1993.02.19 : Medicare Program Costs in 1992 Contact: Anne Verano (202) 690-6145 February 19, 1993 The Medicare program covered 35.6 million elderly and disabled Americans in fiscal year 1992 at a cost of $132.3 billion, an increase of more than 13 percent from the FY 1991 level. Medicare payments for health care services in FY 1992 amounted to $129.2 billion -- an increase of 13.4 percent -- while administrative costs were $2.9 billion, or about two percent of total Medicare outlays. William Toby Jr., acting administrator of the Health Care Financing Administration, said that "rapid advances in the proportion of claims that are submitted and processed electronically contribute to significant savings in administrative costs." Funding for Peer Review Organizations, which monitor the quality of care and utilization of services received by Medicare beneficiaries, totaled $230 million in FY 1992. Medicare expenditures are affected by the same factors that are causing national health expenditures to increase at a rate of more than 11 percent a year. Major components of the rise in health care costs include inflation, population growth, and increases in the volume and intensity of services. The inflation rate for health care services -- as measured by the Consumer Price Index -- was 7.2 percent, more than double the 3.1 percent rate of increase for all consumer prices. While the number of Medicare beneficiaries increased 1.7 percent, the volume of claims grew 11.5 percent to reach 660 million. Health care providers submitted an average of 19 claims per Medicare beneficiary, up from 17 claims per beneficiary in FY *This is an archive page. The links are no longer being updated. 1991. Medicare benefit payments for services to each beneficiary amounted to $3,624 in FY 1992, an increase of 11.5 percent from the $3,251 per-capita sum in the previous year. Toby said that "substantial Medicare cost savings will be achieved by more effective claims review procedures that we are implementing." He also said that a special unit has been created in the HCFA Bureau of Program Operations to detect fraud, and he described another HCFA initiative in which four regional contractors will specialize in processing claims for durable medical equipment. ### EDITOR'S NOTE: HCFA, an agency of the U.S. Department of Health and Human Services, directs the Medicare and Medicaid programs, which help pay the medical bills of 67 million Americans. HCFA's estimated fiscal year 1993 expenditures are $230 billion, the 12th largest government budget of any kind in the world. Medicare Benefit Payments Enrollees ($ in thousands) September September FY 1991 FY 1992 1991 1992 Alabama $1,851,526 $2,100,140 596,112 606,983 Alaska 84,788 81,727 26,856 28,279 Arizona 1,824,262 2,076,849 514,886 534,067 Arkansas 1,091,343 1,309,391 398,626 404,687 California 13,239,877 15,652,577 3,380,146 3,434,524 Colorado 1,073,159 1,242,210 371,374 383,560 Connecticut 1,588,476 1,953,460 479,280 485,299 Delaware 267,575 266,962 90,921 93,120 D.C. 1,001,486 1,112,051 78,733 78,441 Florida 8,890,316 10,361,327 2,390,950 2,447,906 Georgia 2,384,056 2,864,106 752,494 771,347 Hawaii 392,871 404,329 132,317 136,507 Idaho 259,409 299,869 135,929 139,119 Illinois 4,876,750 5,564,774 1,563,350 1,579,230 Indiana 2,296,799 2,454,767 779,129 790,985 Iowa 1,103,854 1,241,751 463,015 466,860 Kansas 1,010,293 1,160,503 369,649 373,408 Kentucky 1,626,674 1,787,513 545,790 555,198 Louisiana 2,061,280 2,318,049 543,871 553,299 Maine 452,145 513,553 187,142 190,932 Maryland 2,007,972 2,262,085 556,981 567,667 Massachusetts 3,415,757 3,779,672 885,223 897,540 Michigan 4,307,613 4,641,997 1,266,310 1,287,741 Minnesota 1,833,201 1,942,733 599,574 608,201 Mississippi 968,197 1,234,661 373,027 378,257 Missouri 2,660,202 2,673,985 795,104 805,024 Montana 298,160 307,276 120,578 123,008 Nebraska 593,200 631,275 240,745 242,929 Nevada 524,310 598,224 149,673 159,164 New Hampshire 356,804 428,024 141,374 145,018 New Jersey 3,559,396 4,188,080 1,116,485 1,130,236 New Mexico 443,693 489,277 186,635 192,341 New York 9,554,509 10,268,609 2,555,153 2,573,080 North Carolina 2,415,745 3,005,797 921,050 945,314 North Dakota 315,476 352,161 100,227 101,123 Ohio 5,316,718 5,720,970 1,579,631 1,603,389 Oklahoma 1,264,928 1,471,347 460,018 466,655 Oregon 1,215,225 1,356,953 434,389 443,961 Pennsylvania 7,414,626 8,365,352 1,994,704 2,019,052 Rhode Island 504,033 587,786 161,521 163,602 South Carolina 977,015 1,243,924 456,148 468,267 South Dakota 268,691 275,842 112,050 113,217 Tennessee 2,406,350 2,894,511 709,134 722,847 Texas 6,217,049 6,978,035 1,882,806 1,925,526 Utah 427,096 426,940 166,235 171,434 Vermont 169,704 200,092 76,345 77,785 Virginia 1,918,016 2,226,413 744,056 760,930 Washington 1,887,315 2,145,409 632,132 645,448 West Virginia 798,547 931,431 314,243 317,683 Wisconsin 1,919,212 2,125,566 726,153 735,709 Wyoming 98,833 97,803 53,796 55,326 Guam 3,646 3,120 2,734 2,876 Puerto Rico 501,384 555,523 438,647 446,172 Virgin Islands 1,622 1,458 7,776 8,031 Other 1,136 832 284,849 290,869 TOTAL $113,942,424 $129,179,077 35,045,865 35,649,173