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Operations of Group Health Incorporated (GHI) in carrying out its responsibilities under Part B of the Medicare program in Queens County, New York, were reviewed. GHI has operated as the Medicare Part B carrier for Queens County since the beginning of the program. The initial contract commenced on February 11, 1966, and has been renewed annually. A detailed explanation of the events and circumstances leading to the initial contract award was not available. However, contracts are renewed yearly unless the carrier or the Government decides not to renew. From January 1, 1973, through June 30, 1976, there were only three instances where the Medicare Bureau reported a GHI operation as unsatisfactory. Claims processing and beneficiary services and provider relations received unsatisfactory ratings for the period ended June 30, 1976; these ratings were attributable to a strike at the carrier which lasted from January 1 to April 23, 1976, and which crippled both the Medicare and private business operation. The accessibility of GHI to beneficiaries in Queens does not appear to be any better or worse than that for other Medicare beneficiaries in the New York area. For the period July through September 1976, GHI had the second highest rate of processing errors per claim line item of all carriers in the region and one of the highest in the country. Because physicians in Queens County charge less, Medicare reimbursement rates there are generally lower than in other areas of New York City.

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