Medicare

Millions in Disabled Beneficiary Expenditures Shifted to Employers Gao ID: HRD-91-24 April 10, 1991

Pursuant to a legislative requirement, GAO determined the: (1) annual cost savings to Medicare from its becoming a secondary payer for certain disabled beneficiaries; and (2) effects of the secondary payment provision on employment and employment-based health coverage of disabled beneficiaries and their family members.

GAO found that: (1) Medicare saved about $322 million because of the provision; (2) Medicare could have saved an additional $148 million had the program not made erroneous payments as a primary payer for some health care services provided to ineligible beneficiaries; (3) Medicare saved about $83 million from the provision's effect on 55,000 disabled beneficiaries who had their own health coverage under employer-sponsored group health plans; (4) the provision had little adverse effect on disabled beneficiaries or their family members in terms of employment or the cost and availability of employer-sponsored health insurance; and (5) the secondary provision had little effect on the disabled, but some employers were contemplating changes that could adversely affect disabled employees.

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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