Flawed Data Add Millions to Teaching Hospital Payments Gao ID: IMTEC-91-31 June 4, 1991

GAO discussed the: (1) accuracy of resident and bed count data that teaching hospitals submitted to the Health Care Financing Administration (HCFA); (2) effect of inaccurate data on Medicare payments to those hospitals; and (3) adequacy of HCFA internal controls over such data.

GAO found that: (1) teaching hospitals overreported the number of residents by claiming residents who were actually at Department of Defense (DOD) or Veterans Affairs (VA) facilities; (2) HCFA guidance for counting available beds was confusing, counting practices varied widely among hospitals, and efforts to clarify guidance were not successful; (3) HCFA allowed hospitals to exclude beds used to treat sick newborns if the beds were located in units not specified in HCFA guidance, even though this practice was inconsistent with a federal court decision; (4) HCFA lacked effective techniques for identifying instances in which hospitals improperly claimed DOD and VA residents; and (5) inaccurate and unverifiable data caused Medicare to pay millions in unnecessary indirect medical education costs.


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