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AIMD-95-234R 1 (1995-09-29)

handle is hein.gao/gaobackyl0001 and id is 1 raw text is: 


GAO              United States
                 General Accounting Office
                 Washington, D.C. 20548

                 Accounting and Information
                 Management Division

                 B-261034


                 September 29, 1995

                 The Honorable Tom Harkin
                 Ranking Minority Member
                 Subcommittee on Labor, Health
                 and Human Services, Education,
                 and Related Agencies
                 Committee on Appropriations
                 United States Senate

                 Dear Senator Harkin:

                 During a May 5, 1995, hearing before the Senate Appropriations Subcommittee on
                 Labor, Health and Human Services, Education, and Related Agencies, you requested
                 that the Health Care Financing Administration (HCFA) provide information on its
                 assessment of savings that would be achieved with a commercial system to detect
                 billing abuse in the Medicare program. At the hearing and in our report issued that
                 day,1 we estimated that $640 million could have been saved in 1994 by using available
                 commercial systems. We recommended that, when processing Medicare claims for
                 physician services and supplies, Medicare carriers use a commercial system to detect
                 code manipulation. This letter is an interim response to your request that we evaluate
                 HCFA's approach to analyzing the benefits of commercial technology in the Medicare
                 program. As discussed with your office, we will continue to monitor HCFA's analysis.

                 On June 30, 1995, HCFA's Associate Administrator for Operations and Resource
                 Management provided you with a description of HCFA's plan to determine whether
                 commercial systems are appropriate for the Medicare program. This plan includes
                 validating our savings estimate; implementing new unbundling edits to detect abuse;
                 and, if appropriate, testing and deploying a commercial system. HCFA's methodology
                 for verifying our savings estimate calls for Medicare carriers to indicate whether they


                 'Medicare Claims Billing Abuse: Commercial Software Could Save Hundreds of
                 Millions Annually (GAO/T-AIMD-95-133, May 5, 1995) and Medicare Claims:
                 Commercial Technology Could Save Billions Lost to Billing Abuse (GAO/AIMD-95-
                 135, May 5, 1995).


GAO/AIMD-95-234R HCFA's Approach to Evaluating Medicare Technology

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