Does the program demonstrate improved efficiencies or cost effectiveness in achieving program performance goals each year?
Explanation: Medicare has made strides to achieve its goals, but work remains in some key areas. On the benefits side numerous observers (including the GAO and the IG) and Medicare’s current leadership acknowledge that payment for Part B-covered drugs is inefficient and inappropriate when compared to the acquisition cost of these drugs and comparable payment in the private sector. Similar concerns exist with respect to Durable Medical Equipment (DME). On the administrative side, the erroneous payment rate has been reduced from 1996 levels, but Medicare has not achieved its annual target since 2000. On cost per claim, electronic processing yielded major efficiencies in the 1990s, but costs for some claims have been increasing in recent years. Evidence: For information on Part B drugs, see, for example, GAO-02-833T and GAO-02-531T. Payment error rates were computed by the OIG at 6.3% for FY 2002 compared to 14% in FY 1996; the target rate, however, is 5%. Electronic claims now make up 98
