Medicare:

Millions in Potential Recoveries Not Being Sought by Maryland Contractor

HRD-91-32: Published: Jan 25, 1991. Publicly Released: Jan 25, 1991.

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GAO evaluated the adequacy of the Health Care Financing Administration's (HCFA) Medicare contractor budget for claims processing and program safeguard activities, focusing on the Maryland Medicare claims processing contractor's: (1) payment of claims for which other health insurers may have had primary payment responsibility under the Medicare secondary payer (MSP) program; and (2) efforts and resources for pursuing MSP recoveries.

GAO found that: (1) the Maryland Medicare contractor paid at least $8.8 million in Medicare claims that primary insurers should have paid under MSP provisions; (2) 13 insurers were each potentially responsible for more than $100,000 of the health care payments, and the Maryland Medicare contractor, as a private primary health insurer, was potentially responsible for $4.1 million of the payments; (3) the contractor did not pursue the large inventory of potential recoveries due to reductions in funds for MSP activities, and had only 1.5 full-time-equivalent staff assigned to recover mistaken MSP payments; and (4) the contractor estimated that, with an additional $200,000 for needed staff, it could eliminate the total MSP backlog in 1 year.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: The Medicare contractor has recouped $6.2 million in overpayments.

    Recommendation: The Administrator, HCFA, should work with the Medicare contractor to: (1) determine the full scope of the problem and the resources needed to correct it; and (2) establish a plan, including milestones, for seeking recoveries.

    Agency Affected: Department of Health and Human Services: Health Care Financing Administration

  2. Status: Closed - Implemented

    Comments: The HCFA Philadelphia Regional Office received a final report from the contractor on March 3, 1993, that accounted for all of the amounts identified by GAO.

    Recommendation: The Administrator, HCFA, should closely monitor the Medicare contractor's performance in meeting the milestones set for the recovery activity.

    Agency Affected: Department of Health and Human Services: Health Care Financing Administration

 

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