Use of Competitive Contracts for Consultative Medical Exams Can Save Millions
HRD-90-141: Published: Aug 17, 1990. Publicly Released: Aug 17, 1990.
GAO reviewed state disability determination services' (DDS) procurement of consultative medical examinations (CE) of claimants seeking benefits under the Social Security Administration's (SSA) disability programs.
GAO found that: (1) New York's DDS expects to save $8.6 million over the 3-year life of its contracts; (2) Oregon's DDS expects to save about $1.6 million through 1993; (3) for the 3-year period ending September 30, 1989, cost savings for Oregon and New York were 14 and 15 percent, respectively, of their CE expenditures; (4) DDS said that savings from competitive contracting were realized with minimal administrative costs; (5) New York contracted because it was faced with an increasing number of volume providers on its CE panel; (6) Oregon contracted because of its need to gain control over escalating medical costs; (7) Oregon and New York DDS officials said that the use of competitively awarded contracts resulted in improved overall CE quality; and (8) to decide whether to contract competitively for CE, DDS needs to evaluate their individual circumstances.