Medicare

Experience Shows Ways to Improve Oversight of Health Maintenance Organizations Gao ID: HRD-88-73 August 17, 1988

In response to a congressional request, GAO reviewed the Health Care Financing Administration's (HCFA) efforts to deal with health maintenance organizations' (HMO) compliance problems, specifically: (1) the adequacy of data to determine the quality and cost of HMO care; (2) the adequacy of HCFA staff levels to monitor HMO; and (3) HCFA willingness to act when HMO fail to meet federal requirements.

GAO found that HCFA: (1) had no data on HMO use of physician or outpatient services and limited data on their use of inpatient services, since it compiled data primarily to monitor participants' compliance with financial solvency requirements and to calculate payments; (2) initiated HMO peer reviews and the Beneficiary Inquiry Tracking System to increase its ability to monitor HMO quality; (3) did not increase staffing or monitoring resources to keep pace with HMO growth and increased Medicare enrollments; (4) implemented new compliance monitoring procedures requiring reviews of HMO every 2 years to identify and resolve problems early; and (5) was generally successful in resolving HMO compliance problems, but was reluctant to terminate contracts with recurring compliance problems because of its concern over possible adverse effects on Medicare beneficiaries.

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.

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