Proposal To Improve Identification and Collection of Medicare Part B Duplicate Payments

GAO reviewed the operations of selected Medicare claims processing contractors to determine whether it would be cost beneficial for the carriers to periodically screen their claims on a postpayment basis to recover duplicate payments.

GAO found that screening paid claims to identify duplicate payments could be cost beneficial. For two of the contractors, GAO identified an estimated $184,700 in duplicate payments on which it believed the carriers should follow up. The carriers estimated that their costs to investigate and take the necessary recovery steps would be about $77,800. Prior work showed that carriers' programs to identify or recover overpayments for medically unnecessary services on an after-the-fact or postpayment basis had not been cost beneficial at six of nine carriers reviewed and had about broken even at the other three. Although GAO has supported the postpayment utilization review function because of the deterrent effect on program abuse and other nonquantifiable benefits, GAO believes that a postpayment duplicate payment detection effort offers opportunities for substantially more favorable cost benefit results than the carriers' postpayment utilization review activities. Detecting and denying duplicate claims before payment is far better than identifying and attempting to recover an erroneous payment. GAO believes that, in the long run, the most important benefit of screening paid claims may be that carriers will be better able to identify and correct the billing or processing problems that allowed the duplicate payments to be made. If so, duplicate payments may be reduced to the point that screening paid claims will not be worthwhile.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

Director: Michael Zimmerman Team: General Accounting Office: Human Resources Division Phone: (202) 275-6195