GAO says Medicare program, HCFA should be restructured
GAO says Medicare program, HCFA should be restructured
By MATTHEW HAY
HHBR Washington Correspondent
WASHINGTON While Medicare is an inherently difficult program to manage regardless of how it is structured, the General Accounting Office (GAO, Washington) concluded earlier this month that there are key problems that impair Medicare’s ability to operate more efficiently that can be remedied.
For example, the GAO pointed out that there is no one senior official in the Health Care Financing Administration (HCFA; Baltimore) that is responsible for managing Medicare. Rather, the HCFA Administrator is tasked with overseeing Medicaid and other state programs as well. In addition, continual changes in agency leadership make it difficult to develop and implement a consistent long-term vision, the GAO said.
"Frequent changes in HCFA leadership have inhibited the implementation of long-term Medicare initiatives or the pursuit of a consistent management strategy," said the GAO. As a practical matter, the GAO points out that the maximum term of a HCFA administrator is only as long as the president who appointed them. However, in the 23 years since HCFA’s inception, there have been 17 administrators or acting administrators whose tenure has been little more than a year.
The GAO also pointed out that constraints on HCFA’s ability to acquire appropriate resources and expertise limit the agency’s capacity to modernize Medicare’s existing operations and carry out the program’s growing responsibilities.
"Relative to the size of private health insurers and their administrative budgets, HCFA runs Medicare on a shoestring," the GAO said. "Too great a mismatch between the agency’s administrative capacity and its designated mandate could leave HCFA unprepared to handle Medicare’s future population growth and medical technology advances."
The GAO also noted that Congress recently added an array of new tasks to HCFA’s existing responsibilities through the Balanced Budget Act of 1997 (BBA), which tasked HCFA with implementing 335 provisions, as well as the Balanced Budget Refinement Act of 1999 (BBRA), which added another 133 provisions.
The GAO added that HCFA was overwhelmed by the range of new options afforded Medicare beneficiaries including health maintenance organizations, preferred provider organizations, private fee-for-service plans, and medical savings accounts.
The GAO said that several recent Medicare reform proposals, such as Breaux-Frist, recognize that HCFA must be modernized in order to meet the financing challenges brought about by an aging population and increasingly expensive medical technology. But the GAO concluded that no single proposal offers a complete solution.
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