Department of Health and Human Services 
OFFICE OF 
INSPECTOR GENERAL 
Y2K Readiness of Managed Care 
Organizations as of July 1999 
JUNE GIBBS BROWN 
Inspector General 
OCTOBER 1999 
OEI-05-98-00591  OFFICE OF INSPECTOR GENERAL 
The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452, is to 
protect the integrity of the Department of Health and Human Services programs as well as the 
health and welfare of beneficiaries served by them.  This statutory mission is carried out through a 
nationwide program of audits, investigations, inspections, sanctions, and fraud alerts.  The 
Inspector General informs the Secretary of program and management problems and recommends 
legislative, regulatory, and operational approaches to correct them. 
Office of Evaluation and Inspections 
The Office of Evaluation and Inspections (OEI) is one of several components of the Office of 
Inspector General.  It conducts short-term management and program evaluations (called 
inspections) that focus on issues of concern to the Department, the Congress, and the public.  The 
inspection reports provide findings and recommendations on the efficiency, vulnerability, and 
effectiveness of departmental programs. 
OEI's Chicago Regional Office  prepared this report under the direction of William C. Moran, 
Regional Inspector General and Natalie Coen, Deputy Regional Inspector General.  Principal OEI 
staff included: 
REGION  HEADQUARTERS 
Thomas Komaniecki, Project Leader  Elise Stein, Program Specialist

Nora Leibowitz

Susan Otter

To obtain copies of this report, please call the Chicago Regional Office at (312) 353-4124. 
Reports are also available on the World Wide Web at our home page address: 
http://www.dhhs.gov/progorg/oei  E X E C U T I V E  S U M M A R Y  
PURPOSE 
To examine the current Year 2000 (Y2K) readiness of Medicare managed care 
organizations and provide follow-up information for the Health Care Financing 
Administration. 
BACKGROUND 
The Y2K problem stems from the way computers have traditionally stored dates through 
the use of an implied century.  To save computer storage space, programmers used only 
two digits, rather than four, in year date fields.  The Health Care Financing Administration 
(HCFA) has made remedying the Y2K problem its number one priority. 
Some of the key computer systems at risk among healthcare providers that could affect 
the 7 million Medicare beneficiaries enrolled in managed care are:  premium billing 
systems, medical information systems, member enrollment systems, member verification 
systems and provider payment systems.  Failure of these systems to correctly process data 
could negatively impact access to care and service delivery. 
The Office of Inspector General (OIG) conducted an initial survey on Medicare managed 
care organizations (MCOs) in January and February of 1999.  The results of this survey 
can be found in a report entitled Y2K Readiness of Managed Care Organizations, OEI-
05-98-00590.  The Congress and HCFA requested that we conduct a follow-up survey. 
The OIG also conducted surveys of various medical provider types.  These results can be 
found in a report entitled Y2K Readiness of Medicare Providers, OEI-03-98-00250.  The 
OIG also conducted follow-up surveys of these providers.  The results of these surveys 
can be found in an OIG report entitled Y2K Readiness of Medicare Fee-for-Service 
Providers as of July 1999, OEI-03-98-00253. 
We received follow-up surveys from 161 MCO contracts in July and August of 1999.  The 
data was self-reported by MCOs and was not verified.  Not all MCOs were surveyed due 
to site visits by HCFA.  The HCFA conducted 59 site visits representing 204 managed 
care plans.  We have reviewed this data as a complement to the survey we conducted. 
1 
MCO Y2K Follow-up  OEI-05-98-00591  FINDINGS 
Over four-fifths of managed care organizations report that their systems are Y2K 
compliant 
Overall, 85 percent of MCO respondents claim that they are currently Y2K ready. 
Approximately 9 percent of these MCOs have not yet completed testing their systems.  An 
MCO is considered to have overall Y2K compliance if it reported that all applicable 
systems are Y2K ready.  Ninety-four percent of MCOs report that vendor-supported 
products, such as hardware,  telecommunications and embedded processors, are 
compliant.  Almost all MCOs have established recommended infrastructures in preparation 
for Y2K testing but most have not contracted out for independent assessment of Y2K 
readiness. 
About one-half indicate that they are taking steps toward ensuring compliance 
with external partners 
Fifty-six percent of MCOs report receiving commitments from relevant data exchange 
partners to participate in end-to-end testing.  Nine percent of MCOs felt such 
commitments were not applicable.  Fifty percent of MCOs have tested exchanging data 
with their subcontractors systems, and 35 percent of MCOs have tested exchanging data 
with their medical providers systems. 
Approximately 80 percent report developing contingency plans; about 30 percent 
report testing their contingency plans 
Comparing the current survey to our previous study, we found an increase of 5 to 10 
percent of MCOs reporting that they have developed contingency plans related to specific 
computer systems.  Currently, 83 percent of MCOs report developing a contingency 
strategy for their membership enrollment systems, and 79 percent of MCOs report 
developing a strategy for their premium billing systems.  Seventy-three percent report 
developing a contingency plan for their medical information systems.  As of July 1999, 28 
percent of MCOs report having tested contingency plans, compared to only 8 percent as 
of February 1999. 
The HCFA required MCOs to submit contingency plans for review.  The contingency 
plans were reviewed for content and feasibility of implementation.  Based on their analysis, 
HCFA determined that 33 percent of the contingency plans submitted as of August 1999 
required little or no modification, while 67 percent needed major or complete revision. 
2 
MCO Y2K Follow-up  OEI-05-98-00591  AGENCY COMMENTS 
We received comments from the Health Care Financing Administration.  Their comments 
are included as Appendix B.  We appreciate HCFAs cooperation in developing our 
survey and sharing the results of their on-site Y2K reviews of managed care organizations. 
We commend HCFAs continued focus on readiness in light of the results of their on-site 
visits, their review of contingency plans, and our survey results. 
3 
MCO Y2K Follow-up  OEI-05-98-00591  T A B L E   O F   C O N T E N T S  
PAGE

EXECUTIVE SUMMARY  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  1

INTRODUCTION  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  5

FINDINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  10

Internal Y2K Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  10

External Partners Testing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  11

Contingency Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  11

AGENCY COMMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  13

APPENDIX

Survey Results . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  14

Agency Comments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  19

4 
MCO Y2K Follow-up  OEI-05-98-00591  I N T R O D U C T I O N   
Purpose 
To examine the current Year 2000 (Y2K) readiness of Medicare managed care 
organizations and provide follow-up information for the Health Care Financing 
Administration. 
Background 
The Office of Inspector General (OIG) conducted a number of surveys examining the 
Year 2000 (Y2K) readiness of the health care industry.  Among the areas of the health 
care industry surveyed by the OIG were Medicare managed care organizations (MCOs). 
The results of this survey can be found in a report entitled Y2K Readiness of Managed 
Care Organizations, OEI-05-98-00590.  The Congress, along with the Health Care 
Financing Administration (HCFA), requested that we conduct a follow-up survey 
examining the current Y2K readiness of MCOs. 
The Y2K problem stems from the way computers have traditionally stored dates through 
the use of an implied century.  To save memory and storage space, programmers have 
conventionally used only two digits, rather than four, in year date fields.  When the 
calendar flips over to January 1, 2000, many computer systems will recognize the year 
00" as 1900 and applications will either stop running or produce unpredictable results. 
Computer systems that are not Y2K compliant simply will not be able to recognize dates 
occurring after 1999 (e.g., 01" will be recognized as 1901 rather than 2001).  These 
computer systems will not be able to process date and time sensitive data from one 
century into another or between centuries. 
Though perhaps not as complex or problematic as government program systems, MCOs 
are considered vulnerable to Y2K problems due to the myriad business systems they 
operate.  These are systems that are crucial to the ongoing interface necessary to 
communicate with corporate and government payer sources and accounts-payable 
balances with physicians, hospitals, and other medical and non-medical providers and 
subcontractors. 
Some of the key computer systems at risk among healthcare providers that could affect 
the 7 million Medicare beneficiaries enrolled in managed care are:  premium billing 
systems, medical information systems, member enrollment systems, member verification 
systems and provider payment systems.  Failure of these systems to correctly process data 
could negatively impact beneficiary access to care, service delivery and efficient Medicare 
reimbursement. 
5 
MCO Y2K Follow-up  OEI-05-98-00591  Meeting the Y2K Challenge 
The HCFA has made the Y2K initiative its number one priority and is committed to 
making sure that its date-sensitive systems and those of its business partners are ready to 
verify eligibility, enrollment, coverage and payment.  The HCFA defines Y2K compliant 
as: 
...information technology that accurately processes date/time data 
(including, but not limited to, calculating, comparing, and 
sequencing) from, into, and between the nineteenth, twentieth and 
twenty-first centuries, and the years 1999 and 2000 and leap year 
calculations.  Furthermore, Year 2000 compliant information 
technology, when used in combination with other information 
technology, shall accurately process date/time data if the other 
information technology properly exchanges date/time data with it. 
Meeting the Y2K challenge requires identifying, renovating and testing all computer and

information systems to assure the transition from a six-digit date (12/31/99) to an eight-

digit date (12/31/1999) by January 1, 2000.  Some examples of critical dates include:

<  the date a beneficiary became eligible for Medicare, 

<  the date a patient was admitted or discharged from a hospital, 

<  the date a wheelchair rental began, and

<  the date an enrollee entered a Medicare managed care plan. 

A trouble-free transition into the new millennium is key to meeting the needs of Medicare

beneficiaries and providers.  At stake are efficient reimbursement and beneficiaries access

to, and the timeliness and quality of, health care.  The HCFA advises its contracting

MCOs to review the Government Accounting Office (GAO) Assessment Guide as an aid

to becoming Y2K compliant.  The HCFA advocates using the following five proactive

steps to identify and address potential impacts presented by the Year 2000 challenge: 

1.	 Awareness - inventory all hardware and software systems on the potential Y2K 
impact. 
2.	 Assessment - determine the Y2K readiness of these systems for operation beyond 
12/31/99. 
3.	 Renovation - update or replace systems and software programs as needed to 
ensure operations will be Y2K ready. 
4.	 Testing - test existing and newly purchased systems and software to verify they 
work. 
5.	 Contingency Planning - develop business contingency plans for operations 
beyond 12/31/99, just in case something goes wrong. 
6 
MCO Y2K Follow-up  OEI-05-98-00591  Managed Care Organizations Millennium Compliance Responsibilities 
The HCFA has requested its managed care organizations make Y2K compliance a top 
priority.  The HCFA has advised MCOs to assess the following business components: 
<  Applications (including cross-business applications and all external interfaces). 
<  Databases. 
<  Computer Infrastructure (including hardware, system software, 
telecommunications, and date dependent functions such as passwords, accounts 
and software licenses). 
<  Non-Information Technology Systems (including physical plant security, card entry 
systems, elevator systems, environmental control systems). 
In a Managed Care Millennium Compliance Letter dated September 17, 1998, HCFA 
delineates the following Year 2000 compliant responsibilities for its contracting MCOs: 
<	 Complying with the enrollment and payment data exchange processes requirements 
as outlined in HCFAs Operational Policy Letter 98.068.  (In essence, MCOs are 
to update all date/time fields in the record layouts of the Enrollment and 
Disenrollment Transaction and the Transaction Reply/Monthly Activity Report 
Data Format to record a four digit year.) 
<	 Clearly defining all internal and external systems and interfaces requiring 
compliance (membership systems, claims systems, medical record systems, 
pharmacy and lab systems, exchanges between delegated groups, etc.). 
<  Performing a thorough risk assessment. 
<  Identifying all involved parties and entities with whom data is exchanged and 
assuring that the defined requirements are clearly understood by these parties. 
<  Ensuring that providers, suppliers, and beneficiaries are aware of the Y2K 
compliant issues and problems that may arise. 
<  Communicating with trading partners with whom there is a data exchange to 
assure that they are taking the appropriate measures toward Y2K compliance. 
<  Developing implementation plans and testing schedules. 
<  Performing extensive testing. 
<  Developing an extensive contingency plan. 
In addition to the above responsibilities, HCFA requires MCOs to:  (1)  ...certify that 
they understand HCFAs Y2K compliant definition and have tested all of their data 
systems/interfaces to ensure Y2K compliance, and (2) ...have a contingency plan in 
place in the event that internal organization or key external business partner systems fail. 
The HCFA required MCOs to certify their Y2K compliance by April 15, 1999. 
7 
MCO Y2K Follow-up  OEI-05-98-00591  Ongoing HCFA efforts 
In addition to having MCOs certify their Y2K compliance, HCFA is monitoring the 
contingency planning efforts of MCOs.  The HCFA required all MCOs to submit their 
contingency plans to HCFA by July 15, 1999.  The MCOs are also required to report on a 
monthly basis the status of validating their contingency plans. 
With the help of a technical support contractor, HCFA conducted 59 site reviews covering 
204 MCOs.  From July through mid-September 1999, HCFA visited national managed 
care organizations and those organizations that have more than 50,000 enrolled Medicare 
beneficiaries.  The HCFA also included a number of small plans as part of its site reviews. 
The site visits were conducted to evaluate the completeness of the planned Y2K 
preparations, associated schedules, quality control efforts, configuration management 
disciplines, renovations and contingency planning that pertain to the MCOs. 
Other Office of Inspector General Work 
The Office of Inspector General has also conducted surveys of hospitals, nursing homes, 
home health agencies, durable medical equipment suppliers and physicians to examine the 
Y2K readiness of these providers.  The results of these surveys can be found in an OIG 
report entitled Y2K Readiness of Medicare Providers, OEI-03-98-00250.  The OIG also 
conducted follow-up surveys of these providers.  The results of these surveys can be 
found in an OIG report entitled Y2K Readiness of Medicare Fee-for-Service Providers as 
of July 1999, OEI-03-98-00253. 
METHODOLOGY 
The purpose of this inspection was to gather information from managed care organizations 
regarding their Y2K readiness.  We developed our survey instrument in cooperation with 
the Health Care Financing Administration and timed our survey to coincide with HCFAs 
site visits.  Based on discussions with HCFA, we did not survey those MCOs scheduled 
for a site review by HCFA. 
The surveys were sent by overnight mail to the MCOs on June 28, 1999.  We sent a 
postcard to the MCOs reminding them of our survey on July 12, 1999.  Our deadline for 
returning the surveys was July 23, 1999.  We contacted those MCOs that did not respond 
initially to our survey.  We included surveys from all MCOs that responded before the end 
of the first week in August. 
We received a list of managed care contract numbers from HCFA.  In addition, HCFA 
provided a list of MCOs scheduled for site review.  We did not survey those MCOs 
8 
MCO Y2K Follow-up  OEI-05-98-00591  scheduled for a HCFA site review.  After removing these MCOs, our list contained 235 MCOs. 
Nine contracts did not have sufficient information to be delivered through overnight mail. 
An additional 17 MCOs provided us with information that they were not renewing their 
Medicare contract for calender year 2000.  We did not require these MCOs to respond to 
our survey.  An additional 60 MCOs informed us that their plans were scheduled for a site 
visit by HCFA and therefore should not have received the survey.  This left us expecting 
responses from 149 MCOs. 
We received responses from 161 MCOs.  We received 144 surveys from the group of 149 
MCOs from whom we were expecting responses, a 97 percent response rate for this 
group.  In addition, we received survey responses from 17 valid MCO contracts that were 
not on the original list provided by HCFA.  In some cases, the responses were from MCOs 
with multiple contracts of which some were on the original list.  In other cases, MCOs 
sent us survey responses based on information provided by the American Association of 
Health Plans through their web site which featured a copy of our survey.  Using 
information from our previous MCO survey, we determined that 88 additional MCOs 
potentially should have been included in our June 28, 1999 mailing.  The 88 additional 
MCOs, along with the 149 original expected responses, constitute the total population of 
MCOs not subject to HCFA site visits.  Our study reflects the responses of 68 percent of 
these MCOs. 
We asked the MCOs whether they had conducted tests of their systems for Year 2000 
readiness.  We allowed respondents to use their own definitions for testing based on 
industry standards. 
We have included, as Appendix A, a copy of the questionnaire that we used along with the 
overall survey results. 
Scope 
The data analyzed in this report was furnished by MCOs and was not verified for 
accuracy.  The survey did not measure the quality of MCOs testing or contingency plan 
development.  This data represents only those MCOs that were surveyed and does not 
include MCOs that were scheduled for a site visit by HCFA.  The HCFA conducted 59 
site visits representing 204 managed care plans.  We have reviewed this data as a 
complement to the survey we conducted. 
We conducted our review in accordance with the Quality Standards for Inspections issued 
by the Presidents Council on Integrity and Efficiency. 
9 
MCO Y2K Follow-up  OEI-05-98-00591  F I N D I N G S  
Over four-fifths of managed care organizations report that all 
of their systems are Y2K compliant 
Overall, 85 percent of MCO respondents claim that they are currently Y2K ready.  About 
9 percent of these MCOs have not yet completed testing for their systems.  An MCO is 
considered to have overall Y2K compliance if it reported that all applicable systems are 
Y2K ready.  Our previous survey revealed that 22 percent of MCOs reported that their 
computer systems were Y2K ready.  On average, 82 percent of MCOs reported Y2K 
compliance for individual computer systems.  See Table 1 for more information. 
Table 1: Majority of MCOs Report Their Individual Computer Systems Y2K 
Compliant 
Systems  Y2K Ready  Not Y2K Ready  Not Applicable 
Provider Payment  86%  6%  3% 
Systems 
Member Enrollment  84%  7%  3% 
Systems 
Premium Billing  83%  5%  8% 
Systems 
Member Verification  81%  6%  7% 
Systems 
Medical Information  75%  6%  13% 
Systems 
OIG MCO Survey, 1999 
Almost all MCOs respondents report having ensured that vendor-supported 
systems are Y2K compliant 
Ninety-four percent of MCOs report that vendor-supported products, such as hardware, 
telecommunications and embedded processors, are compliant.  Of those who reported 
ensuring vendor-supported products are compliant, 99 percent have established an 
inventory of vendor-supported products, 87 percent have obtained vendor Y2K 
10 
MCO Y2K Follow-up  OEI-05-98-00591  certifications, and 79 percent have taken steps to validate vendors claims of Y2K 
compliance. 
Almost all MCOs report having established recommended infrastructures in 
preparation for Y2K testing but most have not contracted out for independent 
assessment of Y2K readiness 
Ninety-six percent have formally assigned Y2K responsibility to a single program or 
project office.  Ninety-seven percent of MCOs have defined Y2K compliance.  Ninety-
three percent have developed an organizational Y2K test and evaluation master plan, and 
83 percent have established test facilities to allow Y2K testing.  The GAO recommends 
that businesses set up these specific infrastructures to assist in Y2K compliance planning 
and testing. 
Only 35 percent have contracted with an outside organization for an independent 
verification and validation assessment of Y2K readiness.  The HCFA strongly 
recommends MCOs follow this course of action to ensure Y2K compliance. 
About one-half of managed care organizations indicate that 
they are taking steps toward ensuring compliance with 
external partners 
Fifty-six percent of MCOs report having received commitments from relevant data 
exchange partners to participate in end-to-end testing.  Nine percent of MCOs felt such 
commitments were not applicable.  Fifty percent of MCOs have tested exchanging data 
with their subcontractors systems and 35 percent of MCOs have tested exchanging data 
with their medical providers systems.  Our previous study found that less than one quarter 
of MCOs had tested data exchanges with two thirds or more of these business partners. 
Approximately 80 percent report developing contingency 
plans; about 30 percent report testing their contingency 
plans 
Comparing the current survey to our previous study, we found an increase of 5 to 10 
percent of MCOs reporting that they have developed contingency plans related to specific 
computer systems.  On average, 78 percent of MCOs report developing contingency plans 
compared to an average of 71 percent previously. See Figure 1 for more information. 
11 
MCO Y2K Follow-up  OEI-05-98-00591  Figure 1: Contingency Plan Development: MCOs Report Progress 
OIG MCO Survey, 1999 
Currently, 28 percent of all MCO respondents report having tested contingency plans, 
compared to only 8 percent from the previous survey.  According to HCFA and GAO, 
contingency planning and testing contingency plans are important aspects of every Year 
2000 conversion program. 
The HCFA required MCOs to submit contingency plans for review.  The contingency 
plans were reviewed for content and feasibility of implementation.  As of August 30, 1999, 
HCFA received 145 contingency plans representing 262 MCO contracts.  Based on their 
analysis, HCFA determined that 33 percent of the contingency plans required little or no 
modification, while 67 percent needed major or complete revision. 
12 
MCO Y2K Follow-up  OEI-05-98-00591  A G E N C Y  C O M M E N T S  
We received comments from the Health Care Financing Administration.  Their comments 
are included as Appendix B.  We appreciate HCFAs cooperation in developing our 
survey and sharing the results of their on-site Y2K reviews of managed care organizations. 
We commend HCFAs continued focus on readiness in light of the results of their on-site 
visits, their review of contingency plans, and our survey results. 
13 
MCO Y2K Follow-up  OEI-05-98-00591  APPENDIX A 
Medicare Managed Care Organization Year 2000 Survey 
Testing Infrastructure
 Yes  No  Not  Unknown 
Applicable 
1.  Has your organization formally assigned Year 2000 test management 
authority and responsibility to a single program or project office? 
N=161  96% 4%  0%  0% 
2.	 Has your organization defined what Year 2000 compliance means? 
If No skip to Question 3, otherwise does the definition include the 
following items? 
N=157  97% 3%  0%  0% 
A.  No value for current date will cause any interruption in 
system operation. 
N=146  93% 3%  1%  3% 
B.  Date-based system functionality must behave consistently 
for dates prior to, during and after Year 2000. 
N=148 
99% 0%  1%  1% 
C.  In all system interfaces and data storage areas, the century 
in any date must be specified either explicitly or by 
unambiguous algorithms. 
N=146  94% 3%  1%  3% 
D.  Systems recognize Year 2000 as a leap year. 
N=145  98% 1%  0%  1% 
3.	 Has your organization developed an organizational Year 2000 test 
and evaluation master plan? 
N=160  93% 6%  1%  0% 
4.	 Has your organization established one or more test facilities that 
replicate the operating environment(s) to allow Year 2000 tests? 
N=161 
83%  13%  3%  1% 
5.	 Has your organization ensured that vendor-supported products (i.e. 
hardware, systems, software, telecommunications, and embedded 
processors) are compliant? If No skip to question 6, otherwise has 
your organization completed the following? 
N=160  94% 6%  0%  0% 
14 
MCO Y2K Follow-up  OEI-05-98-00591   Yes  No  Not  Unknown 
Applicable 
A.	 Has an inventory of vendor-supported products been 
established? 
N=149  99%  1%  0%  0% 
B.  Have vendor certifications been obtained? 
N=149  87%  12%  0%  1% 
C.  Have steps been taken to validate vendors claims? 
N=149  79%  20%  0%  1% 
6.  Has your organization contracted with an outside organization for an 
independent verification and validation assessment of your 
organizations Y2K readiness? 
N=161  35%  62%  1%  1% 
Computer Systems Testing 
7.  Has your organization tested its enrollment system to ensure that it 
accurately processes date and time data (e.g. calculating, comparing 
and sequencing) for the years 1999 and 2000, and leap year 
calculations? 
N=161  77%  20%  3%  0% 
8.  Has your organization tested its membership verification system to 
ensure that it accurately processes date and time data (e.g. 
calculating, comparing and sequencing) for the years 1999 and 
2000, and leap year calculations? 
N=161  76%  19%  5%  0% 
9.  Has your organization tested its medical information systems to 
ensure that it accurately processes date and time data (e.g. 
calculating, comparing and sequencing) for the years 1999 and 
2000, and leap year calculations? 
N=160  71%  17%  13%  0% 
10.  Has your organization tested its premium billing systems to ensure 
that it accurately processes date and time data (e.g. calculating, 
comparing and sequencing) for the years 1999 and 2000, and leap 
year calculations? 
N=160  76%  16%  8%  0% 
15 
MCO Y2K Follow-up  OEI-05-98-00591   Yes  No  Not  Unknown 
Applicable 
11.	 Has your organization tested its provider payment systems to ensure 
that it accurately processes date and time data (e.g. calculating, 
comparing and sequencing) for the years 1999 and 2000, and leap 
year calculations? 
N=161  78%  17%  4%  1% 
12.	 Has your organization tested its appeal and grievance systems to 
ensure that it accurately processes date and time data (e.g. 
calculating, comparing and sequencing) for the years 1999 and 
2000, and leap year calculations? 
N=160  59%  12%  27%  3% 
13.  Is your organizations member enrollment system Y2K compliant? 
N=160 
84% 7%  3%  6% 
14.  Is your organizations member verification system Y2K compliant? 
N=160 
81% 6%  7%  7% 
15.  Is your organizations medical information system Y2K compliant? 
N=160 
75%  6%  13%  6% 
16.  Is your organizations premium billing system Y2K compliant? 
N=160  83%  5%  8%  4% 
17.  Is your organizations provider payment system Y2K compliant? 
N=160  86%  6%  3%  6% 
18.  Is your organizations appeal and grievance system Y2K compliant? 
N=161 
67%  4%  25%  4% 
19.	 Have your relevant data exchange partners committed to 
participating in end-to-end testing? 
N=160  56%  24%  9%  11% 
16 
MCO Y2K Follow-up  OEI-05-98-00591   Yes  No  Not  Unknown 
Applicable 
20.	 Has your organization tested exchanging data between your system 
and your medical providers systems? 
N=161  35%  39%  25%  2% 
21.	 Has your organization tested exchanging data between your system 
and your subcontractors systems? 
N=161  50%  30%  17%  2% 
Contingency Plans 
22.	 Have you developed a contingency strategy for dealing with potential 
Y2K-related problems associated with your: 
A.  membership enrollment/disenrollment systems? 
N=159  83%  15%  3%  0% 
B.  medical information systems (e.g. patient files, utilization)? 
N=160  73%  14%  13%  1% 
C.  premium billing systems? 
N=160  79%  13%  8%  1% 
D.  provider payment systems? 
N=160  81%  13%  6%  0% 
E.  member appeal/grievance systems? 
N=161  67%  14%  18%  1% 
23.  Have you tested your contingency plans? 
N=159  28%  70%  2%  0% 
Other Information 
24.	 Will your organization require that your medical providers 
demonstrate that their systems are Y2K compliant? 
N=158  42%  49%  4%  5% 
17 
MCO Y2K Follow-up  OEI-05-98-00591   Yes  No  Not  Unknown 
Applicable 
25.	 What percent of your medical providers have demonstrated that their 
computer systems are Y2K compliant? 
N=66  Average=39% 
26.	 Will your organization require that subcontractors demonstrate that 
their computer systems are Y2K compliant? 
N=159  65%  22%  9%  4% 
27.	 What percent of your subcontractors have demonstrated that their 
computer systems are Y2K compliant? 
N=103  Average=72% 
28.	 Can your plan continue to provide services to patients if Medicare 
payments were delayed? 
N=161  79%  10%  7%  4% 
If Yes, for how long?  ________days/weeks/months 
(Please circle appropriate unit) 
N=112  Average=2 months 
Please use the space below to list any of your Y2K concerns that were not covered in this 
survey or anything that the Medicare program could do to improve Y2K outreach efforts. 
18 
MCO Y2K Follow-up  OEI-05-98-00591  APPENDIX B 
Agency Comments

19 
MCO Y2K Follow-up  OEI-05-98-00591  20 
MCO Y2K Follow-up  OEI-05-98-00591