VA Health Care

Medical Care Cost Recovery Activities Improperly Funded Gao ID: HRD-94-2 October 12, 1993

Before 1990, the 158 medical centers run by the Department of Veterans Affairs (VA) used medical care appropriations to finance the recovery of health care costs from veterans or third parties. In November 1990, Congress established a Medical-Care Cost Recovery Fund to finance all recovery expenses related to collecting the cost of medical care and services provided by VA. This report examines whether medical centers were using only the fund to underwrite cost recovery activities. GAO also reviews VA's efforts to improve the efficiency of its recovery activities.

GAO found that: (1) VA medical centers used the MCCR Fund in fiscal year 1992 to finance cost recovery activities; (2) some VA medical centers used VA medical care appropriations to finance cost recovery activities, even though federal law prohibits such use; (3) VA needs to examine medical centers' internal accounting and administrative controls and initiate appropriate actions to ensure that all medical care cost recovery activities are correctly identified and charged to the MCCR Fund; (4) some VA medical centers are using inefficient recovery procedures that increase their administrative costs; and (5) VA has several departmentwide actions under way that will help its medical centers better contain recovery costs.

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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