of CDC?NIOSH acquisition documents. 

Note: Figure 3 does not include the flow of pharmaceutical claims. The 
WTCHP Pharmacy Benefit Manager (PBM) will submit pharmaceutical claims 
for payment to the CPI after the pharmaceutical prescriptions are 
approved by a CCE director and the PBM receives those claims from the 
pharmacy. The CCE director will review pharmaceutical prescriptions to 
ensure that requested pharmaceuticals are consistent with current 
treatment protocols and the program formulary. The pharmacy will be 
reimbursed by the PBM after the PBM receives reimbursement from CMS. 

[End of figure] 

Figure 3 illustrates the key players in the planned process for the 
collection and reporting of required health claims data. Their roles 
and responsibilities include the following: 

* A data center is expected to receive the health care claims data 
from its respective CCEs; perform analyses of the data to identify 
trends, relationships, and patterns related to the WTC-related health 
conditions; and report the results of these analyses to the WTCHP 
Administrator and make the data available to health researchers. 
[Footnote 23] 

* The consolidator of claims, according to NIOSH officials, is 
expected to receive the health care claims data from the WTCHP CCEs, 
verify that a CCE is authorized to exchange data electronically with 
the claims processing intermediary (CPI), and, if needed, reconfigure 
the health care claims data to an agreed-upon format before forwarding 
the data to the CPI for review. 

Once the CPI determines that a CCE has submitted valid, accurate, and 
complete health care claims,[Footnote 24] it is expected to submit, 
within 1 business day, a transaction file of approved claims to CMS, 
the third party administrator, for payment. The CPI is also expected 
to act as the adjudicator of claims.[Footnote 25] 

* The CPI is expected to work with the CCEs to coordinate payment as 
well as to recoup funds for claims previously paid by the WTCHP for 
enrollees who have a WTC-related health condition that is: 

- work-related and the enrollee has filed an applicable workers' 
compensation claim or: 

- not work-related and the enrollee is covered by a public or private 
health insurance plan. 

The CPI is also expected to work with the WTCHP Administrator to 
determine the type, scope, and delivery schedule of financial reports 
needed to manage the program. 

CMS as the third party administrator (claims payor) is expected to 
submit payment schedules to the U.S. Treasury for payment to the CCEs 
within 30 calendar days of the CPI's approval of the health care 
claim. Funds will be drawn from the WTCHP Fund.[Footnote 26] 

The Zadroga Act requires the Administrator to provide for the uniform 
collection and reporting of health care claims data. 

* The WTCHP Administrator plans to develop programwide procedures to 
be used by the CCEs for the uniform collection and reporting of health 
care claims data after the program is implemented and CCEs begin 
submitting health care claims for payment. 

* According to the CCE and data center requests for proposals, after 
the CCE contracts are awarded, the WTCHP Administrator plans to obtain 
input from the CCEs to develop and formalize the specific procedures 
each CCE will use to prepare and submit health care claims data to its 
respective data center and the CPI. 

- The CCEs are expected to meet with data center representatives to 
help define common data collection and transfer protocols, 
standardized forms, and the data entry system for the creation and 
maintenance of health care claims data. 

- Three months after the contracts are awarded, each CCE is expected 
to submit its health care claim data procedures to the WTCHP 
Administrator. 

* The WTCHP Administrator plans to use the CCEs' health care claims 
data procedures to develop programwide procedures that all CCEs will 
be required to follow. NIOSH officials have not indicated when they 
will issue the programwide health care claims data procedures. 
According to the request for proposals, CCEs will be expected to: 

(1) use the CMS 1500 form or a similar form to collect the required 
health care claims data; 

(2) prepare CMS 1500 forms in-house as well as receive CMS 1500 forms 
from their network of medical providers; 

(3) review all CMS 1500 forms containing the health care claims; and: 

(4) electronically submit within specified time frames to the 
consolidator of claims and data centers all valid health care claims. 
[Footnote 27] 

* If a CCE cannot submit the health care claims data electronically, 
it can provide the health care claims data through nonelectronic means 
to the data center and consolidator of claims. The CMS 1500 form's 
design allows the CCEs, data centers, and the CPI to scan the 
information using optical character recognition technology and convert 
the data to an electronic record. 

* The request for proposals also requires that each CCE implement a 
quality assurance program that includes a review of all health claims 
forms for completeness and accuracy before the claims are submitted to 
the data center and CPI. 

Administrator's Plans for Evaluating CCEs' System Capabilities: 

The Administrator plans to evaluate potential CCEs' capabilities for 
collecting and reporting health care claims data as part of the 
contract awards process. 

* Members of a technical panel will evaluate the offerors' proposals 
using the following three factors: Technical/Management; Past/Present 
Performance; and Cost/Price. The Technical/Management factor, 
according to the request for proposals, is the most important factor; 
while Past/Present Performance and Cost/Price factors are of equal 
importance.[Footnote 28] 

* According to the CDC/NIOSH request for proposals, members of a 
technical panel will evaluate offerors' approaches for accomplishing 
the contract requirements, including collecting and reporting of 
health care claims data as part of the Technical/Management factor. 
[Footnote 29] 

Additionally, panel members will, according to the CDC/NIOSH request 
for proposal, review offerors' narrative descriptions of their 
accounting systems' capabilities. The accounting system information 
will be reviewed to determine whether the system is adequate for 
determining costs applicable to the CCE contract, as required by the 
Federal Acquisition Regulation.[Footnote 30] 

* Offerors are required to include, as part of their accounting system 
description, a discussion of the system's ability to support claimed 
costs and any changes contemplated as a result of their proposal. 

* In lieu of the accounting system description, an offeror may submit 
an audit of its accounting system that concluded that the system was 
adequate for determining costs applicable to a cost reimbursable 
contract and was performed by a federal agency such as the Defense 
Contract Audit Agency (DCAA). 

According to the CDC/NIOSH request for proposals, the results of these 
evaluations are key inputs to the CCE contract award process. 

According to the Federal Acquisition Regulation, a cost reimbursement 
contract may be used only when, among other things, a contractor's 
accounting system is adequate for determining costs applicable to the 
contract.[Footnote 31] 

* A federal agency may request that an entity, such as DCAA, perform a 
pre-award survey, which is an examination of an offeror's accounting 
system to determine its acceptability for accumulating costs under a 
prospective government contract. 

The DCAA auditing manual states that emphasis should be placed on the 
ability of the accounting system to generate the specific cost 
information required under the anticipated contract.[Footnote 32] 

However, NIOSH officials stated that the compressed CCE contract 
awards schedule could not accommodate site visits by its personnel or 
an outside entity, such as DCAA, to assess the offerors' financial 
systems' health care claims data capabilities. 

* The officials also stated that they may consider having DCAA assess 
the CCEs' financial systems after the contracts are awarded. 

According to a NIOSH official and the CCE request for proposals, the 
WTCHP Administrator may terminate the agreement with a CCE because of 
a breach of contract if a CCE does not provide the medical services 
contracted for or financial systems do not have, or the CCE cannot 
implement, the systems capabilities needed to meet its contract health 
care claims data requirements. However, the contract termination 
option would be a last resort in the case of financial system issues. 
NIOSH would attempt to remediate any fixable problems prior to 
termination. 

* According to a NIOSH official, responders or survivors served by a 
CCE whose contract is terminated would be reassigned to other CCEs. 
This reassignment of beneficiaries would create additional workload 
for the remaining CCEs. If a CCE can not handle the additional 
workload, the WTCHP Administrator may decide to go through the 
acquisition process to replace the terminated CCE. 

The WTCHP Administrator plans to establish procedures to randomly 
monitor and/or periodically inspect a CCE's compliance with the timely 
submission of health care claims data as part of assessing a CCE's 
contract performance. 

[End of section] 

Enclosure II: GAO Contact and Staff Acknowledgments: 

GAO Contact: 

Kay L. Daly, (202) 512-9312 or dalykl@gao.gov: 

Staff Acknowledgments: 

In addition to the contact named above, Michael LaForge, Assistant 
Director; Jacquelyn Hamilton, Acting Assistant General Counsel; Jehan 
Abdel-Gawad; Lauren Catchpole; Francine DelVecchio; LaTasha Freeman; 
Leticia Pena; and Leonard Zapata made key contributions to this report. 

[End of section] 

Footnotes: 

[1] See enclosure I for our briefing slides. 

[2] The Zadroga Act also requires GAO to study feasibility, 
efficiency, and effectiveness issues related to the WTCHP established 
by the act, including the WTCHP's potential use of one consolidated 
data center rather than multiple data centers, the potential use of 
Department of Veterans Affairs health care facilities to serve World 
Trade Center responders outside the New York City area, and the 
potential use of an existing federal prescription drug purchasing 
program to provide prescription drugs for all World Trade Center 
responders. We plan to issue our report on these three other areas 
later this year. 

[3] According to the WTCHP Administrator's CCE contract awards 
schedule, the Administrator would not have awarded any contracts with 
CCEs until at least June 30, 2011, so a CCE contractor was not in 
place for GAO to assess by July 1, 2011. 

[4] As a component of CDC, NIOSH uses CDC acquisition personnel and 
services. 

[5] According to the Federal Acquisition Regulation, a cost-plus, 
fixed-fee contract is a cost reimbursement contract that provides for 
payment to the contractor of a negotiated fee that is fixed at the 
inception of the contract. This contract type permits contracting for 
efforts that might otherwise present too great a risk to contractors, 
but it provides the contractor only a minimum incentive to control 
costs. Federal Acquisition Regulation, 48 C.F.R. § 16.306. 

[6] The CMS 1500 form is the paper claim form accepted nationwide by 
many health plans, including Medicare and Medicaid, for medical claims 
submitted by physicians. Medical providers nationwide currently use 
the CMS 1500 form to record the following health care claims data: a 
patient's identifying information, including name, age, and health 
plan identification number; date the medical service was provided; 
geographic location; diagnosis and medical treatment codes; and 
medical insurance information and cost. 

[7] See 48 C.F.R. §§ 16.104(h), 16.301-3(a). 

[8] 124 Stat. 3623 (Jan. 2, 2011), classified at 42 U.S.C. §§ 300mm to 
300mm-61. 

[9] The Zadroga Act provides mandatory annual appropriations through 
at least fiscal year 2015 for the WTCHP. The program will continue 
into fiscal year 2016 if unexpended funds from previous fiscal years 
are available. 42 U.S.C. § 300mm-61. 

[10] The annual spending limit set by the Zadroga Act increases each 
fiscal year from $71 million for the last quarter of fiscal year 2011 
to $431 million for fiscal year 2015. 

[11] Generally, the Zadroga Act identifies responders as individuals 
who are members of a fire or police department, federal government 
personnel, and other government and private-sector workers and 
volunteers from New York and elsewhere who participated in rescue, 
recovery, debris cleanup, or related services at or near the vicinity 
of the World Trade Center sites; the Staten Island site; the barge 
loading piers; or the terrorist-related aircraft crash sites at the 
Pentagon and in Shanksville, Pennsylvania. Survivors include residents 
and other building occupants and area workers in New York City who 
were directly affected and adversely affected by the attacks. The act 
does not specifically include Pentagon survivors. However, another 
population that may receive WTCHP services includes persons who are 
not eligible responders or survivors but who are diagnosed with a 
World Trade Center-related health condition by the WTCHP. 42 U.S.C. § 
300mm-21(a), 42 U.S.C. § 300mm-31(a) and 42 U.S.C. § 300mm-33(a). 

[12] NIOSH is a component of the Department of Health and Human 
Services' Centers for Disease Control and Prevention. 

[13] 76 Fed. Reg. 31337 (May 31, 2011). 

[14] The Zadroga Act requires GAO to report by July 1, 2011, on 
whether the CCEs under contract with the WTCHP Administrator have 
financial systems that allow for the timely submission of health care 
claims data as envisioned by the act. According to the WTCHP 
Administrator's CCE contract awards schedule, the Administrator will 
not have awarded any contracts with CCEs until at least June 30. We 
therefore could not perform a review of CCE contractors' financial 
systems because no CCE contractors were in place for us to assess by 
July 1, 2011. 

[15] As a component of CDC, NIOSH uses CDC acquisition personnel and 
services. 

[16] The four components are (1) the New York City Fire Department's 
WTC Medical Monitoring and Treatment Program, (2) the New York/New 
Jersey WTC Consortium, (3) the WTC National Responder Health Program, 
and (4) the WTC Environmental Health Center. 

[17] 42 U.S.C. § 241; 31 U.S.C. §§ 6305-06. 

[18] See GAO, September 11: HHS Needs to Ensure the Availability of 
Health Screening and Monitoring for All Responders, [hyperlink, 
http://www.gao.gov/products/GAO-07-892] (Washington, D.C.: July 23, 
2007), and September 11: World Trade Center Health Programs Business 
Process Center Proposal and Subsequent Data Collection, [hyperlink, 
http://www.gao.gov/products/GAO-11-243R] (Washington, D.C.: Dec. 3, 
2010). 

[19] See [hyperlink, http://www.gao.gov/products/GAO-11-243R]. 

[20] H.R. Rep. No. 111-560 (2010). 

[21] Although the act does not specifically define health care claims 
data, according to CDC/NIOSH, health care claims data consist of a 
patient's name, age, date medical service was provided, health 
condition, and geographic location; the array of services provided 
during the encounter, such as a physical examination or X-ray; and the 
cost of the encounter. 

[22] According to the Federal Acquisition Regulation, a cost-plus, 
fixed-fee contract is a cost reimbursement contract that provides for 
payment to the contractor of a negotiated fee that is fixed at the 
inception of the contract. This contract type permits contracting for 
efforts that might otherwise present too great a risk to contractors, 
but it provides the contractor only a minimum incentive to control 
costs. Federal Acquisition Regulation, 48 C.F.R. § 16.306. 

[23] On April 11, 2011, CDC issued a request for proposals for the 
purpose of awarding a contract to one or more data centers to provide 
data services to the WTCHP in a manner consistent with the 
requirements of the Zadroga Act. The Zadroga Act requires GAO to 
report on the feasibility of consolidating the data centers into a 
single data center. We plan on issuing our report later this year. 

[24] For example, the CPI is expected to review all health care claims 
and ensure that they: are for WTC-related health conditions; are 
correctly coded; are not duplicate claims; and apply the correct fee 
rates. 

[25] On April 18, 2011, CDC awarded a time and materials task order 
consisting of a base year and four options worth up to $79.8 million 
to Computer Sciences Corporation for program management and 
administration. As part of its responsibilities, Computer Sciences 
Corporation will perform the functions of the CPI and be responsible 
for processing and approving CCEs' health care claims. 

[26] The Zadroga Act established the World Trade Center Health Program 
Fund. The WTCHP's benefits cost will be paid from the fund. 42 U.S.C. 
§ 300mm-61. 

[27] After preparing or receiving the CMS 1500 form or a similar form, 
CCEs will be expected to submit to the data centers and consolidator 
of claims all valid health care claims within 1 week of receipt 95 
percent of the time and within 2 weeks 100 percent of the time. 

[28] The factors used and their relative importance to each other are 
consistent with the Federal Acquisition Regulation. 

[29] The technical panel will also evaluate the offerors' capabilities 
to provide, for example, the full range of health monitoring and 
treatment services. 

[30] See 48 C.F.R. §§ 16.104(h), 16.301-3(a). 

[31] See 48 C.F.R. §§ 16.104(h), 16.301-3(a). 

[32] DCAA, Contract Audit Manual, 5-202 b. 

[End of section] 

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