oversight

Department of Health and Human Services: Opportunities for Financial Savings and Program Improvements in Medicare and Medicaid Remain

Published by the Government Accountability Office on 2012-05-09.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                             United States Government Accountability Office

GAO                          Testimony
                             Before the Subcommittee on Oversight
                             and Investigations, Committee on Energy
                             and Commerce, House of Representatives

                             DEPARTMENT OF
For Release on Delivery
Expected at 10:00 a.m. EDT
Wednesday, May 9, 2012

                             HEALTH AND HUMAN
                             SERVICES
                             Opportunities for Financial
                             Savings and Program
                             Improvements in Medicare
                             and Medicaid Remain
                             Statement of James Cosgrove
                             Director, Health Care
                             Carolyn L. Yocom
                             Director, Health Care




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GAO-12-719T
                                              May 9, 2012

                                              DEPARTMENT OF HEALTH AND HUMAN
                                              SERVICES
                                              Opportunities for Financial Savings and Program
Highlights of GAO-12-719T, before the
                                              Improvements in Medicare and Medicaid Remain
Subcommittee on Oversight and
Investigations, Committee on Energy and
Commerce, House of Representatives



Why GAO Did This Study                        What GAO Found
HHS manages hundreds of complex               Over the past several years, GAO has made a number of recommendations to
programs benefiting the health and            the Centers for Medicare & Medicaid Services (CMS)—an agency within the
well-being of Americans, accounting           Department of Health and Human Services (HHS)—to increase savings in
for a quarter of all federal outlays. For     Medicare fee-for-service and Medicare Advantage (MA), which is a private plan
fiscal year 2012, HHS is responsible          alternative to the traditional Medicare fee-for-service program. Open
for approximately $76 billion in              recommendations that could yield billions of dollars in savings remain in many
discretionary spending and for an             areas, such as the following:
estimated $788 billion in mandatory
spending. The size and critical mission       •   Minimizing improper payments and fraud in Medicare. GAO
of the two largest HHS programs,                  recommended that CMS require contractors to automate prepayment
Medicare and Medicaid, make it                    controls to identify potentially improper claims for medical equipment and
imperative that HHS is fiscally prudent           supplies, expand current regulations to revoke billing privileges for home
yet vigilant in protecting the                    health agencies with improper billing practices, designate authorized
populations that depend on these                  personnel to evaluate and address vulnerabilities in payment systems, and
programs. In recent years, GAO has                enhance payment safeguards for physicians who use advanced imaging
identified shortcomings and                       services.
recommended actions to enhance
operations and correct inefficiencies in      •   Aligning coverage with clinical recommendations. GAO recommended
Medicare and Medicaid, and HHS has                that CMS provide coverage for services recommended by clinical experts, as
implemented many recommendations,                 appropriate, given cost-effectiveness and other criteria.
resulting in billions of dollars in
savings. Because agencies now must            •   Better aligning payments to MA plans. To ensure that payments to MA
do more with less, recommendations                plans reflect the health status of beneficiaries, GAO recommended that CMS
not yet implemented are opportunities             more accurately adjust for differences between MA plans and traditional
for further conserving HHS funds and              Medicare providers in reporting beneficiary diagnoses. GAO also
strengthening oversight of programs               recommended that CMS cancel the MA Quality Bonus Payment
serving the nation’s most vulnerable
                                                  Demonstration because its design precludes it from yielding meaningful
populations.
                                                  results.
GAO was asked to testify on issues
related to HHS’s budget. This
                                              GAO has made recommendations to CMS regarding Medicaid program
statement draws from GAO’s prior              oversight. Open recommendations remain in many areas, such as the following:
work, including work on these two             •   Improving oversight of Medicaid payments. GAO recommended that
high-risk programs, in which GAO                  CMS adopt transparency requirements and a strategy to ensure that
made recommendations related to                   supplemental payments to providers have been reviewed by CMS. These
(1) the management of Medicare and                supplemental payments are separate from and in addition to those made at
(2) the need for additional oversight of
                                                  states’ regular Medicaid rates.
Medicaid. To the extent information
was available, GAO updated the status         •   Ensuring Medicaid demonstrations do not increase federal liability.
of these recommendations.                         GAO recommended that CMS revise its approval process for demonstrations
                                                  to ensure they are budget neutral, which GAO subsequently referred to
                                                  Congress as a matter for consideration.
                                              The size of Medicare and Medicaid requires CMS to focus continually on the
                                              appropriateness of the methodology for payments that these programs make and
                                              the pre- and postpayment checks that can help ensure that program spending is
                                              appropriate, overpayment recovery is expedient, and agency practices with
View GAO-12-719T. For more information,       regard to operations for these programs are efficient. Therefore, GAO urges
contact James Cosgrove at (202) 512-7114 or   HHS to ensure action is taken on open recommendations to advance its
cosgrovej@gao.gov or Carolyn L. Yocom at      performance and accountability.
(202) 512-7114 or yocomc@gao.gov.
                                                                                     United States Government Accountability Office
Chairman Stearns, Ranking Member DeGette, and Members of the
Subcommittee:

We are pleased to be here today to discuss budget considerations at the
Department of Health and Human Services (HHS). As the federal
government’s principal agency for protecting the health of Americans and
providing essential human services, especially for vulnerable populations,
HHS manages over 300 highly complex programs, which account for
almost a quarter of all federal outlays. For fiscal year 2012, HHS is
responsible for approximately $76 billion in discretionary spending and
approximately $788 billion in outlays of mandatory spending. With this
funding, HHS provides health care insurance for one in four Americans
through its two largest programs—Medicare and Medicaid—and
administers more grant dollars than all other federal agencies combined.
HHS also funds disease research and prevention, oversees the safety
and effectiveness of medical products, and helps ensure that the nation is
prepared to respond to public health emergencies, among other things.
HHS’s size, diverse programs, and critical mission render its finances
particularly important as Congress and the administration seek to
decrease the cost of government while improving its performance and
accountability.

In recent years, we have examined a broad range of issues, identified
program design and oversight shortcomings, and made numerous
recommendations to enhance agency operations. In particular, many of
these recommendations relate to the Medicare and Medicaid programs—
which are the responsibility of the Centers for Medicare & Medicaid
Services (CMS), an agency within HHS. HHS has implemented many of
these recommendations, resulting in billions of dollars of savings. Other
recommendations have led to program improvements that, while not
always quantifiable, have nonetheless enhanced the efficiency of agency
operations. For example, in 2004, we reported on CMS’s management of
its Medicare Secondary Payer debt, which occurs when Medicare pays
for services that are subsequently determined to be the financial
responsibility of another payer. 1 CMS’s implementation of our
recommendation that it reduce the number of contractors managing this
workload resulted in savings of $86 million from 2006 through 2010. More



1
 GAO, Medicare Secondary Payer: Improvements Needed to Enhance Debt Recovery
Process, GAO-04-783 (Washington, D.C.: Aug. 20, 2004).




Page 1                                                              GAO-12-719T
recently, greater savings have been realized as a result of work on CMS’s
oversight of states’ Medicaid supplemental payment arrangements. 2 In
2007, we reported on a CMS oversight initiative established in response
to our work, which increased the agency’s scrutiny of state Medicaid
financing arrangements and resulted in savings of approximately
$3.4 billion from fiscal year 2007 through 2012. 3

While HHS has successfully implemented many of our recommendations,
our remarks today will focus on spending for which HHS is responsible in
the context of recommendations we have made that it has yet to
implement and that we therefore consider open. Specifically, we will
concentrate on our recommendations to improve the Medicare and
Medicaid programs. We have designated both as high-risk programs, in
part because of their size, complexity, susceptibility to improper
payments, and the need to improve program management. 4 The
recommendations that we will discuss include those that were recently
made, those not yet fully implemented, and others for which no actions
have been taken, although several years have elapsed since they were
made. These recommendations—some of which could result in financial
savings—include those that address (1) missed opportunities for savings
in the management of Medicare and (2) the need for additional oversight
of Medicaid.

Our testimony today draws on our prior products, issued from January
2007 through April 2012, including our work on overlap and duplication of
federal programs that may result in inefficient use of taxpayer funds. 5 To
the extent that information was available, we updated the status of HHS’s


2
 Medicaid supplemental payments are payments separate from and in addition to those
made at states’ regular Medicaid rates.
3
 GAO, Medicaid Financing: Federal Oversight Initiative Is Consistent with Medicaid
Payment Principles but Needs Greater Transparency, GAO-07-214 (Washington, D.C.:
Mar. 30, 2007).
4
GAO, High-Risk Series: An Update, GAO-11-278 (Washington, D.C.: February 2011).
5
 GAO, 2012 Annual Report: Opportunities to Reduce Duplication, Overlap and
Fragmentation, Achieve Savings, and Enhance Revenue, GAO-12-342SP (Washington,
D.C.: Feb. 28, 2012); Follow-up on 2011 Report: Status of Actions Taken to Reduce
Duplication, Overlap, and Fragmentation, Save Tax Dollars, and Enhance Revenue,
GAO-12-453SP (Washington, D.C.: Feb. 28, 2012); and Opportunities to Reduce Potential
Duplication in Government Programs, Save Tax Dollars, and Enhance Revenue,
GAO-11-318SP (Washington, D.C.: Mar. 1, 2011).




Page 2                                                                   GAO-12-719T
                           implementation of these recommendations in May 2012. Detailed
                           information on the scope and methodology for our prior work can be
                           found in the reports that we have cited throughout this testimony. We
                           conducted the underlying performance audits in accordance with
                           generally accepted government auditing standards. Those standards
                           require that we plan and perform the audits to obtain sufficient,
                           appropriate evidence to provide a reasonable basis for our findings and
                           conclusions based on our audit objectives. We believe that the evidence
                           obtained provides a reasonable basis for our statement today.


                           In the past several years, we have made a number of recommendations
Missed Opportunities       for CMS to address missed opportunities for savings in the Medicare
for Savings in             program, which the agency has not fully implemented. These include
                           recommendations related to the Medicare fee-for-service (FFS) and
Medicare                   Medicare Advantage (MA) programs.


Medicare Fee-for-Service   Minimizing improper payments and fraud. We have a body of issued
                           and ongoing work about improper payments in Medicare. In 2007, we
                           reported on program integrity activities conducted by CMS contractors to
                           minimize improper payments for medical equipment and supplies. 6 We
                           recommended that CMS require its contractors to develop automated
                           prepayment controls to identify potentially improper claims when billing
                           reaches atypical levels. CMS agreed with the recommendation, but has
                           not implemented it. The agency has added other prepayment controls to
                           flag claims for services that were unlikely to be provided in the normal
                           course of medical care. However, implementing our recommendation and
                           adding additional prepayment controls could enhance identification of
                           improper claims before they are paid to reduce reliance on “pay and
                           chase” strategies. 7 In 2009, we reported that fraudulent and abusive
                           practices in home health agencies, such as overstating the severity of a
                           beneficiary’s condition, contributed to Medicare home health spending
                           and utilization. 8 To strengthen controls on improper payments in home


                           6
                            GAO, Medicare: Improvements Needed to Address Improper Payments for Medical
                           Equipment and Supplies, GAO-07-59 (Washington, D.C.: Jan. 31, 2007).
                           7
                           We have ongoing work updating CMS’s progress in implementing prepayment controls.
                           8
                            GAO, Medicare: Improvements Needed to Address Improper Payments in Home Health,
                           GAO-09-185 (Washington, D.C.: Feb. 27, 2009).




                           Page 3                                                                 GAO-12-719T
health agencies, we recommended that CMS amend current regulations
to expand the types of improper billing practices that are grounds for
revocation of billing privileges. CMS told us that it has begun to explore its
authority to expand the types of practices that are grounds for revocation
of billing rights. We believe that CMS should do so expeditiously.

In 2010, we recommended that CMS designate responsible personnel
with authority to evaluate and promptly address vulnerabilities identified to
reduce improper payments. 9 CMS concurred with this recommendation
and has begun to implement this process, but does not yet have written
policies and procedures for a fully developed corrective action process
that includes monitoring of actions taken. 10 Likewise, we recently testified
before the Senate Committee on Finance regarding CMS efforts to
combat Medicare fraud. 11 We reiterated our prior recommendation and
noted that CMS could do more to strengthen provider enrollment
screening to avoid enrolling those intent on committing fraud, improve
pre- and postpayment claims review to identify and respond to patterns of
suspicious billing activity more effectively, and identify and address
vulnerabilities to reduce the ease with which fraudulent entities can obtain
improper payments.

Enhancing payment safeguard mechanisms. In 2008, we reported on
rapid spending growth for advanced imaging services. 12 We
recommended that CMS examine the feasibility of adding front-end
approaches, such as prior authorization, to improve payment safeguard
mechanisms. CMS has not implemented our recommendation, but is
currently engaged in a demonstration project to assess the
appropriateness of physicians’ use of advanced diagnostic imaging
services furnished to Medicare beneficiaries.



9
 GAO, Medicare Recovery Audit Contracting: Weaknesses Remain in Addressing
Vulnerabilities to Improper Payments, Although Improvements Made to Contractor
Oversight, GAO-10-143 (Washington, D.C.: Mar. 31, 2010).
10
  We have ongoing work updating CMS’s progress in implementing these
recommendations.
11
  GAO, Medicare: Important Steps Have Been Taken, but More Could Be Done to Deter
Fraud, GAO-12-671T (Washington, D.C.: Apr. 24, 2012).
12
 GAO, Medicare Part B Imaging Services: Rapid Spending Growth and Shift to
Physician Offices Indicate Need for CMS to Consider Additional Management Practices,
GAO-08-452 (Washington, D.C.: June 13, 2008).




Page 4                                                                    GAO-12-719T
                     Aligning coverage for services with clinical recommendations. We
                     reported in early 2012 that Medicare beneficiaries’ use of preventive
                     services did not always align with the U.S. Preventive Services Task
                     Force’s recommendations. 13 We concluded that opportunities exist to
                     improve the appropriate use of preventive services through means such
                     as revising coverage and cost-sharing policies and educating
                     beneficiaries and physicians. In the case of osteoporosis screening, for
                     instance, Medicare coverage rules may preclude utilization of the
                     recommended screening by all those for whom the service is
                     recommended. Conversely, given that the Task Force recommended
                     against prostate cancer screening for men aged 75 or older, the absence
                     of cost sharing for that population may encourage inappropriate use of
                     this service. To better align preventive service use with clinical
                     recommendations, we recommended that CMS provide coverage for
                     Task Force recommended services, as appropriate, given cost-
                     effectiveness and other criteria. In response to our recommendation, the
                     agency stated that it had recently used its authority to expand benefits to
                     cover several new preventive services. This additional coverage,
                     however, does not address the misalignment that remains between
                     Medicare coverage for certain services and the corresponding Task Force
                     recommendations. We also offered a matter for congressional
                     consideration. We suggested that Congress consider requiring
                     beneficiaries to share the cost of the services if they receive services the
                     Task Force recommends against.


Medicare Advantage   Better reflecting beneficiary health status in payments to MA plans.
                     In 2010, the federal government spent about $115 billion on the MA
                     program, a private plan alternative to the Medicare FFS program. In
                     January 2012, we reported that CMS could achieve billions of dollars in
                     additional savings by more accurately adjusting for differences between
                     MA plans and Medicare FFS providers in the reporting of beneficiary
                     diagnoses. 14 CMS uses this diagnosis data and other information to
                     construct a risk score for each beneficiary. Higher risk scores result in



                     13
                      GAO, Medicare: Use of Preventive Services Could Be Better Aligned with Clinical
                     Recommendations, GAO-12-81 (Washington, D.C.: Jan. 18, 2012).
                     14
                       GAO, Medicare Advantage: CMS Should Improve the Accuracy of Risk Score
                     Adjustments for Diagnostic Coding Practices, GAO-12-51 (Washington, D.C.: Jan 12,
                     2012).




                     Page 5                                                                    GAO-12-719T
increased Medicare payments to plans, while lower risk scores result in
reduced Medicare payments to plans. Risk scores should be the same
among all beneficiaries with the same medical conditions and
demographic characteristics, regardless of whether they are in MA or
Medicare FFS. MA plans have an incentive to code diagnoses more
comprehensively because doing so affects plan payments, which is not
the case in Medicare FFS. CMS is required by law to make an adjustment
to MA risk scores to bring them in line with those of Medicare FFS. In this
report, we found that CMS’s adjustment for diagnostic coding differences
was too small. We estimated that MA beneficiary risk scores in 2010 were
from 4.8 to 7.1 percent higher than they likely would have been if they
had been enrolled in FFS, while CMS’s adjustment for diagnostic coding
differences was only 3.4 percent. Compared to CMS’s analysis, our
analysis incorporated more recent beneficiary data and accounted for
additional beneficiary characteristics that affect risk scores, such as
health status and sex. A revised methodology that incorporated this
information could have saved Medicare between $1.2 billion and
$3.1 billion in 2010 in addition to the $2.7 billion in savings from the
adjustment CMS made. We expect that savings in 2011 and future years
would be even greater. CMS has continued to use its 2010 adjustment
method for 2011 and 2012, even though both we and CMS noted an
upward trend in the impact of coding differences over time. To improve
the accuracy of the adjustment made for differences in coding practices
over time, we recommended that the Secretary of HHS direct the
Administrator of CMS to incorporate the most recent data available in its
estimates; identify and account for all years of diagnostic coding
differences that could affect the payment year for which any adjustment is
made; account for the upward trend of the annual impact of coding
differences in its estimates; and to the extent possible, account for all
relevant differences in beneficiary characteristics between the MA and
Medicare FFS populations. CMS stated that it found our findings
informative, but did not comment on our recommendations.

Canceling the MA Quality Bonus Payment Demonstration. We
recently reported that CMS could achieve billions of dollars in savings by
canceling the MA Quality Bonus Payment Demonstration—which CMS’s
Office of the Actuary has estimated will cost more than $8 billion over




Page 6                                                          GAO-12-719T
                        10 years. 15 Rather than implement the quality bonus payments prescribed
                        in the 2010 Patient Protection and Affordable Care Act (PPACA), as
                        amended, CMS is conducting a nationwide demonstration to test whether
                        a scaled bonus structure would lead to larger and faster annual quality
                        improvement for MA plans at various performance levels. Compared with
                        PPACA’s quality bonus payment system, the demonstration extends the
                        bonuses to average-performing plans, accelerates the phase-in of the
                        bonuses for plans with above-average performance, and increases the
                        size of the bonuses in 2012 and 2013. We found that the demonstration’s
                        estimated $8.35 billion cost offsets more than one-third of PPACA’s MA
                        payment reductions during its 3-year time frame and that most of the
                        additional spending will go to average-performing plans rather than to
                        high-performing plans. The MA Quality Bonus Payment Demonstration
                        dwarfs all other Medicare demonstrations—both mandatory and
                        discretionary—conducted since 1995 in its estimated budgetary impact. It
                        is at least seven times larger than that of any other Medicare
                        demonstration conducted since 1995 and is greater than the combined
                        budgetary impact of all those demonstrations. For a variety of reasons,
                        the design of the demonstration precludes a credible evaluation of its
                        effectiveness in achieving CMS’s stated research goal. We therefore
                        believe that it is unlikely that the demonstration will produce meaningful
                        results. Accordingly, we recommended that the Secretary of HHS cancel
                        the demonstration and allow the MA quality bonus payment system
                        established by PPACA to take effect. HHS did not concur with our
                        recommendation, stating that it believed the demonstration supports a
                        strategy to improve the delivery of health care services, patient health
                        outcomes, and population health.


                        We have conducted a substantial body of work on Medicaid program
Need for Additional     management. Our recommendations have involved a variety of topics and
Oversight of Medicaid   have included different aspects of payment arrangements with states. 16




                        15
                          GAO, Medicare Advantage: Quality Bonus Payment Demonstration Undermined by High
                        Estimated Costs and Design Shortcomings, GAO-12-409R (Washington, D.C.: Mar. 21,
                        2012).
                        16
                         We recently testified about CMS’s oversight of Medicaid program integrity. See GAO,
                        Medicaid: Federal Oversight of Payments and Program Integrity Needs Improvement,
                        GAO-12-674T (Washington, D.C.: Apr. 25, 2012). We also have ongoing work in this area.




                        Page 7                                                                    GAO-12-719T
Improving oversight of supplemental payments. We have reported on
varied financing arrangements involving supplemental payments—
disproportionate share hospital (DSH) payments that states are required
to make to certain hospitals and other non-DSH supplemental
payments—that increase federal funding without a commensurate
increase in state funding. 17 Our work has found that while a variety of
federal legislative and CMS actions have helped curb inappropriate
financing arrangements, gaps in oversight remain. For example, while
there are federal requirements designed to improve transparency and
accountability for state DSH payments, similar requirements are not in
place for non-DSH supplemental payments, which may be increasing.
From 2006 to 2010, state-reported non-DSH supplemental payments
increased from
$6.3 billion to $14 billion; however, according to CMS officials, reporting
was likely incomplete. We made numerous recommendations aimed at
improving oversight of supplemental payments. We have recommended
that CMS adopt transparency requirements for non-DSH supplemental
payments and develop a strategy to ensure that all state supplemental
payment arrangements have been reviewed by CMS. CMS has taken
action to address some of these recommendations, but we continue to
believe additional action is warranted. CMS has raised concern that
congressional action may be necessary to fully address our
recommendations.

Ensuring Medicaid demonstrations do not increase federal liability.
HHS has authority to waive certain statutory provisions to allow states to
implement Medicaid demonstrations that are likely to assist in achieving
program objectives. By policy, these demonstrations should not increase
federal costs. However, we reported in 2008 that HHS had approved two
state Medicaid demonstrations that could increase the federal financial
liability substantially. 18 This report followed earlier work that had identified
similar concerns with HHS approvals of state Medicaid demonstrations
that were not budget neutral. At the time of our work in 2007, HHS
disagreed with our recommendation to improve the demonstration review


17
 GAO, Medicaid: CMS Needs More Information on the Billions of Dollars Spent on
Supplemental Payments, GAO-08-614 (Washington D.C.: May 30, 2008) and GAO,
Medicaid: Ongoing Federal Oversight of Payments to Offset Uncompensated Hospital
Care Costs Is Warranted, GAO-10-69 (Washington D.C.: Nov. 20, 2009).
18
  GAO, Medicaid Demonstration Waivers: Recent HHS Approvals Continue to Raise Cost
and Oversight Concerns, GAO-08-87 (Washington, D.C.: Jan. 31, 2008).




Page 8                                                                  GAO-12-719T
process through steps such as clarifying the criteria for reviewing and
approving states’ proposed spending limits and ensuring that valid
methods were used to demonstrate budget neutrality. Consequently, we
referred this to Congress for consideration. HHS subsequently reported
taking steps, such as monitoring the budget neutrality of ongoing
demonstrations, to improve its oversight. However, no changes are
planned in the methods used to determine budget neutrality of
demonstrations to ensure that demonstrations do not increase the federal
financial liability.

Improving rate-setting methodologies. In August 2010, we reported
that CMS had not ensured that all states were complying with federal
Medicaid requirements that managed care rates be developed in
accordance with actuarial principles, appropriate for the population and
services, and certified by actuaries. 19 For example, we found significant
gaps in CMS’s oversight of 2 of the 26 states reviewed—CMS had not
reviewed one state’s rate setting in multiple years and had not completed
a full review of another state’s rate setting since the actuarial soundness
requirements became effective in August 2002. Variation in practices
across CMS regional offices contributed to these gaps and other
inconsistencies in the agency’s oversight of states’ rate setting. This work
also found that CMS’s efforts to ensure the quality of the data used to set
rates were generally limited to requiring assurances from states and
health plans—efforts that did not provide the agency with enough
information to ensure the quality of the data used. With limited information
on data quality, CMS cannot ensure that states’ managed care rates are
appropriate, which places billions of federal and state dollars at risk for
misspending. We made recommendations to improve CMS’s oversight of
states by implementing a mechanism to track state compliance with
Medicaid managed care actuarial soundness requirements, clarifying
guidance on rate-setting reviews, and making use of information on data
quality in overseeing states’ rate setting. HHS agreed with these
recommendations, and as of May 2012, CMS officials indicated that they
were reviewing and updating the agency’s guidance and exploring the
incorporation of information about data quality into its review and approval
of Medicaid managed care rates.




19
  GAO, Medicaid Managed Care: CMS’s Oversight of States’ Rate Setting Needs
Improvement, GAO-10-810 (Washington, D.C.: Aug. 4, 2010).




Page 9                                                                 GAO-12-719T
                   Improved financial stewardship of federal programs is becoming
Concluding         increasingly important as the pressure to reduce spending mounts. In an
Observations       agency as large as HHS, the need for vigilance in continuously seeking
                   out cost savings cannot be overstated. In our work, we have examined
                   many aspects of HHS operations and made recommendations to help
                   HHS prevent unnecessary spending, save money, recover funds that
                   should rightfully be returned, improve the efficiency of agency operations,
                   and improve service for beneficiaries. HHS has implemented many of our
                   recommendations that have proven to be financially beneficial while also
                   enhancing program management. However, there are still
                   recommendations we have made that remain open. While we recognize
                   that some of the recommendations we have highlighted today are
                   relatively new, others are several years old. HHS has made clear that it is
                   committed to improving the nation’s health and well-being while
                   simultaneously contributing to deficit reduction. We therefore urge HHS to
                   expedite action on our open recommendations to further advance its
                   performance and accountability.


                   Chairman Stearns, Ranking Member DeGette, and Members of the
                   Subcommittee, this completes our prepared statement. We would be
                   pleased to respond to any questions that you may have at this time.


                   If you or your staff have any questions about this testimony, please
GAO Contacts and   contact us at (202) 512-7114 or cosgrovej@gao.gov and
Staff              yocomc@gao.gov. Contact points for our Offices of Congressional
                   Relations and Public Affairs may be found on the last page of this
Acknowledgments    statement. GAO staff who made key contributions to this testimony are
                   listed in appendix I.




                   Page 10                                                         GAO-12-719T
Appendix I: GAO Contacts and Staff
                  Appendix I: GAO Contacts and Staff
                  Acknowledgments



Acknowledgments

                  James Cosgrove, (202) 512-7114 or cosgrovej@gao.gov
GAO Contacts      Carolyn L. Yocom, (202) 512-7114 or yocomc@gao.gov


                  In addition to the contacts named above, Geri Redican-Bigott, Assistant
Staff             Director; Kelly DeMots; Helen Desaulniers; David Grossman; Elizabeth T.
Acknowledgments   Morrison; and Kate Nast made key contributions to this statement.




(291047)
                  Page 11                                                      GAO-12-719T
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