DEPARTMENT OF HEALTH & HUMAN SERVICES 
Health Care Financing Administration  
 Center for Medicaid and State Operations 
7500 Security Boulevard 
Baltimore, MD 21244-1850 
June 18, 1999  
Dear State Medicaid Director:  
On May 24, the Health Care Financing Administration (HCFA) released two memoranda, one to doctors , and one to 
HCFA's other health care partners , informing them that HCFA and its Medicare contractors are fully prepared to process 
all appropriately formatted claims and information exchanges on January 1, 2000. Since many of these doctors and other 
health care partners also provide services to Medicaid beneficiaries, we wanted to ensure you were aware of this important 
correspondence.  
Enclosed is a copy of each letter and the enclosures, (http://www.hcfa.gov/y2k/attach2.htm) Suggested Steps Toward 
Y2K Readiness; and, (http://www.hcfa.gov/y2k/pltrenc.htm) Sample Provider Y2K Readiness Checklist. We hope these 
materials will also be useful to you and your Medicaid fiscal agents as you continue your Y2K Provider Outreach 
Activities.  
If you have any questions, or want more information, please contact Maria Friedman of my staff. Maria can be reached at 
(410) 786-9915, or via e-mail at MFriedman@hcfa.gov.  
Sincerely,  
/s/  
Sally K. Richardson   
Director  
2 Enclosures  
cc:  All HCFA Regional Administrators  All HCFA Associate Regional Administrators for Medicaid and State Operations  
Lee Partridge - American Public Human Services Association  Joy Wilson - National Conference of State Legislatures  
Matt Salo - National Governors Association  
  
   May 24, 1999  
Dear Doctor:  
In January, the Health Care Financing Administration (HCFA) wrote to you about the progress it had made in correcting 
problems in Medicare computer systems caused by the Year 2000 or "Y2K" problem. Many of you responded with letters 
and further questions. The two most frequently asked questions were: "When will HCFA be fully ready to process our 
claims?" and "What do we as physicians need to be doing to be ready for the Year 2000?"  
We are pleased to tell you that HCFA and its Medicare contractors are fully ready to handle all appropriately formatted 
claims and other data exchanges on January 1, 2000. All of HCFA's internal systems have been renovated, tested, 
certified; and necessary changes were implemented by the government-wide Year 2000 deadline of March 31, 1999. 
Among other things, these internal systems operate HCFA's accounts receivable and payable operations; manage the 
eligibility, enrollment, and premium status of our 39 million Medicare beneficiaries; and make payments to more than 400 
managed care plans on behalf of over 6 million beneficiaries. All 75 mission-critical claims processing systems operated 
by our Medicare contractors are also certified as compliant, including end-to-end and future-date testing. We continue to 
test and retest our renovated systems. We want to be sure that you get paid for the valuable work you do.  
The Y2K computer problem is far more than a billing problem. We are pleased so many of you are asking the second 
question about what you need to do. This is a patient care and quality of care issue as well as a technical one. Our 
expectation is that you will continue to provide the quality of care your patients depend upon. As physicians, you will 
need to prepare your internal office systems to communicate with HCFA systems and prepare other aspects of your 
practice to continue to function reliably after January 2000. We urge you to take the following steps toward Y2K 
readiness: (Please see the enclosed attachments for more details.)  
   Understand the issue so that you can assure your patients of continued quality care.   
   Access the numerous public and private websites offering Y2K guidance.   
   Inventory your practice for other Y2K problems with the attached checklist.   
   Contact your Medicare carrier now for testing of your billing submissions.   
   Contact your other major third party payers and your State Medicaid Agency.   
   Develop business contingency plans in the event something might go wrong.   
More detail on each of these steps is (http://www.hcfa.gov/y2k/attach2.htm)attached. This is not an exhaustive list but is 
meant to guide you in your Y2K readiness efforts. I have also attached a (http://www.hcfa.gov/y2k/pltrenc.htm) Sample 
Provider Y2K Readiness Checklist for your information. Many of you have taken steps to prepare for Y2K and have 
helped us get ready for January 1, 2000, and we thank you. Please continue to let us know, through our Medicare 
contractors, our toll-free Y2K provider line (1-800-958-HCFA [4232]), and our website (www.hcfa.gov/y2k), what 
further HCFA activities would help you to get ready.  
Sincerely,  
Nancy-Ann Min DeParle  Administrator  
Robert A. Berenson, M.D.  Director  Center for Health Plans and Providers  
Enclosures  
  
   May 24, 1999  
Dear Health Care Partner:  
I wrote to you in January about the substantial progress that the Health Care Financing Administration ((HCFA) had made 
in eliminating the Y2K bug from Medicare computer systems and about your part in assuring the continued quality of the 
health care system. Many of you responded with letters and further questions. The two most frequently asked questions 
were: "When will HCFA be fully ready to process our claims?" and "What do we as providers need to be doing to be 
ready for the Year 2000?"  
We are pleased to inform you that HCFA and its Medicare contractors are fully ready to handle all appropriately 
formatted claims and information exchanges on January 1, 2000. All of HCFA's mission critical internal systems were 
renovated, tested, certified, and implemented by the government-wide Year 2000 deadline of March 31, 1999. Among 
other things, these internal systems manage the eligibility, enrollment, and premium status of our 39 million Medicare 
beneficiaries; make payments to more than 400 managed care plans on behalf of over 6 million beneficiaries; and operate 
HCFA's accounts receivable and payable operations. All 75 mission-critical claims processing systems operated by our 
Medicare contractors are also certified as compliant, including end-to-end and future-date testing. We continue to test and 
retest our renovated systems. We want to be sure that you get paid for the valuable work you do.  
The available surveys indicate that health care providers, particularly physicians, clinics, and skilled nursing facilities, 
have not resolved the problems that may occur on January 1, 2000. This so-called "Y2K Bug" is far more than a billing 
problem. We are pleased so many of you are asking the second question about what you need to do. This is a patient care 
and quality of care issue as well as a technical one. Our expectation is that you will continue to provide the quality of care 
your patients depend upon. We urge you to take the following steps toward Y2K readiness:  
   Understand the issue so that you can assure your patients of continued quality care.   
   Access the numerous public and private websites offering Y2K guidance.   
   Inventory your business for other Y2K problems with the attached checklist.   
   Contact your Medicare contractor now for testing of your billing submissions.   
   Contact your other major third party payers and your State Medicaid Agency.   
   Develop business contingency plans in the event something might go wrong.   
More detailed information on each of these steps is (http://www.hcfa.gov/y2k/attach2.htm) attached as well as a 
(http://www.hcfa.gov/y2k/pltrenc.htm) Sample Provider Y2K Readiness Checklist. This is not an exhaustive list but is 
meant to guide you in your Y2K readiness efforts. Also, we want to thank the many of you who have already taken steps 
to prepare for the millennium and have helped us get ready for January 1, 2000. Please continue to let us know, through 
your Medicare contractors, our toll-free Y2K provider line (1-800-958-HCFA [4232]), and our website 
(www.hcfa.gov/y2k) what further HCFA activities would help you to get ready.  
Sincerely,  
Nancy-Ann Min DeParle   
Administrator  
Enclosures