Recommendation: To improve the collection of complete and consistent personal care services data and better ensure CMS can effectively monitor the states' provision of and spending on Medicaid personal care services, CMS should better ensure that personal care services data collected from states through T-MSIS and MBES comply with CMS reporting requirements.

Agency: Department of Health and Human Services: Centers for Medicare and Medicaid Services
Status: Open

Comments: The Centers for Medicare & Medicaid Services (CMS) concurs with GAO's recommendation. In December 2017, CMS cited ongoing efforts related to claims data submitted by states through T-MSIS, CMS's new claims reporting system. Efforts included validation checks of personal care service claims to ensure that key data are not missing or incorrect. In addition, CMS stated it was working with the states to address concerns that are identified with the quality of claims data submitted. However, as of March 2020, CMS had not reported that it had addressed inaccurate state reporting of expenditures through CMS's expenditure reporting system, Medicaid Budget and Expenditure System (MBES). Complete implementation of the recommended action will better ensure state reporting of claims and expenditures is accurate and will allow CMS to effectively perform key management functions.

Recommendation: To improve the collection of complete and consistent personal care services data and better ensure CMS can effectively monitor the states' provision of and spending on Medicaid personal care services, CMS should develop plans for analyzing and using personal care services data for program management and oversight.

Agency: Department of Health and Human Services: Centers for Medicare and Medicaid Services
Status: Open

Comments: The Centers for Medicare & Medicaid Services (CMS) concurred with this recommendation. However, as of March 2020, CMS had not developed a plan for analyzing and using personal care services data as GAO recommended in January 2017. Developing a plan for analyzing and using personal care services data for program management and oversight is an important step CMS needs to take to improve the oversight and management of personal care services.

Recommendation: To provide agencies access to SSA's more complete set of death data, Congress should consider amending the Social Security Act to explicitly allow SSA to share its full death file with Treasury for use through the DNP working system.

Agency: Congress
Status: Open

Comments: In fiscal year 2020, the Senate passed S.4104, which included language to address the recommendation. In the context of the Do Not Pay (DNP) working system, the bill, if enacted, would authorize comparison of the Social Security Administration's (SSA) full death file with personally identifiable information reviewed through the working system and would allow redisclosure of such comparison of information to any federal or state agency authorized to use the working system. As of July 15, 2020, the House has not introduced a related bill for fiscal year 2020. Additionally, in February 2020, the administration released its President's 2021 Budget, which proposes legislation to allow the DNP Business Center full access to the SSA full death file. This proposal would include the Department of the Treasury and the SSA working together to determine the most efficient manner to make full death information available for use in preventing improper payment and fraud. We will continue to monitor congressional legislation to address this recommendation. .

Recommendation: To better monitor agency use of the DNP working system once a strategy has been developed, the Director of OMB should develop and implement monitoring mechanisms--such as goals, benchmarks, and performance measures--to evaluate agency use of the DNP working system.

Agency: Executive Office of the President: Office of Management and Budget
Status: Open
Priority recommendation

Comments: OMB agreed with the concept of monitoring mechanisms and will continue to work with agencies to reduce improper payments and encourage agencies to establish goals to improve payment accuracy that will be monitored and evaluated by OMB. In fiscal year 2019, OMB provided us a status update on July 31, 2019, stating that Treasury does this monitoring and reports updates to OMB on a quarterly basis and that monitoring will occur in conjunction with the President's Management Agenda. In August 2020, Treasury provided us examples of reports that it provides to OMB to assist OMB with evaluating agency use of the DNP working system. We plan to meet with OMB to discuss how it uses these reports and will continue to monitor OMB's actions to address this recommendation.

Recommendation: To reasonably assure that agency-reported information on use of the DNP working system is reliable, the Director of OMB should develop a process for comparing agency reporting on the use of the DNP working system to available sources, such as OMB guidance and DNP working system adjudication reports.

Agency: Executive Office of the President: Office of Management and Budget
Status: Open

Comments: The Office of Management and Budget (OMB) agreed with the concept of ensuring that data are reliable and will consider the feasibility of a process to compare agency submissions to available sources to reasonably assure that agency-reported information on use of the Do Not Pay working system is reliable. OMB provided us a status update on July 1, 2019, stating that OMB will work with Treasury to determine feasibility of doing this review and establishing a process during fiscal year 2019. As of February 2020, OMB has not provided any new status updates for this recommendation. We will continue to monitor the agency's actions to address this recommendation.

Recommendation: To reasonably assure that agency-reported information on use of the DNP working system is complete, the Director of OMB should revise its guidance to clarify whether agencies should report on their uses of all of the functionalities of the DNP working system in their agency financial reports.

Agency: Executive Office of the President: Office of Management and Budget
Status: Open

Comments: The Office of Management and Budget (OMB) agreed with ensuring the completeness of data and will continue to work with agencies and the Chief Financial Officer community to ensure that agency-reported information on the use of the Do Not Pay (DNP) working system is complete. In fiscal year 2019, OMB provided us a status update on July 1, 2019, stating that this recommendation was addressed in OMB's Circular A-136. Additionally, we met with OMB officials on July 31, 2019. During the meeting, OMB officials informed us that the OMB Circular A-136, Section II.4.5 (bullet 3) (dated June 28, 2019) states that "Agencies should provide a brief narrative of the reduction in improper payments that is attributable to the DNP Initiative, as applicable. See OMB Circular A-123, Appendix C, Part V for a thorough overview of the roles and responsibilities of agencies to use centralized data sources such as the Treasury Working System and other government databases to prevent improper payments." We have reviewed OMB Circular A-136 and confirmed that the circular does contain the statements above. However, we do not believe that the OMB Circular A-136 meets the intent of our recommendation. GAO issued its recommendation, in part, because GAO found that OMB guidance does not indicate whether agencies should report on all uses of the DNP working system, including those outside payment integration that the DNP working system does not track. For this reason, GAO report concluded that without complete and reliable data and clear guidance on what information agencies should report, OMB cannot effectively monitor and evaluate the use of the DNP working system. Therefore, we do not believe that the OMB Circular A-136 sufficiently clarifies whether agencies should report on their uses of all of the functionalities of the DNP working system in their agency financial reports. As of February 2020, OMB has not provided any new status updates for this recommendation. We will continue to monitor OMB's actions to address this recommendation.

Recommendation: To ensure efficient use of federal resources, the Administrator of CMS should account for Medicaid payments a hospital has received that offset uncompensated care costs when determining hospital uncompensated care costs for the purposes of making Medicare UC payments to individual hospitals.

Agency: Department of Health and Human Services: Centers for Medicare and Medicaid Services
Status: Open
Priority recommendation

Comments: No executive action taken as of March 2020. CMS initially agreed with GAO's June 2016 recommendation. However, in October 2018, and again in December 2019 , CMS indicated that it was reconsidering whether to offset Medicare Uncompensated Care (UC) payments by Medicaid's uncompensated care payments. CMS stated that because Medicare UC payments are distributed based on hospitals' relative (not actual) uncompensated care costs, it would not be appropriate to account for Medicaid payments that reduce hospital uncompensated care. However, in some states Medicaid payments reduce or even eliminate hospital uncompensated care costs, which can result in an inequitable distribution of payments. Because the total amount of Medicare UC payments is capped, not accounting for Medicaid payments will result in hospitals that have little or no uncompensated care costs receiving a higher proportion of Medicare UC payments than warranted, resulting in in less funding for hospitals that actually have uncompensated care costs. Implementing GAO's recommendation would ensure that Medicare UC payments are based on accurate levels of uncompensated care costs and result in CMS better targeting billions of dollars in Medicare UC payments to hospitals that do have with the most uncompensated care costs, while avoiding making payments to hospitals with little or no uncompensated care costs.

Recommendation: The Secretary of Health and Human Services should direct the Administrator of CMS to assess the feasibility of updating the agency's study on the effect of VA-provided Medicare-covered services on per capita county Medicare FFS spending rates by obtaining VA utilization and diagnosis data for veterans enrolled in Medicare FFS under its existing data use agreement or by other means as necessary.

Agency: Department of Health and Human Services
Status: Open

Comments: In December 2017, the U.S. Department of Health and Human Services (HHS) indicated that it had further reviewed our recommendation and determined that updating the agency's study on the effect of VA-provided Medicare-covered services on per capita county Medicare fee-for-service (FFS) spending rates using the Department of Veterans Affairs' (VA) utilization and diagnosis data was not feasible. Challenges cited by HHS included (1) pricing each VA encounter using Medicare payment rules; (2) determining which Medicare provider would have treated each beneficiary; and (3) the resources required to have an ongoing data feed with VA and to protect VA utilization and diagnosis data. While we acknowledge that there may be challenges associated with incorporating VA utilization and diagnosis data into HHS's analysis, we believe that HHS needs to do additional work before it can determine whether such an approach is feasible. For example, while HHS noted resource concerns related to sharing and storing sensitive VA data, the agency already receives and stores some VA data. It remains unclear whether HHS has assessed what additional resources would be needed to store VA utilization and diagnosis data and whether such data would need to be shared via an ongoing data feed-another challenge mentioned by HHS. As of June 2020, HHS has not provided us with any additional information about actions it has taken to address this recommendation. We continue to believe that HHS should assess the feasibility of implementing a methodology for estimating the effect of VA-provided Medicare-covered services on per capita county Medicare FFS spending rates that incorporates VA data.

Recommendation: If CMS makes an adjustment to the benchmark to account for VA spending on Medicare-covered services, the Secretary of Health and Human Services should direct the Administrator of CMS to assess whether an additional adjustment to MA payments is needed to ensure that payments to MA plans are equitable for veterans and nonveterans.

Agency: Department of Health and Human Services
Status: Open

Comments: In December 2017, the U.S. Department of Health and Human Services (HHS) indicated that there are a number of limitations that would impede the Centers for Medicare & Medicaid Services' (CMS) ability to conduct an analysis of veteran versus nonveteran payments to MA plans. HHS indicated that in order to conduct a thorough assessment, CMS would need utilization and diagnosis data from the Department of Veterans Affairs (VA), which would take several years to collect and analyze. In addition, HHS indicated that if CMS determined an adjustment was needed, the agency would have to overcome other data, operational, and financial challenges related to making the adjustment. As a result, HHS indicated that implementing such an adjustment would be infeasible. However, CMS currently adjusts the benchmark to account for VA spending on Medicare-covered services without VA utilization and diagnosis data. While we agree that VA utilization and diagnosis data may improve the accuracy of an adjustment to MA payments to ensure that payments to MA plans are equitable for veterans and nonveterans, it is unclear why CMS could not make an adjustment without VA utilization and diagnosis data. As of June 2020, HHS has not provided us with any additional information about actions it has taken to address this recommendation. In order for us to close this recommendation, CMS would need to assess whether an additional adjustment to MA payments is needed.

Recommendation: To promote consistency in the distribution of supplemental payments among states and with CMS policy, the Administrator of CMS should issue written guidance clarifying its policy that requires a link between the distribution of supplemental payments and the provision of Medicaid-covered services.

Agency: Department of Health and Human Services: Centers for Medicare and Medicaid Services
Status: Open
Priority recommendation

Comments: CMS issued a proposed rule in November 2019 that may address this issue. According to the agency, the rule will promote state accountability, improve federal oversight, and strengthen the fiscal integrity of Medicaid. Specifically, the agency said the rule would require states to report to CMS a comprehensive description of the methodology used to calculate the amount and distribution of supplemental payments and the provider metrics used to calculate payment amounts, such as Medicaid utilization or costs. We will assess the extent to which the final rule addresses our recommendation when it is issued.

Recommendation: To promote consistency in the distribution of supplemental payments among states and with CMS policy, the Administrator of CMS should issue written guidance clarifying its policy that payments should not be made contingent on the availability of local funding.

Agency: Department of Health and Human Services: Centers for Medicare and Medicaid Services
Status: Open
Priority recommendation

Comments: CMS issued a proposed rule in November 2019 that may address this issue. According to the agency, the rule will promote state accountability, improve federal oversight, and strengthen the fiscal integrity of Medicaid. Specifically, the proposed rule clarifies the agency policy that Medicaid payments may not be contingent on the availability of local funding, according to agency officials. We will assess the extent to which the final rule addresses our recommendation when it is issued.

Recommendation: In order to prevent the shift of services from physician offices to HOPDs from increasing costs for the Medicare program and beneficiaries, Congress should consider directing the Secretary of HHS to equalize payment rates between settings for E/M office visits--and other services that the Secretary deems appropriate--and to return the associated savings to the Medicare program.

Agency: Congress
Status: Open

Comments: The Bipartisan Budget Act of 2015, enacted in November 2015, partially addressed our recommendation as it limits certain providers from billing at higher hospital outpatient department payment rates. Specifically, the legislation excludes services furnished by off-campus hospital outpatient departments from reimbursement under Medicare's hospital outpatient prospective payment system, effective January 1, 2017. According to the Congressional Budget Office, this action saves the Medicare program $9.3 billion over 10 years. However, the Act does not apply to services furnished by providers billing as hospital outpatient departments prior to enactment of the legislation-which includes providers billing as hospital outpatient departments during the study period in our report-as well as hospital outpatient departments located on hospital campuses. This means that, even in 2017 and beyond, many providers will not be affected by the Act, and Medicare will continue to pay more than necessary for certain services. In November 2018, CMS issued a final rule adopting payment changes-that have since been partially overturned under a decision by a federal district court, which CMS has appealed-capping payment rates for certain services furnished by the off-campus hospital outpatient departments that existed or were under construction in 2015 at the physician fee schedule rate. Since these services furnished by these off-campus hospital outpatient departments were paid under a higher rate, the payment cap, which was to be implemented over 2 years, was intended to equalize payment rates for certain clinical visits between settings. In 2019, CMS applied 50 percent of the payment reduction and in 2020 and subsequent years planned to apply 100 percent of the payment reduction. The rule applied to specific clinical visits; and other services would continue to be paid at the higher rate. However, a federal district court overturned the payment cap in September 2019. CMS has appealed that ruling and adopted a final rule in November 2019 that will implement the payment reduction in 2020. A lawsuit challenging the November 2019 final rule has been filed.

Recommendation: To determine the extent to which Medicare payments are aligned with costs for specific types of dialysis treatment and training, the Administrator of CMS should take steps to improve the reliability of the cost report data for treatment and training associated with specific types of dialysis.

Agency: Department of Health and Human Services: Centers for Medicare and Medicaid Services
Status: Open

Comments: As of February 2020, CMS has not implemented this recommendation. HHS agreed with this recommendation and stated in February 2020 that CMS was exploring ways to clarify the cost report instructions in an effort to improve the accuracy of the information submitted. We will update the status of this recommendation when we receive additional information.

Recommendation: To ensure that patients with chronic kidney disease receive objective and timely education related to this condition, the Administrator of CMS should examine the Kidney Disease Education benefit and, if appropriate, seek legislation to revise the categories of providers and patients eligible for the benefit.

Agency: Department of Health and Human Services: Centers for Medicare and Medicaid Services
Status: Open

Comments: As of February 2020, CMS has not implemented this recommendation. HHS did not agree with this recommendation and stated in June 2016 that CMS continuously works to pay appropriately for ESRD services and must prioritize its activities to improve care for dialysis patients. While we acknowledge the need for CMS to prioritize its activities to improve dialysis care, it is important for CMS to help ensure that Medicare patients with chronic kidney disease understand their condition, how to manage it, and the implications of the various treatment options available, particularly given the central role of patient choice in dialysis care. The limited use of the Kidney Disease Education benefit that we noted in our report suggests that it may be difficult for Medicare patients to receive this education and underscores the need for CMS to examine and potentially revise the benefit. We will update the status of this recommendation when we receive additional information.

Recommendation: To help improve CMS's process for establishing relative values for Medicare physicians' services, the Administrator of CMS should better document the process for establishing relative values for Medicare physicians' services, including the methods used to review RUC recommendations and the rationale for final relative value decisions.

Agency: Department of Health and Human Services: Centers for Medicare and Medicaid Services
Status: Open

Comments: To help improve the Centers for Medicare & Medicaid Service's (CMS) process for establishing relative values for Medicare physicians' services, in May 2015 we recommended that the Administrator of CMS better document the process, including the methods used to review recommendations from the American Medical Association/Specialty Society Relative Value Scale Update Committee (RUC) and the rationale for final relative value decisions. CMS concurred with this recommendation, stating that CMS establishes relative values for new, revised, and potentially misvalued physicians' services based on its review of a variety of sources of information, including the RUC. At that time, CMS officials told us the agency was working to improve the transparency of its process by proposing and finalizing changes to the process in the annual rule for the Physician Fee Schedule. Officials estimated that this process would take several years to complete. In order to close this recommendation as implemented, CMS will need to demonstrate that it has improved its internal and external documentation of its process for establishing relative values. As of June 2020, GAO was still waiting on confirmation from CMS that it had completed its enhancement process for establishing relative values for Medicare physicians' services in a way that would allow for greater transparency and documentation. CMS will need to demonstrate that it has improved its internal and external documentation for establishing relative values in order for GAO to close the recommendation. CMS officials agreed the recommendation should remain open as progress continues.

Recommendation: To help improve CMS's process for establishing relative values for Medicare physicians' services, the Administrator of CMS should develop a process for informing the public of potentially misvalued services identified by the RUC, as CMS already does for potentially misvalued services identified by CMS or other stakeholders.

Agency: Department of Health and Human Services: Centers for Medicare and Medicaid Services
Status: Open

Comments: To help improve the Centers for Medicare & Medicaid Service's (CMS) process for establishing relative values for Medicare physicians' services, in May 2015 we recommended that the Administrator of CMS develop a process for informing the public of potentially misvalued services identified by the American Medical Association/Specialty Society Relative Value Scale Update Committee (RUC), as CMS already does for potentially misvalued services identified by CMS or other stakeholders. CMS did not concur with this recommendation, asserting that the RUC is completely independent of CMS, and as such CMS has no authority to set the RUC's agenda for which services are reviewed. As of June 2020, CMS had not changed its position on the recommendation. We continue to believe that CMS needs to inform the public of potentially misvalued services identified by the RUC, as it does for potentially misvalued services identified by other stakeholders. We acknowledge that in 2017 CMS changed its process for establishing relative values by including proposed values for almost all services in the annual proposed rulemaking for the Physician Fee Schedule, which means that the changes in values for potentially misvalued services identified by the RUC are open for public comment before they become effective. However, we continue to believe CMS should inform stakeholders of these potentially misvalued services before CMS receives RUC recommendations for them and subsequently publishes the values in the proposed rule. Doing so would give stakeholders the same amount of time they have to provide input on potentially misvalued services identified by other stakeholders.

Recommendation: To help improve CMS's process for establishing relative values for Medicare physicians' services, the Administrator of CMS should incorporate data and expertise from physicians and other relevant stakeholders into the process as well as develop a timeline and plan for using the funds appropriated by the Protecting Access to Medicare Act of 2014.

Agency: Department of Health and Human Services: Centers for Medicare and Medicaid Services
Status: Open

Comments: To help improve the Centers for Medicare & Medicaid Service's (CMS) process for establishing relative values for Medicare physicians' services, in May 2015 we recommended that the Administrator of CMS incorporate data and expertise from physicians and other relevant stakeholders into the process, as well as develop a timeline and plan for using the funds appropriated by the Protecting Access to Medicare Act of 2014 (PAMA). CMS concurred with this recommendation, stating that stakeholders have the opportunity each year to nominate potentially misvalued services for review through a public nomination process. In August 2017, CMS officials reported that the final rulemaking for the 2017 Physician Fee Schedule included a data collection effort using PAMA funds and other authorities that will help furnish data to help in valuations for more than half of physician services. However, this effort pertains to global services, which are a specific type of service under the Physician Fee Schedule that include global, professional, and technical components, and does not apply to non-global services, which encompass almost half of physician services. Officials also reported that they had awarded a contract to explore data collection on practice expense and methodologies for using such data when valuing services in the Physician Fee Schedule. However, CMS did not indicate a specific timeline and plan for using the PAMA funds, just that the agency would continue to use these funds to explore more ways to gain improved data. In March 2018, CMS reported that it now incorporates data and expertise from relevant stakeholders-apart from the RUC-into its process for establishing relative values by including any new, revised, or potentially misvalued values in the annual proposed rulemaking, instead of establishing them on an interim final basis in the final rule. This means that the changes in values for services will be open for public comment prior to the implementation of changes to payment. We acknowledge that CMS has made progress towards meeting our recommendation by changing its process to allow for public comments on proposed changes to relative values before they go into effect. CMS has also made progress by beginning to use PAMA funds to assist with valuing global services and exploring avenues for collecting practice expense data. To close this recommendation, we need documentation that CMS has started to incorporate data more broadly into its process for establishing relative values and that it has a documented timeline and plan for how it will use the funds appropriated by the Protecting Access to Medicare Act of 2014. As of June 2020, we had not received this documentation.

Recommendation: To better assess and address the full extent of improper payments in the TRICARE program, the Secretary of Defense should direct the Assistant Secretary of Defense (Health Affairs) to implement a more comprehensive TRICARE improper payment measurement methodology that includes medical record reviews, as done in other parts of its existing postpayment claims review programs.

Agency: Department of Defense
Status: Open
Priority recommendation

Comments: The Department of Defense (DOD) concurred with our recommendation. As of November 2019, the DOD's Defense Health Agency (DHA) has taken some action to incorporate medical record reviews in its improper payment estimate, as GAO recommended in February 2015. In June 2017, DHA awarded a contract for TRICARE claims review services which, according to DHA officials, will allow the agency to implement a more comprehensive improper payment measurement methodology using retrospective medical records reviews. As of November 2019, the agency reported to Congress that its managed care support contracts now included medical record reviews. It also expected to include payment error results from medical record reviews in its improper payment calculation for fiscal year 2020. DOD also planned to report the effect of medical record reviews on its improper payment rate in a report to Congress in March 2020. Once DHA incorporates medical record reviews in its improper payment rate calculation methodology, GAO will be able to close this recommendation.

Recommendation: To better assess and address the full extent of improper payments in the TRICARE program, and once a more comprehensive improper payment methodology is implemented, the Secretary of Defense should direct the Assistant Secretary of Defense (Health Affairs) to develop more robust corrective action plans that address underlying causes of improper payments, as determined by the medical record reviews.

Agency: Department of Defense
Status: Open
Priority recommendation

Comments: The Department of Defense concurred with our recommendation. As of November 2019, the Department of Defense's Defense Health Agency (DHA) has taken steps to implement a more comprehensive TRICARE improper payment measurement methodology. Until the department fully implements the new methodology and identifies the underlying causes of improper payments, the full extent of improper payments in the TRICARE program will likely not be identified and addressed. As of November 2019, the DHA has not yet fully implemented a more comprehensive measurement methodology, and has, therefore, not developed more robust corrective action plans.

Recommendation: To ensure that MA encounter data are of sufficient quality for their intended purposes, the Administrator of CMS should establish specific plans and time frames for using the data for all intended purposes in addition to risk adjusting payments to MAOs.

Agency: Department of Health and Human Services: Centers for Medicare and Medicaid Services
Status: Open
Priority recommendation

Comments: HHS generally agreed with this recommendation. Although CMS reports using MA encounter data for purposes other than risk adjustment, as of February 2020, it has not fully developed specific plans and time frames with dates for all uses. CMS reports that it has begun testing the use of MA encounter data for public health purposes, such as identifying beneficiaries with a history of opioid-related overdose and with other conditions, such as cancer and sickle cell. Further, CMS uses MA encounter data to help identify beneficiaries at risk in areas affected by public health emergencies. CMS reports that its Office of the Actuary (OACT) has used MA encounter data to analyze MA beneficiary utilization of certain Part B drugs. Further, OACT reports that it intends to assess other areas where it could use MA encounter data, such as analyses comparing Medicare fee-for-service and MA. As of February 2020, the agency has not developed specific plans and time frames for this and other intended purposes. For example, although CMS intends to use MA encounter data for program integrity purposes, it has not yet developed specific plans and time frames to do so. We will continue to monitor CMS's progress in developing specific plans and time frames with dates for all intended purposes of MA encounter data.

Recommendation: To ensure that MA encounter data are of sufficient quality for their intended purposes, the Administrator of CMS should complete all the steps necessary to validate the data, including performing statistical analyses, reviewing medical records, and providing MAOs with summary reports on CMS's findings, before using the data to risk adjust payments or for other intended purposes.

Agency: Department of Health and Human Services: Centers for Medicare and Medicaid Services
Status: Open
Priority recommendation

Comments: HHS generally agreed with this recommendation, however, HHS did not commit to completing data validation before using MA encounter data for risk adjustment. As of February 2020, CMS has continued to make progress in examining the completeness and accuracy of MA encounter data, but more work remains to fully validate these data. CMS has developed and is implementing an MA Encounter Data Integrity and Monitoring plan, which includes data analysis, guidance, and monitoring. As part of this plan, CMS has established preliminary performance metrics for MA encounter data completeness and accuracy. CMS is also conducting analyses related to accuracy and completeness, but has not established performance benchmarks for these analyses. While the agency plans to communicate findings from the analyses to Medicare Advantage organizations, it has not yet done so. Finally, CMS has not verified MA Encounter data by reviewing medical records. While these steps are encouraging, without fully validating the completeness and accuracy of MA encounter data, CMS would be unable to confidently use these data for risk adjustment or other program management or policy purposes.

Recommendation: The Secretary of Defense should direct the Under Secretary of Defense for Personnel and Readiness to coordinate with the services on conducting research, as appropriate, to determine optimal bonus amounts.

Agency: Department of Defense
Status: Open

Comments: In a July 2012 report, the USD (P&R) stated that it continued to believe that a study to determine optimal bonus amounts would be beneficial. As of September 2015, DOD was working with the RAND Corporation to develop a model to analyze the impact of adjusting bonuses and special pays for certain personnel communities. According to officials at USD (P&R) the goal of this effort was to provide the services with a tool that can be used to set bonuses and special pays more efficiently. The officials added that models have been developed for officers in the aviation community, and are currently being developed for officers in the healthcare and special operations communities. OSD officials reported in February 2017 that the study by RAND covering all bonuses and special pays had still not been issued. RAND did issue a study, but it covered only mental health care officers. As of November 2019, DOD has not taken any further action on this recommendation.

Recommendation: The Secretary of Defense should direct the Under Secretary of Defense for Personnel and Readiness, as the consolidation of the special and incentive pay programs is completed over the next 7 years and the instructions directing the services on how to administer the new programs are revised, to monitor the implementation of this consolidation to determine whether it is in fact resulting in greater flexibility and more precise targeting of resources and what impact the consolidation is having on DOD's budget.

Agency: Department of Defense
Status: Open

Comments: In a July 2012 report, the USD (P&R) stated that it was continuing to consolidate special and incentive pay authorities. However, because this consolidation was not yet complete, it has not yet determined whether this consolidation has resulted in greater flexibility, as GAO recommended. In June 2013, OSD reported that OSD was about halfway through with its effort to consolidate special pay authorities, and in September 2015 USD (P&R) officials stated that this effort is continuing. The officials added that, while the Department is tracking the impact of the consolidation on the cost of special and incentive pays, it had not assessed whether the consolidation had resulted in greater flexibility. OSD officials reported that in November 2019 it had still not completed a study of whether the consolidation had resulted in greater flexibility.

Recommendation: To help ensure that Medicare beneficiaries have access to high-quality dialysis care, the Administrator of CMS should assess the extent to which the bundled payment for dialysis care will be sufficient to cover an efficient dialysis organization's costs to provide such care when the bundled payment expands to cover oral-only ESRD drugs. The Administrator should conduct this assessment before implementing this expanded bundled payment.

Agency: Department of Health and Human Services: Centers for Medicare and Medicaid Services
Status: Open

Comments: CMS, as required by the Protecting Access to Medicare Act of 2014 (PAMA), delayed until 2024 when the bundled payment for dialysis care is expanded to cover oral-only ESRD drugs. Because PAMA requires CMS to use the most recent year of data available to implement this payment change, CMS has been unable to implement our recommendation. We will update the status of this recommendation upon receipt of additional information from CMS.

Recommendation: To ensure that savings are realized from the implementation of an MPPR or other policies that reflect efficiencies occurring when services are furnished together, Congress may wish to consider exempting these savings from budget neutrality.

Agency: Congress
Status: Open

Comments: Congress has exempted savings from the implementation of multiple procedure payment reductions (MPPR) for certain diagnostic imaging and therapy services from the budget neutrality requirement, as GAO suggested in July 2009. However, as of January 2020, other policies that may result in a reduction in payments for the professional component for imaging services remained subject to budget neutrality; "savings" from these services are redistributed to other services and do not accrue to the Medicare program. The Consolidated Appropriations Act of 2016 revised the payment reduction for the professional component of multiple diagnostic imaging services from 25 percent to 5 percent beginning on January 1, 2017, and exempted the reduced expenditures attributable to this MPPR from the budget neutrality provision. MPPRs or other policies that may result in a reduction to payments for the technical component for diagnostic cardiovascular and ophthalmology services continue to be subject to budget neutrality for 2020. Unless Congress exempts from the budget neutrality requirement savings realized from the implementation of all MPPRs or other policies that reflect efficiencies occurring when services are furnished together, these savings will not accrue to the Medicare program.

Recommendation: To enhance the transparency of CMS oversight and clarify and communicate the types of allowable state financing arrangements, the Administrator of CMS should provide each state CMS reviews under its initiative with specific and written explanations regarding agency determinations on the allowability of various arrangements for financing the nonfederal share of Medicaid payments and make these determinations available to all states and interested parties.

Agency: Department of Health and Human Services: Centers for Medicare and Medicaid Services
Status: Open

Comments: CMS has taken steps to provide states with specific and written explanations regarding agency determinations on whether various arrangements for financing the nonfederal share of Medicaid payments are allowable and making those determinations available to states and interested parties. In November 2019, CMS issued a proposed rule that the agency said would promote state accountability, improve federal oversight, and strengthen fiscal integrity of the Medicaid program. The proposed rule would establish new policies and codify existing policies related to the sources of funds that states use to finance the nonfederal share of Medicaid payments. For example, the rule is intended to provide CMS and states with better information and guidance to identify existing and emerging state financing issues, provide more clarity on allowable financing arrangements and promote state accountability. GAO will continue to monitor the status of the proposed rule, as well as review a final rule, if one is issued, to determine the extent to which it addresses the recommendation.