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1992.03.06 :  Medicare Electronic Filing

Contact:   Bob Hardy (202) 245-6145
March 6, 1992

        HHS Secretary Louis W. Sullivan, M.D., announced today that
the Office of Management and Budget has released $68.8 million in
contingency funds for the Health Care Financing Administration,
including funds to keep toll-free phone lines open for Medicare
beneficiaries and support for electronic filing of claims.
        HCFA, which directs the Medicare and Medicaid programs,
requested the funds from OMB after determining a shortfall existed
for fiscal year 1992, ending Sept. 30.  The agency's request
followed a HCFA review of total funding available for Medicare
contractors.   
        "HCFA will take immediate action to release the funds to
the contractors," Secretary Sullivan said. "I am especially pleased
that Medicare beneficiary toll-free lines will be maintained.  The
additional funds also will allow the federal government to recover
more than $600 million in Medicare benefit payments that would
otherwise be lost."
        Contingency funding of $22 million will be paid to
contractors to continue providing toll-free phone service to
beneficiaries.
        A total of $19.9 million in funding will be used to reduce
a backlog of cases and recover money owed to the federal government
for health-benefit claims that should have been paid by employer
health plans, instead of Medicare. With the additional outlay,
HCFA expects to recoup $613 million in improper benefit payments.
In general, Medicare is the secondary payer when an employed
Medicare beneficiary or spouse is covered by an employer health
plan. 
        A central computer system in HCFA will process the
information reported by employers on the health coverage for 8.9
million employed Medicare beneficiaries or their spouses.  The
workers have been identified in a computer match of data from
Medicare, the Social Security Administration and the Internal
Revenue Service, under authorization given by the Omnibus Budget
Reconciliation Act of 1989. 
        In another category, $20 million of the contingency funding
will be used to expand efforts to encourage providers to file
claims electronically to Medicare contractors.
        "Historically, electronic claims show a savings of 50 cents
per claim over the processing of paper claims," said HCFA
Administrator Gail R. Wilensky, Ph.D.  "The new higher level of
electronic processing will result in a $65 million reduction in
operating costs in 1993." 


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