prompt_front: You are given two reports by the government agency.



Question: Write a one-page summary of the report 1.

Report 1: The Veterans Access, Choice, and Accountability Act of 2014 provided up to $10 billion in funding for veterans to obtain health care services from community providers through the Choice Program when veterans faced long wait times, lengthy travel distances, or other challenges accessing care at VA medical facilities  The temporary authority and funding for the Choice Program was separate from other previously existing programs through which VA has the option to purchase care from community providers  Legislation enacted in August and December of 2017 and June 2018 provided an additional $9 4 billion for the Veterans Choice Fund  Authority of the Choice Program will sunset on June 6, 2019  In October 2014, VA modified its existing contracts with two TPAs that were administering another VA community care program—the Patient- Centered Community Care program—to add certain administrative responsibilities associated with the Choice Program  For the Choice Program, each of the two TPAs—Health Net and TriWest—are responsible for managing networks of community providers who deliver care in a specific multi-state region  (See fig  1 ) Specifically, the TPAs are responsible for establishing networks of community providers, scheduling appointments with community providers for eligible veterans, and paying community providers for their services  Health Net’s contract for administering the Choice Program will end on September 30, 2018, whereas TriWest will continue to administer the Choice Program until the program ends, which is expected to occur in fiscal year 2019  VA’s TPAs process claims they receive from community providers for the care they deliver to veterans and pay providers for approved claims  Figure 2 provides an overview of the steps the TPAs follow for processing claims and paying community providers  VA’s contracts with the TPAs do not include a payment timeliness requirement applicable to the payments TPAs make to community providers  Instead, a contract modification effective in March 2016 established a non-enforceable “goal” of processing—approving, rejecting or denying—and, if approved, paying clean claims within 30 days of receipt  To be reimbursed for its payments to providers, the TPAs in turn submit electronic invoices—or requests for payment—to VA  TPAs generate an invoice for every claim they receive from community providers and pay  VA reviews the TPAs’ invoices and either approves or rejects them  Invoices may be rejected, for example, if care provided was not authorized  Approved invoices are paid, whereas rejected invoices are returned to the TPAs  The federal Prompt Payment Act requires VA to pay its TPAs within 30 days of receipt of invoices that it approves  The VA MISSION Act of 2018, among other things, requires VA to consolidate its community care programs once the Choice Program sunsets 1 year after the passage of the Act, authorizes VA to utilize a TPA for claims processing, and requires VA to reimburse community providers in a timely manner  Specifically, the act requires VA (or its TPAs) to pay community providers within 30 days of receipt for clean claims submitted electronically and within 45 days of receipt for clean claims submitted on paper  In December 2016, prior to enactment of the VA MISSION Act of 2018, VA issued an RFP for contractors to help administer the Veterans Community Care Program  The Veterans Community Care Program will be similar to the current Choice Program in certain respects  For example, VA is planning to award community care network contracts to TPAs, which would establish regional networks of community providers and process and pay those providers’ claims  However, unlike under the Choice Program, under the Veterans Community Care Program, VA is planning to have medical facilities—not the TPAs—generally be responsible for scheduling veterans’ appointments with community providers  From November 2014 through June 2018, VA’s TPAs paid a total of about 16 million clean claims—which are claims that contain all required data elements—under the Choice Program, of which TriWest paid about 9 6 million claims and Health Net paid about 6 4 million  Data on the median number of days VA’s TPAs have taken to pay clean claims each month show wide variation over the course of the Choice Program—from 7 days to 68 days  As discussed previously, in March 2016, VA established a non-enforceable goal for its TPAs to process and, if approved, pay clean claims within 30 days of receipt each month  Most recently, from January through June 2018, the median number of days taken to pay clean claims ranged from 26 to 28 days for TriWest, while it ranged from 28 to 44 days for Health Net  (See fig  3 ) In addition to the 16 million clean claims the TPAs paid from November 2014 through June 2018, during this time period they also paid approximately 650,000 claims (or 4 percent of all paid claims) that were classified as non-clean claims when first received after obtaining the required information  Non-clean claims are claims that are missing required information, which the TPA must obtain before the claim is paid  From November 2014 through June 2018, TriWest paid around 641,000 non-clean claims (or 6 percent of all paid claims) while Health Net paid about 9,600 non-clean claims (or less than 1 percent of all paid claims)  Data on the median number of days VA’s TPAs have taken to pay non- clean claims each month also show wide variation over the course of the Choice Program—from 9 days to 73 days  (See fig  4 ) The data on the time TPAs have taken to pay approved clean and non- clean claims do not fully account for the length of time taken to pay providers whose claims are initially rejected or denied, as, according to the TPAs, providers are generally required to submit a new claim when the original claim is rejected or denied  Thus, providers that submit claims that are rejected or denied may experience a longer wait for payment for those claims or may not be paid at all  In some cases, providers’ claims may be rejected or denied multiple times after resubmission  VA and its TPAs identified three key factors affecting the timeliness of claim payments to community providers under the Choice Program: (1) VA’s untimely payments of TPA invoices; (2) Choice Program contractual requirements related to provider reimbursement; and (3) inadequate provider education on filing Choice Program claims, as discussed below  VA’s untimely payments of TPA invoices  According to VA and TPA officials, VA made untimely invoice payments to its TPAs—that is, payments made more than 30 days from the date VA received the TPAs’ invoices—which resulted in the TPAs at times having insufficient funds available to pay community providers under the Choice Program  A VA Office of Inspector General (OIG) report estimated that from November 2014 through September 2016, 50 percent of VA’s payments to its TPAs during this time frame were untimely  VA officials stated that VA’s untimely payments to the TPAs resulted from limitations in its fee-basis claims system, which VA used at the beginning of the Choice Program to process all TPA invoices  In addition, the VA OIG found that VA underestimated the number of staff necessary to process Choice Program invoices in a timely manner  Choice Program reimbursement requirements  According to VA and TPA officials, three Choice Program requirements, some of which were more stringent than similar requirements in other federal health care programs, led to claim denials, which, in turn, contributed to the length of time TPAs have taken to pay community providers when the providers did not meet these requirements: 1  Medical documentation requirement  Prior to a March 2016 contract modification, VA required providers to submit relevant medical documentation with their claims as a condition of payment from the TPAs  According to TriWest officials, those Choice Program claims that did not include medical documentation were classified by TriWest as non-clean claims and placed in pending status until the documentation was received  When community providers did not provide the supporting medical documentation after a certain period of time, TriWest typically denied their claims  According to Health Net officials, Choice Program claims that did not include medical documentation were denied by Health Net  2  Timely filing requirement  VA requires providers to file Choice Program claims within 180 business days from the end of an episode of care  TPAs deny claims that are not filed within the required time frame  3  Authorization requirement  VA requires authorizations for community providers to serve veterans under the Choice Program and receive reimbursement for their services; however, if community providers deliver care after an authorization period or include services that are not authorized, the TPAs typically deny their claims  According to TPA data, denials related to authorizations are among the most common reasons the TPAs deny community provider claims  Inadequate provider education on filing Choice Program claims  According to VA and TPA officials as well as providers we interviewed, issues related to inadequate provider education may have contributed to the length of time it has taken the TPAs to pay community providers under the Choice Program  These issues have included providers submitting claims with errors, submitting claims to the wrong payer, or otherwise failing to meet Choice Program requirements  For example, some VA community care programs require the claims to be sent to one of VA’s claims processing locations, while the Choice Program requires claims to be sent to TriWest or Health Net  Claims sent to the wrong entity are rejected or denied and have to be resubmitted to the correct payer  Ten of the 15 providers we interviewed stated that that they lacked education and/or training on the claims filing process when they first began participating in the Choice Program, including knowing where to file claims and the documentation needed to file claims that would be processed successfully  Four of these 10 providers stated that they learned how to submit claims through trial and error  At the infancy of the Choice Program, November 2014 through March 2016, VA was unable to monitor the timeliness of its TPAs’ payments to community providers because it did not require the TPAs to provide data on the length of time taken to pay these claims  Effective in March 2016, VA modified its TPA contracts and subsequently began monitoring TPA payment timeliness, requiring TPAs to report information on claims processing and payment timeliness as well as information on claim rejections and denials  However, because VA had not established a payment timeliness requirement, VA officials said that VA had limited ability to penalize TPAs or compel them to take corrective actions to address untimely claim payments to community providers  Instead, the March 2016 contract modification established a non-enforceable goal for the TPAs to process and pay clean claims within 30 days of receipt  As of July 2018, according to VA officials, VA did not have a contractual requirement it could use to help ensure that community providers received timely payments in the Choice Program  Officials from VA’s Office of Community Care told us that VA’s experience with payment timeliness in the Choice Program informed VA’s RFP for new contracts for the Veterans Community Care Program, which includes provisions that strengthen VA’s ability to monitor its future TPAs  For example, in addition to requiring future TPAs to submit weekly reports on claim payment timeliness as well as claim rejections and denials, VA’s RFP includes claim payment timeliness standards that are similar to those in the Department of Defense’s TRICARE program  Specifically, according to the RFP, TPAs in the Veterans Community Care Program will be required to process and pay, if approved, 98 percent of clean claims within 30 return claims, other than clean claims, to the provider with a clear explanation of deficiencies within 30 days of original receipt, and process resubmitted claims within 30 days of resubmission receipt  The RFP also identifies monitoring techniques that VA may employ to assess compliance with these requirements, including periodic inspections and audits  VA officials told us that VA will develop a plan for monitoring the TPAs’ performance on these requirements once the contracts are awarded  We found that VA has made system and process changes that improved its ability to pay TPA invoices in a timely manner  However, while VA has modified two Choice Program requirements that contributed to provider claim payment delays, it has not fully addressed delays associated with authorizations for care  Furthermore, while VA and its TPAs have taken steps to educate community providers in order to help prevent claims processing issues, 9 of the 15 providers we interviewed reported poor customer service when attempting to resolve these issues  VA has taken steps to reduce untimely payments to its TPAs, which contributed to delayed TPA payments to providers, by implementing a new system and updating its processes for paying TPA invoices so that it can pay these invoices more quickly  Specifically, VA has made the following changes: In March 2016, VA negotiated a contract modification with both TPAs that facilitated the processing of certain TPA invoices outside of the fee basis claims system from March 2016 through July 2016  According to VA officials, due to the increasing volume of invoices that the TPAs were expecting to submit to VA during this time period, without this process change, VA would have experienced a high volume of TPA invoices entering its fee basis claims system, which could have exacerbated payment timeliness issues  In February through April 2017, VA transitioned all TPA invoice payments from its fee basis claims system to an expedited payment process under a new system called Plexis Claims Manager  VA officials told us that instead of re-adjudicating community provider claims as part of its review of TPA invoices, Plexis Claims Manager performed up front checks in order to pay invoices more quickly, and any differences in billed and paid amounts were addressed after payments were issued to the TPAs  In January 2018, VA transitioned to a newer version of the Plexis Claims Manager that enabled VA to once again re-adjudicate community provider claims as part of processing TPA invoices, but in a timelier manner compared with the fee basis claims system  According to VA officials, this is due to the automation of claims processing under Plexis Claims Manager, which significantly reduced the need for manual claims processing by VA staff that occurred under the fee basis claims system  Based on VA data, as of July 2018, VA is paying 92 percent of TriWest’s submitted invoices within 7 days, with payments being made in an average of 4 days, and 90 percent of Health Net’s invoices within 7 days, with payments being made in an average of 4 days under the newer version of Plexis Claims Manager  In addition to steps taken to address untimely payments to the TPAs under the current Choice Program contracts, VA has taken steps to help assure payment timeliness in the forthcoming Veterans Community Care Program  Specifically, the RFP includes a requirement for VA to reimburse TPAs within 14 days of receiving an invoice  VA officials stated that to achieve this metric, they are implementing a new payment system that will replace Plexis Claims Manager and will no longer re-adjudicate TPA invoices prior to payment  VA has issued a contract modification and waivers for two Choice Program contract requirements that contributed to provider payment delays—(1) the medical documentation requirement and (2) the timely filing requirement  However, while VA issued a contract modification to amend the requirements for obtaining authorizations for Choice Program care, provider payment delays associated with requesting these authorizations may persist, because VA is not ensuring that VA medical centers review and approve these requests within required time frames  Elimination of medical documentation requirement  Effective beginning March 2016, VA issued a contract modification that eliminated the requirement that community providers must submit medical documentation as a condition of receiving payment for their claims  Data from one TPA showed a reduction in non-clean claims following the implementation of this contract modification  For example, starting in April 2016, after this modification was executed, almost 100 percent of claims submitted to TriWest were classified as clean claims, as opposed to 49 percent of claims submitted in March 2016  However, when the modification first went into effect in March 2016, TriWest and Health Net officials stated that they processed a large amount of claims from community providers that had previously been pended or denied because they lacked medical documentation and, in turn, submitted a large number of invoices to VA for reimbursement  As previously discussed, to help address the increased number of TPA invoices, VA issued lump-sum payments to the TPAs during this time period  Modification of timely filing requirement  In February and May 2018, VA issued waivers that gave TPAs the authority to allow providers to resubmit rejected or denied claims more than 180 days after the end of the episode of care if the original claims were submitted timely—that is, within 180 days of the end of the episode of care  VA officials stated that the waivers were intended to reduce the number of rejected and denied claims by giving community providers the ability to resubmit previously rejected or denied claims for which the date of service occurred more than 180 days ago  VA’s waivers were implemented as follows: In February 2018, VA issued a waiver that allowed community providers to resubmit certain claims rejected or denied for specific reasons when the provider or TPA could verify that the provider made an effort to submit the claim prior to the claims submission deadline  In May 2018, VA issued a second waiver that removed the 180 day timeliness requirement for all Choice Program claims  The waiver also provided instructions to the TPAs on informing providers that they may resubmit claims rejected or denied for specific reasons and how the TPAs are to process the resubmitted claims  In regards to the first waiver, TPA officials stated that the processing of those resubmitted claims adversely affected the timeliness of the TPAs’ payments to community providers because the waiver resulted in a large influx of older claims  As the second waiver was in the process of being implemented by the two TPAs at the time we conducted our work, we were unable to determine if the second waiver affected the TPAs’ provider payment timeliness  Changes to authorization of care requirement  VA issued a contract modification in January 2017 to expand the time period for which authorizations for community providers to provide care to veterans under the Choice Program are valid  In addition, in May 2017, VA expanded the scope of the services covered by authorizations, allowing them to encompass an overall course of treatment, rather than a specific service or set of services  According to VA officials, the changes VA made related to the authorization of care requirement were also intended to reduce the need for secondary authorization requests (SAR)  Community providers request SARs when veterans need health care services that exceed the period or scope of the original authorizations  Community providers are required to submit SARs to their TPA, which, in turn, submits the SARs to the authorizing VA medical facility for review and approval  Both Health Net and TriWest officials told us that since VA changed the time frame and scope of authorizations, the number of SARs has decreased  Despite efforts to decrease the number of SARs, payment delays or claim denials are likely to continue if SARs are needed  We found that VA is not ensuring that VA medical facilities are reviewing and approving SARs within required time frames  VA policy states that VA medical facilities are to review and make SAR approval decisions within 5 business days of receipt  However, officials from one of the TPAs and 7 of the 15 providers we interviewed stated that VA medical facilities are not reviewing and approving SARs in a timely manner  According to TriWest officials, as of May 2018, VA medical facilities in their regions were taking an average of 11 days to review and make approval decisions on SARs, with four facilities taking over 30 days for this process  According to an official from VA’s Office of Community Care, VA does not currently collect reliable national data to track the extent of nonadherence to the VA policy to review and make SAR approval decisions within 5 business days  The official told us that instead, VA relies on employees assigned to each Veterans Integrated Service Network to monitor data on VA medical facilities’ timeliness in making these SAR approval decisions  If a VA medical facility is found not to be in adherence with the SAR policy, the official told us that staff assigned to the Veterans Integrated Service Network attempt to identify the reasons for nonadherence, and perform certain corrective actions, including providing education to the facility  Despite these actions, the official told us that there are still VA medical facilities not in adherence with VA’s SAR approval policy  According to a VA official, VA is in the process of piloting software for managing authorizations that will allow VA to better track SAR approval time frames across VA medical facilities in the future  However, even after this planned software is implemented, if VA does not use the data to monitor and assess SAR approval decision time frames VA will be unable to ensure that all VA medical facilities are adhering to the policy  Standards for internal control in the Federal Government state that management should establish and operate monitoring activities to evaluate whether a specific function or process is operating effectively and take corrective actions as necessary  Furthermore, monitoring such data will allow VA to identify and take actions as needed to address any identified challenges VA medical facilities are encountering in meeting the required approval decision time frames  Without monitoring data to ensure that all VA medical facilities are adhering to the SAR approval time frames as outlined in VA policy, community providers may delay care until the SARs are approved or provide care without SAR approval  This in turn increases the likelihood that the community providers’ claims will be denied  Further, continued nonadherence to VA’s SAR policy raises concerns about VA’s ability to ensure timely approval of SARs when VA medical facilities assume more responsibilities for ensuring veterans’ access to care under the forthcoming Veterans Community Care Program  We found that VA and its TPAs have taken steps to educate community providers in order to help prevent claims processing issues that have contributed to the length of time TPAs have taken to pay these providers  Despite these efforts, 9 of the 15 providers we interviewed reported poor customer service when attempting to resolve claims payment issues  While VA’s contracts with the TPAs do not include requirements for educating and training providers on the Choice Program, both TPAs have taken steps to educate community providers on how to successfully submit claims under the Choice Program  Specifically, TriWest and Health Net officials told us that they have taken various steps to educate community providers on submitting claims correctly, including sending monthly newsletters, emails, and faxes to communicate changes to the Choice Program; updating their websites with claims processing information; and holding meetings with some providers monthly or quarterly to resolve claims processing issues  Officials from both TPAs also told us that they provided one-on-one training to some providers on the claims submission process to help reduce errors when submitting claims  In addition, VA’s RFP for the Veterans Community Care Program contracts includes requirements to provide an annual training program curriculum and an initial on-boarding and ongoing outreach and education program for community providers, which includes training on the claims submission and payment processes and TPA points of contact  VA and the TPAs have also made efforts to help providers resolve claims processing issues and outstanding payments  For example, VA launched its “top 20 provider initiative” in January 2018 to work directly with community providers with high dollar amounts of unpaid claims and resolve ongoing claims payment issues  This initiative included creating rapid response teams to work with community providers to settle unpaid claim balances within 90 days and working with both TPAs to increase the number of clean claims paid in less than 30 days  In addition, VA has developed webinars on VA’s community care programs and—in conjunction with trade organizations and health care systems—has delivered provider education on filing claims properly  TriWest officials stated that it has educated the customer service staff at its claims processing sub-contractor, who field community provider calls regarding claims processing issues, to help ensure that the staff are familiar with Choice Program changes and can effectively assist community providers and resolve claims processing issues  Internal TriWest data show that providers’ average wait time to speak to a customer service representative about claims processing issues decreased from as high as 18 minutes in 2016 to as low as 2 5 minutes in 2018  Health Net officials were unable to provide data, but stated that since the fourth quarter of 2017, Health Net has decreased the time it takes for a community provider to speak with a customer service representative by adding additional staff and extending the hours in which providers can call with questions  In addition, Health Net officials stated that they have required customer service staff to undergo additional training related to resolving claims processing issues  Despite these efforts, 7 of the 10 providers that participate in the Health Net network and 2 of the 7 providers that participate in the TriWest network we interviewed between April and June 2018 told us that when they contact the TPAs’ customer service staff to address claim processing questions, such as how to resolve claim rejections or denials, they experience lengthy hold times, sometimes exceeding one hour  In addition, 7 of the 15 providers we spoke with told us they typically reach employees who are unable to answer their questions  According to these providers, this experience frustrated them, as they often did not understand why a claim had been denied or rejected, and they required assistance correcting the claim so it could be resubmitted  One community provider stated that their common practice to resolve questions or concerns was to call customer service enough times until they received the same answer twice from a TPA representative  In addition, 5 of the 10 Health Net providers we interviewed stated that they have significant outstanding claim balances owed to them  One of these providers—who reported over $3 million in outstanding claims—stressed the importance of being able to effectively resolve claims issues with TPA customer service staff, as the administrative burden of following up on outstanding claim balances takes time away from caring for patients  The issues concerning customer service wait times and TPA staff inability to resolve some claims processing issues reported by community providers appear to be inconsistent with VA contractual requirements  VA’s current Choice Program contracts require the TPAs to establish a customer call center to respond to calls from veterans and non-VA providers  The contract requires specified levels of service for telephone inquiries at the call center  For example, VA requires TPA representatives to answer customer service calls within an average speed of 30 seconds or less and requires 85 percent of all inquiries to be fully and completely answered during the initial telephone call  However, VA officials explained that VA does not enforce the contractual requirement for responding to calls from community providers  Furthermore, according to these officials, VA allows the TPAs to prioritize calls from veterans  Officials from VA’s Office of General Counsel, Procurement Law Group, confirmed that this requirement does apply to the TPAs’ handling of calls from community providers  Because VA does not enforce the customer service requirement for providers, VA has not collected data on or monitored the TPAs’ compliance with these requirements for providers’ calls  As previously stated, standards for internal control in the Federal Government state that management should establish and operate monitoring activities to evaluate whether a specific function or process is operating effectively and take corrective actions as necessary  Without collecting data and monitoring customer service requirements for provider calls, VA does not have information on the extent to which community providers face challenges when contacting the TPAs about claims payment issues that could contribute to the amount of time it takes to successfully file claims and receive reimbursement for services under the Choice Program  This, in turn, poses a risk to the Choice Program to the extent that community providers who face these challenges decide not to serve veterans under the Choice Program  Looking forward, VA has included customer service requirements in its RFP for the Veterans Community Care Program contracts, and VA officials have told us that these requirements are applicable to provider calls  For example, the RFP includes a requirement for its future TPAs to establish and maintain call centers to address inquiries from community providers and has established customer service performance metrics to monitor call center performance  Monitoring data on provider calls under the contracts will be important as Veterans Community Care Program TPAs will continue to be responsible for building provider networks, processing claims, and resolving claims processing issues  The Choice Program relies on community providers to deliver care to eligible veterans when VA is unable to provide timely and accessible care at its own facilities  Although VA has taken steps to improve the timeliness of TPA claim payments to providers, VA is not collecting data or monitoring compliance with two Choice Program requirements, and this could adversely affect the timeliness with which community providers are paid under the Choice Program  First, VA does not have complete data allowing it to effectively monitor adherence with its policy for VA medical facilities to review SARs within 5 days of receipt, which impacts its ability to meet the requirement  To the extent that VA medical facilities delay these reviews and approvals, community providers may have to delay care or deliver care that is not authorized, which in turn increases the likelihood that the providers’ claims will be denied and the providers will not be paid  Second, VA requires the TPAs to establish a customer call center to respond to calls from veterans and non-VA providers  However, VA does not enforce the contractual requirement for responding to calls from community providers and allows the TPAs to prioritize calls from veterans  Consequently, VA is not collecting data, monitoring, or enforcing compliance with its contractual requirements for the TPAs to provide timely customer service to providers  As a result, VA does not have information on the extent to which community providers face challenges when contacting the TPAs about claims payment issues, which could contribute to the amount of time it takes to receive reimbursement for services  To the extent that these issues make community providers less willing to continue participating in the Choice Program and the forthcoming Veterans Community Care Program, they pose a risk to VA’s ability to successfully implement these programs and ensure veterans’ timely access to care  We are making the following two recommendations to VA: Once VA’s new software for managing authorizations has been fully implemented, the Undersecretary for Health should monitor data on SAR approval decision time frames to ensure VA medical facilities are in adherence with VA policy, assess the reasons for nonadherence with the policy, and take corrective actions as necessary  (Recommendation 1) The Undersecretary for Health should collect data and monitor compliance with the Choice Program contractual requirements pertaining to customer service for community providers, and take corrective actions as necessary  (Recommendation 2) We provided a draft of this report to VA for review and comment  In its written comments, reproduced in appendix I, VA concurred with our two recommendations and said it is taking steps to address them  For example, VA plans to implement software in spring 2019 that will automate the SAR process and allow for streamlined reporting and monitoring of SAR timeliness to ensure ongoing compliance  Additionally, VA has included provider customer service performance requirements and metrics in its Veterans Community Care Program RFP, and will require future contractors to provide a monthly report to VA on their call center operations and will implement quarterly provider satisfaction surveys  We are sending copies of this report to the Secretary of Veterans Affairs, the Under Secretary for Health, appropriate congressional committees, and other interested parties  This report is also available at no charge on the GAO Web site at http://www gao gov  If you or your staff have any questions about this report, please contact Sharon M  Silas at (202) 512-7114 or silass@gao gov  Contact points for our Offices of Congressional Relations and Public Affairs are on the last page of this report  GAO staff who made major contributions to this report are listed in appendix II  In addition to the contact named above, Marcia A  Mann (Assistant Director), Michael Zose (Analyst-in-Charge), and Kate Tussey made major contributions to this report  Also contributing were Krister Friday, Jacquelyn Hamilton, and Vikki Porter 


Report 2: JWST is envisioned to be a large deployable space telescope, optimized for infrared observations, and the scientific successor to the aging Hubble Space Telescope  JWST is being designed for a 5-year mission to find the first stars, study planets in other solar systems to search for the building blocks of life elsewhere in the universe, and trace the evolution of galaxies from their beginning to their current formation  JWST is intended to operate in an orbit approximately 1 5 million kilometers—or 1 million miles—from the Earth  With a 6 5-meter primary mirror, JWST is expected to operate at about 100 times the sensitivity of the Hubble Space Telescope  JWST’s science instruments are designed to observe very faint infrared sources and therefore are required to operate at extremely cold temperatures  To help keep these instruments cold, a multi-layered tennis court-sized sunshield is being developed to protect the mirrors and instruments from the sun’s heat  The JWST project is divided into three major segments: the observatory segment, the ground segment, and the launch segment  When complete, the observatory segment of JWST is to include several elements (Optical Telescope Element (OTE), Integrated Science Instrument Module (ISIM), and spacecraft) and major subsystems (sunshield and cryocooler)  The hardware configuration referred to as OTIS was created when the Optical Telescope Element and the Integrated Science Instrument Module were integrated  Additionally, JWST is dependent on software to deploy and control various components of the telescope, and to collect and transmit data back to Earth  The elements, major subsystems, and software are being developed through a mixture of NASA, contractor, and international partner efforts  See figure 1 for the elements and major subsystems of JWST and appendix 1 for more details, including a description of the elements, major subsystems, and JWST’s instruments  For the majority of work remaining, the JWST project is relying on two contractors: Northrop Grumman and the Association of Universities for Research in Astronomy’s Space Telescope Science Institute  Northrop Grumman plays the largest role, developing the sunshield, the Optical Telescope Element, the spacecraft, and the Mid-Infrared Instrument’s cryocooler, in addition to integrating and testing the observatory  Space Telescope Science Institute’s role includes soliciting and evaluating research proposals from the scientific community, and receiving and storing the scientific data collected, both of which are services that it currently provides for the Hubble Space Telescope  Additionally, the Institute is developing the ground system that manages and controls the telescope’s observations and will operate the observatory on behalf of NASA  JWST will be launched on an Ariane 5 rocket, provided by the European Space Agency  JWST depends on 22 deployment events—more than a typical science mission—to prepare the observatory for normal operations on orbit  For example, the sunshield and primary mirror are designed to fold and stow for launch and deploy once in space  Due to its large size, it is nearly impossible to perform deployment tests of the fully assembled observatory, so the verification of deployment elements is accomplished by a combination of lower level component tests in flight-simulated environments; ambient deployment tests for assembly, element, and observatory levels; and detailed analysis and simulations at various levels of assembly  We have previously found that complex development efforts like JWST face numerous risks and unforeseen technical challenges, which can often become apparent during integration and testing  To accommodate unanticipated challenges and manage risk, projects reserve extra time in their schedules, which is referred to as schedule reserve, and extra funds in their budgets, which is referred to as cost reserve  Schedule reserve is allocated to specific activities, elements, and major subsystems in the event of delays or to address unforeseen risks  Each JWST element and major subsystem has been allocated schedule reserve  When an element or major subsystem exhausts schedule reserve, it may begin to affect schedule reserve on other elements or major subsystems whose progress is dependent on prior work being finished for its activities to proceed  Cost reserves are additional funds within the project manager’s budget that can be used to address unanticipated issues for any element or major subsystem, and are used to mitigate issues during the development of a project  For example, cost reserves can be used to buy additional materials to replace a component or, if a project needs to preserve schedule reserve, reserves can be used to accelerate work by adding shifts to expedite manufacturing  NASA’s Goddard Space Flight Center— the NASA center with responsibility for managing JWST—has issued procedures that establish the requirements for cost and schedule reserves  In addition to cost reserves held by the project manager, management reserves are funds held by the contractors that allow them to manage program risks and to address unanticipated cost increases throughout development  We have previously found that management reserves should contain 10 percent or more of the cost to complete a project and are generally used to address various issues tied to the contract’s scope  NASA’s cost-plus-award-fee contract with Northrop Grumman has spanned almost two decades, during which there have been significant variances in contractor performance  Cost-reimbursement contracts are suitable when uncertainties in the scope of work or cost of services prevent the use of contract types in which prices are fixed, known as fixed-price contracts  Award fee contracts provide contractors the opportunity to obtain monetary incentives for performance in designated areas identified in the award fee plan  Award fees may be used when key elements of performance cannot be defined objectively, and, as such, require the project officials’ judgment to assess contractor performance  For JWST’s contract with Northrop Grumman, these areas include cost, schedule, technical, and business management and are established in the contracts’ performance evaluation plans  In December 2013, the JWST program and the contractor agreed to replace a $56 million on-orbit incentive—incentives based on successful performance in space—with award fees  The award fees are to incentivize cost and schedule performance during development  This shift increased the available award fee for the entire contract to almost a quarter of a billion dollars  According to officials, restructuring the incentives gave NASA more flexibility to incentivize the contractor to prioritize the cost and schedule performance over exceeding technical requirements  In December 2014, we found that NASA award fee letters of award fee periods from February 2013 to March 2014 indicated that the contractor had been responsive to interim award fee period criteria provided by NASA and that contractor officials confirmed that they pay close attention to this guidance in prioritizing their work  For example, Northrop Grumman officials reported that they had made specific changes to improve communications in direct response to this guidance, which was validated by award fee letters from NASA  The JWST program has a history of significant schedule delays and increases to project costs, which resulted in replans in 2011 and 2018  Before 2011, early technical and management challenges, contractor performance issues, low levels of cost reserves, and poorly phased funding caused the JWST program to delay work  As a result, the program experienced schedule overruns, including launch delays, and cost growth  The JWST program underwent a replan in September 2011, and a rebaseline in November of that same year, and Congress placed an $8 billion cap on the formulation and development costs for the project  On the basis of the replan, NASA rebaselined JWST with a life- cycle cost estimate of $8 835 billion, which included additional money for operations and a planned launch in October 2018  Congress also required that NASA treat any cost increase above the cap according to procedures established for projects that exceed their development cost estimates by at least 30 percent  This process is known as a rebaseline  Congress must authorize continuation of the JWST program if formulation and development costs increase over the $8 billion cost cap  In June 2018, after a series of launch delay announcements due to technical and workmanship issues identified during spacecraft element integration, NASA notified Congress that it had again revised the JWST program’s cost and schedule estimates  NASA estimated that it now required $828 million in additional resources and 29 more months to complete beyond those estimates agreed to in the 2011 rebaseline  As of November 2018, NASA had funding to continue to execute the program and was waiting to see if Congress would authorize the program’s continuation and appropriate funds for the program in fiscal year 2019  Figure 2 shows the project’s history of changes to its cost or schedule and key findings from two external independent review teams and our prior work  As discussed above, various technical and workmanship errors drove some of the more recent delays  Examples of some of the workmanship issues we found in the past include: In October 2015, the project reported that a piece of flight hardware for the sunshield’s mid-boom assembly was irreparably damaged during vacuum sealing in preparation for shipping  The damaged piece had to be remanufactured, which consumed 3 weeks of schedule reserve  In April 2017, a contractor technician applied too much voltage and irreparably damaged the spacecraft’s pressure transducers, components of the propulsion system that help monitor spacecraft fuel levels  The transducers had to be replaced and reattached in a complicated welding process  At the same time, Northrop Grumman also addressed several challenges with integrating sunshield hardware  These issues combined took up another 1 25 months of schedule reserve  In May 2017, some of the valves in the spacecraft propulsion system’s thruster modules were leaking beyond permissible levels  Northrop Grumman determined that the most likely cause was the use of an improper cleaning solution, and the thruster modules were returned to the vendor for investigation and refurbishment  Reattaching the refurbished modules was expected to be complete by February 2018, but was delayed by one month when a technician applied too much voltage to one of the components in a recently refurbished thruster module  NASA and Northrop Grumman reported that resolving the thruster module issue resulted in a 2-month delay to the project’s overall schedule  In October 2017, when conducting folding and deployment exercises on the sunshield, Northrop Grumman discovered several tears in the sunshield membrane layers  According to program officials, a workmanship error contributed to the tears  The tears resulted in another 2-month delay to the project’s overall schedule  In addition, some first-time efforts took longer than planned  For example, in fall 2017, the project determined that it would need to use up to 3 months of schedule reserve based upon lessons learned from the contractor’s initial sunshield folding operation  This first deployment, or unfolding, took 30 days longer than planned  The sunshield has since undergone another deployment, and will be deployed twice more before launch  The IRB took into account these technical and workmanship errors, as well as other considerations, when it analyzed the project’s organizational and technical issues  The board’s final report, issued in May 2018, included 31 recommendations that addressed a range of factors  For example, the IRB recommended that the project: Conduct an audit to identify potential embedded design flaws— problems that have not been detected through analysis, inspection, or test activities and pose a significant risk to JWST schedule, cost, and mission success; Establish corrective actions to detect and correct human mistakes during integration and test; Establish a coherent, agreed-upon, and factual narrative on project status and communicate that status regularly across to all relevant stakeholders; and Augment integration and test staff to ensure adequate long-term staffing and improve employee morale  In its response to the IRB’s report, NASA stated that it accepted the report’s recommendations and had already begun implementing action in response to many of them  Further, project officials told us that some of the actions were underway before the IRB completed its review  To develop a new schedule for JWST’s 2018 replan, NASA took into account the remaining integration and test work and added time to the schedule to address threats that were not yet mitigated  This includes 5 5 months to address an anomaly that occurred on the sunshield’s cover in 2018  The project also replenished its schedule reserves—which we found in February 2018 had been consumed—so that they now exceed the recommended levels  Both the project and IRB conducted schedule risk assessments that produced similar launch dates  The project relied on the replan schedule to determine its remaining costs because the workforce necessary to complete the observatory represents most of the remaining cost  Following is additional information on the schedule and cost considerations  Schedule: JWST’s revised launch readiness date of March 2021 reflects a consideration of the hardware integration and test challenges the project has experienced, including adding time to: Add snag guards for the membrane tensioning system—which helps deploy the sunshield and maintain its correct shape—to prevent excess cable from snagging, Repair tears of the sunshield membrane, Deploy, fold, and stow the sunshield, and Mitigate contractor schedule threats  In addition, the project added extra time to the schedule to complete repairs to the membrane cover assembly, which did not perform as expected during acoustics testing in April 2018  The membrane cover assembly shown in figure 3 is used to cover the sunshield membrane when in the stowed position to provide thermal protection during launch  After the anomaly occurred, the project halted spacecraft element testing, investigated the anomaly, and found that the fasteners had come loose due to a design change made to prevent the fasteners from damaging the sunshield membrane  The design change caused the nuts to not lock properly  According to project officials, due to the design of the membrane cover assembly, the project was not able to conduct flight-like, stand- alone testing on the cover prior to spacecraft element testing  As a result, the project did not discover the design issue until the hardware came loose while installed on the spacecraft element  The project determined that the repairs would take approximately 5 5 months  The project’s replan also reflected schedule reserves above the level required by Goddard Space Flight Center policy, which would have been approximately 5 months at that time  The new schedule includes a total of 293 days or 9 6 months of schedule reserves leading up to its committed launch readiness date of March 2021  NASA approved a JWST launch date of March 2021, but the project and the contractor are working toward a launch date in November 2020  Figure 4 shows the project’s new schedule following the 2018 replan, including how the project distributed its schedule reserves through different integration and test activities  As part of its May 2018 study, the IRB reviewed the project’s schedule and recommended a launch date of March 2021, which was subsequently reflected in NASA’s new schedule for the program  In reviewing the project’s schedule, the IRB found that the project had robust scheduling practices for ensuring that the schedule represented a complete and dynamic network of tasks that could respond automatically to changes  This schedule also passed a standard health check with minimal errors indicating that it was well constructed  However, the IRB noted that this schedule does not account for certain types of unknown risks to the program such as integration and test errors which can take many months to resolve, or the potential need to remove a science instrument from the observatory, which can have about a 1 year impact  As a result, the program could experience additional delays if a risk of this magnitude is realized  Cost: The project’s new $9 7 billion life-cycle cost estimate is principally driven by the schedule extension, which requires keeping the contractor’s workforce to complete integration and test longer than expected  Specifically, the project determined that almost all of the hardware had been delivered and the remaining cost was predominantly the cost for the workforce necessary to complete and test the observatory  For the past 3 years, we have reported that Northrop Grumman’s ability to decrease its workforce was central to JWST’s capacity to meet its long- term cost commitments  However, Northrop Grumman’s actual workforce continued to exceed its projections  This was because it needed to maintain higher workforce levels due to technical challenges, including problems with spacecraft and sunshield integration and test  It also needed to keep specialized engineers available when needed during final assembly and test activities  In developing the cost estimate supporting the 2018 replan, the project used a Northrop Grumman workforce profile that is higher than previous projections because Northrop Grumman now plans to maintain personnel longer during integration and test  According to project officials, the planned reduction of Northrop Grumman’s workforce is now more gradual and conservative than the prior plan  For example, the Northrop Grumman workforce will not start to significantly decline until the observatory ships to the launch site, which is expected to occur in August 2020  As shown in Figure 5, the JWST workforce assembling the observatory declines and the government and contractor workforce necessary to manage and operate the observatory remains after the internal launch readiness date of November 2020  As seen in the above figure, the Space Telescope Science Institute workforce, the contractor responsible for operating JWST, will remain generally flat between fiscal years 2021 to 2026 when it operates the observatory  The NASA civil service and support contractor will remain relatively flat through November 2020 launch date and then decline  In addition, the new cost estimate also took into account $61 million for implementing the IRB recommendations and mission success enhancements, funding for project cost reserves, and operations costs  In June 2018, the NASA associate administrator—who is the project’s decision authority—approved the project to proceed with its replan with a March 2021 launch date and $9 7 billion in life-cycle costs based on the Agency Program Management Council review and replan documents  The associate administrator did not require the project to conduct an updated Joint Cost and Schedule Confidence Level (JCL) analysis for this replan

ground_truth: Questions have been raised about the lack of timeliness of TPAs' payments to community providers under the Choice Program and how this may affect the willingness of providers to participate in the program as well as in the forthcoming Veterans Community Care Program. You asked GAO to review issues related to the timeliness of TPAs' payments to community providers under the Choice Program. This report examines, among other things, (1) the length of time TPAs have taken to pay community providers' claims and factors affecting timeliness of payments, and (2) actions taken by VA and the TPAs to reduce the length of time TPAs take to pay community providers for Choice Program claims. GAO reviewed TPA data on the length of time taken to pay community provider claims from November 2014 through June 2018, the most recent data available at the time of GAO's review. GAO also reviewed documentation, such as the contracts between VA and its TPAs, and interviewed VA and TPA officials. In addition, GAO interviewed a non-generalizable sample of 15 community providers, selected based on their large Choice Program claims volume, to learn about their experiences with payment timeliness. The Department of Veterans Affairs' (VA) Veterans Choice Program (Choice Program) was created in 2014 to address problems with veterans' timely access to care at VA medical facilities. The Choice Program allows eligible veterans to obtain health care services from providers not directly employed by VA (community providers), who are then reimbursed for their services through one of the program's two third-party administrators (TPA). GAO's analysis of TPA data available for November 2014 through June 2018 shows that the length of time the TPAs took to pay community providers' clean claims each month varied widely—from 7 days to 68 days. VA and its TPAs identified several key factors affecting timeliness of payments to community providers under the Choice Program, including VA's untimely payments to TPAs, which in turn extended the length of time TPAs took to pay community providers' claims; and inadequate provider education on filing claims. VA has taken actions to address key factors that have contributed to the length of time TPAs have taken to pay community providers. For example, VA updated its payment system and related processes to pay TPAs more quickly. According to VA data, as of July 2018, VA was paying at least 90 percent of the TPAs' invoices within 7 days. In addition, VA and the TPAs have taken steps to improve provider education to help providers resolve claims processing issues. However, 9 of the 15 providers GAO interviewed said they continue to experience lengthy telephone hold times. According to VA and TPA officials, steps have been taken to improve the customer service offered to community providers. However, VA officials do not collect data on or monitor TPA compliance with customer service requirements—such as calls being answered within 30 seconds or less—for provider calls because they said they are not enforcing the requirements and are allowing TPAs to prioritize calls from veterans. Without collecting data and monitoring compliance, VA does not have information on challenges providers may face when contacting TPAs to resolve payment issues. GAO is making two recommendations, including that VA should collect data on and monitor compliance with its requirements pertaining to customer service for community providers. VA concurred with GAO's recommendations and described steps it will take to implement them.

prompt_front: You are given two reports by the government agency.



Question: Write a one-page summary of the report 2.



Report 2:  A JCL is an integrated analysis of a project’s cost, schedule, risk, and uncertainty whose result indicates the probability of a project’s success of meeting cost and schedule targets  NASA policy states that a JCL should be recalculated and approved as a part of the rebaselining approval process, but it is not required  In its replan decision memo, NASA’s associate administrator explained that he did not require the project to update the JCL because project costs are almost entirely related to the workforce and most of the remaining planned activities will be performed generally in sequence  Therefore, according to NASA’s associate administrator, the total cost would be driven almost entirely by the schedule because the workforce levels will remain the same through delivery of the observatory  Both the project and independent estimators used multiple schedule estimating methods to analyze the schedule for the remaining work, and NASA’s associate administrator said these analyses returned consistent, high confidence launch dates  The project’s ability to execute to its new schedule will be tested as it progresses through the remainder of challenging integration and test work  The project has yet to complete three of five integration and test phases  The remaining phases include integration and test of OTIS, the spacecraft element, and the observatory  Our prior work has shown that integration and testing is the phase in which problems are most likely to be found and schedules tend to slip  For a uniquely complex project such as JWST, this risk is magnified as events start to become more sequential in nature  As a result, it will continue to become more difficult for the project to avoid schedule delays by mitigating issues in parallel  As of November 2018, the project is about a week behind its replanned schedule because repairs on the membrane cover assembly took longer than planned  Completing the membrane cover assembly repairs and returning the spacecraft to vibration testing was a key event for the project to demonstrate that it could execute to its new schedule  When the project developed its 2018 replanned schedule, it had planned to complete the membrane cover assembly repairs and reinstall the assembly onto the sunshield and restart spacecraft element integration and test activities by November 6, 2018  The project allocated 4 weeks of schedule reserves specifically for these repairs  However, the membrane cover repairs proved more difficult than anticipated  For example, the program had to address unanticipated technical challenges on the membrane cover assemblies, including repairing tears and pin holes in the covers discovered after the covers were removed  The project also had to allot time to install bumpers, which are kapton tubes, to the assembly to protect the composite material on a sunshield structure during launch  The project identified the need to add the bumpers during subassembly vibration testing  As a result, as of November 2018, the project had used about 4 5 weeks of schedule reserves to cover delays associated with these activities  The use of reserves beyond what the project had planned for the repairs pushed the restart of spacecraft element integration and test activities out about a week to November 14, 2018  Figure 6 compares the project’s initial membrane cover assembly schedule in June 2018 to the actual schedule in November 2018  While the project repaired the membrane cover assembly, it also used this time to conduct risk mitigation activities on OTIS  For example, the project worked to mitigate a design issue on the frill connections  The frill is composed of a single layer of blankets placed around the outside of the primary mirror used to block stray light (see figure 7)  A combination of modeling and inspections revealed that most of the frill sections did not have as much slack as expected at the near-absolute zero cryogenic temperatures of space  This caused shrinkage that put stress on the edges of the outer ring of mirrors, which could affect the stability of the optical mirror and image quality  The project loosened these outer connections by adding a ring to the connecting points  As of November 2018, project officials said they were in the process of verifying the fix through inspections  Examples of technical issues and risks that the project continues to face during the remaining phases of integration and test include: The project is working to mitigate a design issue on the sunshield membrane tensioning system—which helps deploy the sunshield and maintain its correct shape  In our February 2018 report, we found that Northrop Grumman was planning to modify the design of the membrane tensioning system after one of the sunshield’s six membrane tensioning systems experienced a snag when conducting folding and deployment exercises on the sunshield in October 2017  The project and Northrop Grumman determined that a design modification was necessary to fully mitigate the issue, which includes modifying clips used to progressively release the cable tension and adding guards to control the excess cable  The project identified a concern that the depressurization of trapped air in the folded sunshield membrane when the fairing separates to release the JWST observatory may overly stress the membrane material  The project is working with Arianespace—the company responsible for operating JWST’s launch vehicle—and experts at the Kennedy Space Center to resolve this concern  Officials estimated that a design solution would be in place in mid-2019  However, if the project determines that it needs to reinforce the membrane covers to survive excessive residual pressure as it works on this design solution, a multi-month schedule delay could occur  As of November 2018, the project has mitigated 21 of its 47 hardware and software risks to acceptable levels, and reviews these risks monthly for any changes that might affect the continued acceptability of the risk  Five of these 21 risks are related to the project’s more than 300 potential single point failures—several of which are related to the deployment of the sunshield  The project is actively working to mitigate the remaining 26 risks to acceptable levels or closure prior to launching  The project also has several first-time and challenging integration and test activities remaining  For example, the project must integrate OTIS and the completed spacecraft element and test the full observatory in the final integration phase, which includes another set of challenging environmental tests  See figure 8 for an image of OTIS and the spacecraft element prior to being integrated  As previously discussed, the project also has two remaining deployments of the sunshield, and prior deployments have taken longer than planned  To help mitigate the risks associated with the deployments, the project added additional time for deployments in the 2018 replanned schedule based on lessons learned from prior deployments  The two remaining deployments are to occur after spacecraft element integration and test and again after observatory integration and test  The JWST project office is required to evaluate whether the project can complete development within its revised cost and schedule commitments at its next major review—the system integration review—planned for August 2019  This review is to occur after the project has completed two major tasks—OTIS and spacecraft element integration and test  The review is to evaluate whether the project (1) is ready to enter observatory integration and test, and (2) can complete remaining project development with acceptable risk and within its cost and schedule constraints  NASA guidance does not require projects to conduct a JCL at this review  However, project officials said that they plan to conduct another schedule risk analysis in the future  They do not intend to complete a new JCL for the same reasons they did not complete one for the 2018 replan— because costs are almost entirely related to the workforce and can be derived from a schedule that takes into account known risk  While not required, conducting a JCL prior to the system integration review would inform NASA about the probability of meeting both its cost and schedule commitments  If the project proceeds with its plan to conduct only a schedule risk analysis, NASA would be provided only with an updated probability of meeting its schedule commitments  Our cost estimating best practices recommend that cost estimates should be updated to reflect changes to a program or kept current as it moves through milestones and as new risks emerge  In addition, government and industry cost and schedule experts we spoke with noted that integration and testing is a critical time for a project when problems can develop  These experts told us that completing a JCL is a best practice for analyzing major risks at the most uncertain part of project execution  Conducting a JCL at system integration review—a review that occurs during the riskiest phase of development, the integration and test phase— would allow the project to update its assumptions of risk and uncertainty based on its experiences in OTIS and spacecraft element integration and test  The project could then determine how those updated assumptions affect overall cost and schedule for the JWST project  As noted above, the project has many risks to mitigate, technical challenges to overcome, and challenging test events to complete, which could affect the project’s schedule and risk posture  Further, the project has an established history of significant cost growth and schedule delays  In its June 2018 letter notifying an appropriate congressional committee of its updated cost and schedule commitments, NASA acknowledged that recent cost growth for the project will likely impact other science missions  Conducting a JCL at system integration review would provide NASA and Congress with critical information for making informed resource decisions on the JWST project and its affordability within NASA’s portfolio of projects more broadly  NASA has taken steps to augment oversight of the contractor and project following the discovery of the embedded design flaws and workmanship errors that contributed to the project’s most recent schedule delays and cost increases  See table 1 for examples of changes NASA has made to contractor and project oversight—some of which NASA self-identified and others that were in response to IRB recommendations  The IRB made 31 recommendations that ranged from improving employee morale to improving security during transporting JWST to its launch site  NASA has also used award fees to try to incentivize Northrop Grumman to improve its performance  In a July 2018 hearing on the JWST program before the House Science, Space, and Technology Committee, Administrator Bridenstine stated that NASA had reduced the available award fee through commissioning by $28 million out of a total of about $60 million  Northrop Grumman also did not earn its full award fee in the two most recent periods of performance that NASA assessed  For the performance period of April 1, 2017 to September 30, 2017, Northrop Grumman earned approximately 56 percent of the available award fee  Reasons that NASA cited for its evaluation of award fees in this period included workmanship errors on the propulsion system, schedule delays, as well as issues with schedule execution, management, and quality control  For the period of October 1, 2017 to March 31, 2018, Northrop Grumman earned none of the available award fee  Northrop Grumman’s overall score was driven by an “unacceptable” rating in schedule and cost due to delays and in anticipation of exceeding the project’s $8 billion cost cap  Northrop Grumman received an “excellent” rating under the technical category, but the evaluation noted ongoing issues with quality controls, which resulted in delays  For example, the process steps for applying voltage to the spacecraft’s pressure transducers were not clear enough, which resulted in technician error and irreparable damage to the hardware  According to Northrop Grumman officials, the contractor has started to take action to try to improve its quality assurance processes  Officials described actions that ranged from rewriting hardware integration and test procedures to starting efforts to change aspects of the company’s culture that contributed to quality control issues  For example, in July 2018, Northrop Grumman initiated a JWST mission assurance culture change campaign to increase focus on product quality and process compliance  This effort includes having inspectors affirm by signature that they have personally inspected, verified, and confirmed that all aspects of an activity meet quality standards  According to the form instructions, if the inspector is uncertain on compliance or if instructions are unclear, workers are to halt work, investigate and assess the situation, and request help to resolve the situation  Project and Northrop Grumman officials provided an example of these changes working  During a manual deployment of a radiator panel, a Northrop Grumman employee discovered that a flap used as thermal protection for a radiator was installed incorrectly and reported the error  Northrop Grumman technicians found that this flap had been swapped with another flap in the process of moving them to be installed and corrected the problem before work proceeded  Further, NASA and Northrop Grumman are conducting audits to try to minimize the risk of failures during the remaining phases of integration and test  These audits are conducted on items that have not been fully tested, are in workmanship-sensitive areas, or have had a late design change  The first phase of the audit was completed in September 2018 and found no major design issues or hardware rework required  The project plans to audit other areas through at least spring 2019, but will add audits if needed  The JWST oversight structure includes a number of positions that could be responsible for ensuring that the recent augmentations to contractor and project oversight are sustained through launch (see table 2)  In response to our review, NASA officials clarified that the project manager has sole responsibility for ensuring that these improvements are sustained through launch  Further, these officials stated that the project office is responsible for monitoring these changes at the project level and at Northrop Grumman  The project manager’s continued focus on these efforts will be important because: The project is implementing a wide span of improvement efforts, ranging from more on-site coverage at the contractor facility to cultural improvements, which will now need to be sustained for an additional 29 months  The project has had recurring issues with effective internal and external communication as well as defining key management and oversight responsibilities, both of which are important to sustaining oversight  For example, the Independent Comprehensive Review Panel identified communication problems—between the JWST project and Science Mission Directorate management as well as between NASA and Northrop Grumman—and that the project’s governance structure lacked clear lines of authority and accountability  In December 2012, we found the JWST project had taken several steps to improve communication—such as instituting meetings that include various levels of NASA, contractor, and subcontractor management— but the IRB’s findings in 2018 indicate that communication and governance issues have resurfaced in some areas  For example, the IRB found that communication with key stakeholders including the science community, Congress, and NASA leadership, has been variable and at times inconsistent  The project may encounter new schedule pressures as it proceeds through integration and test  A senior NASA official with expertise in workmanship issues told us that schedule pressure is a key reason for increased quality problems on projects  For example, this official said that companies tend to give experts leniency to operate without the burden of quality assurance paperwork when schedule pressures arise, which can lead to workmanship errors  While JWST project officials told us they do not view this as applicable to their project, the perspective regarding potential schedule pressures and workmanship is important to keep focus on given the magnitude of technical challenges and delays the project has faced  We will continue to monitor the project’s efforts at maintaining these oversight augmentations in future reviews, given that less than a year has passed since the project began implementing many of them  Moreover, the project may find that some actions will be required of officials outside the project, particularly since the communication problems identified by the IRB may well extend to headquarters’ interaction with stakeholders from the science community, industry, and the Congress  JWST is one of NASA’s most expensive and complex science projects, and NASA has invested considerable time and resources on it  The project first established its cost and schedule baseline in 2009  Since then, the project made progress by completing two of five phases of integration and test, but has also experienced significant cost growth and schedule delays  However, the project did not complete a JCL analysis as part of its second replan  Between now and its system integration review planned for August 2019, the JWST program will have to continue to address technical challenges and mitigate risks  Conducting a JCL would better inform decision makers on the status of the project as they determine whether the project can complete remaining project development with acceptable risk and within its cost and schedule constraints  Given the project is now on its third iteration of cost and schedule commitments, conducting a JCL is a small step that NASA can take to demonstrate it is on track to meet these new commitments  We are making the following recommendation to NASA: The NASA Administrator should direct the JWST project office to conduct a JCL prior to its system integration review  (Recommendation 1) We provided a draft of this report to NASA for comment  In written comments, NASA agreed with our recommendation  NASA expects to complete the JCL by September 2019, prior to the system integration review  The comments are reprinted in appendix II  NASA also provided technical comments, which have been addressed in the report, as appropriate  We are sending copies of this report to the appropriate congressional committees, the NASA Administrator, and other interested parties  In addition, the report is available at no charge on the GAO website at http://www gao gov  If you or your staff have any questions on matters discussed in this report, please contact me at (202) 512-4841 or chaplainc@gao gov  Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this report  GAO staff who made key contributions to this report are listed in appendix III  In addition to the contact named above, Molly Traci (Assistant Director), Karen Richey (Assistant Director), Jay Tallon (Assistant Director), Brian Bothwell, Daniel Emirkhanian, Laura Greifner, Erin Kennedy, Jose Ramos, Sylvia Schatz, Roxanna Sun, and Alyssa Weir made key contributions to this report 
Report 2:  The national limits were set at a percentage (74%) of the median of all local fee schedule amounts for each laboratory test code; therefore, fee schedule amounts may differ by region  In general, annual increases in clinical lab fees have been based on the percentage change in the CPI-U  However, since 1987, Congress has specified lower updates  Beginning in 2014, with certain exceptions, laboratory tests provided in hospital outpatient departments are no longer paid separately under the CLFS and are instead included in the OPPS payments  PAMA introduced a new method for determining clinical laboratory payments and required CMS to base Medicare CLFS reimbursement on reported private insurance payment amounts  Medicare has been using weighted median private insurer rates to calculate Medicare payment rates for laboratory tests paid under the CLFS since January 1, 2018  These payment rates are national and do not vary by geographic area  Part B also covers diagnostic nonlaboratory x-ray tests and other diagnostic tests, as well as x-ray, radium, and radioisotope therapy  Generally, these services are paid for under the physician fee schedule, with beneficiaries responsible for a 20% coinsurance payment  Medicare covers a wide variety of equipment and devices under the heading of durable medical equipment (DME), prosthetics, and orthotics (PO) if they are medically necessary and are prescribed by a physician  DME is defined as equipment that (1) can withstand repeated use, (2) has an expected life of at least three years (effective for items classified as DME after January 1, 2012), (3) is used primarily to serve a medical purpose, (4) is not generally useful in the absence of an illness or injury, and (5) is appropriate for use in the home  DME includes such items as hospital beds, wheelchairs, blood glucose monitors, and oxygen and oxygen equipment  It also includes related supplies (S), such as drugs and biologics that are necessary for the effective use of the product  Prosthetics (P) are items that replace all or part of a body organ or its function, such as colostomy bags, pacemakers, and artificial eyes, arms, or legs  Orthotics (O) are braces that support a weak or deformed body member, such as leg or back braces  Except in competitive bidding areas (CBAs, described below), Medicare pays for most durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) based on fee schedules  Medicare pays 80% of the lower of the supplier's charge for the item or the fee schedule amount  The beneficiary is responsible for the remaining 20%  In general, fee schedule amounts are updated each year by a (1) measure of price inflation, and (2) a measure of economy-wide productivity, which may result in lower fee schedule amounts from one year to the next  Since 2016, the fee schedule rates that applied outside of competitive bidding areas for certain DMEPOS have been reduced based on price information from the competitive bidding program  The reductions were phased in during 2016, and fully phased in starting in January 2017  In response to concerns that the adjusted rates were too low, the Secretary again applied the phase-in rate for rural and noncontiguous areas not subject to competitive bidding starting in June 2018  Currently, two different fee schedules apply outside of CBAs  First, in rural or noncontiguous areas, the fee schedule is a 50/50 blend of the fee schedule with and without the reductions based on information from competitive bidding (i e , the phase-in methodology)  Second, in nonrural and contiguous areas, the fee schedule amounts are fully adjusted by information from the competitive bidding program  Numerous studies and investigations indicated that Medicare paid more for certain items of DME and PO than some other health insurers and some retail outlets  Such overpayments were attributed, in part, to the fee schedule mechanism of payment  MMA required the Secretary to establish a Competitive Acquisition Program for certain DMEPOS in specified areas  Instead of paying for medical equipment based on a fee schedule established by law, payment for items in competitive bidding areas was based on the supplier bids  The program started in 9 metropolitan areas in January 2011 and had expanded to 130 competitive bidding areas in 2018  However, the program has been suspended while a new bidding methodology is established  During the gap, the payments for previously competitively bid items in competitive bidding areas will be the amounts that applied on December 31, 2018, increased, yearly, by a measure of inflation  Certain specified outpatient prescription drugs and biologics are covered under Medicare Part B  (However, most outpatient prescription drugs are covered under Part D, discussed below ) Covered Part B drugs and biologics include drugs furnished incident to physician services, immunosuppressive drugs following a Medicare-covered organ transplant, erythropoietin for treatment of anemia for individuals with ESRD when not part of the ESRD composite rate, oral anticancer drugs (provided they have the same active ingredients and are used for the same indications as chemotherapy drugs that would be covered if furnished incident to physician services), certain vaccines under selected conditions, and drugs administered through DME  Generally, Medicare reimburses physicians and other providers, such as hospital outpatient clinics, for covered Part B drugs and biologics at 106% of the volume weighted average sales price of all drugs billed under the same billing code, although some Part B drugs, such as those administered through DME, are reimbursed at 95% of the drug's average wholesale price  Health care providers also are paid separately for administering Medicare Part B drugs  Medicare pays 80% of the amount paid to providers, and beneficiaries are responsible for the remaining 20%  A hospital outpatient is a person who has not been admitted by the hospital as an inpatient but is registered on the hospital records as an outpatient  Generally, payments under the hospital outpatient prospective payment system (OPPS) cover the operating and capital-related costs that are directly related and integral to performing a procedure or furnishing a service on an outpatient basis  These payments cover services such as the use of an operating suite, treatment, procedure, or recovery room; use of an observation bed as well as anesthesia; certain drugs or pharmaceuticals; incidental services; and other necessary or implantable supplies or services  Payments for services such as those provided by physicians and other professionals as well as therapy and clinical diagnostic laboratory services, among others, are separate  Under the OPPS, the unit of payment for acute care hospitals is the individual service or procedure as assigned to an ambulatory payment classification (APC)  To the extent possible, integral services and items (excluding physician services paid under the physician fee schedule) are bundled within each APC  Specified new technologies are assigned to "new technology APCs" until clinical and cost data are available to permit assignment into a "clinical APC " Medicare's hospital outpatient payment is calculated by multiplying the relative weight associated with an APC by a conversion factor  For most APCs, 60% of the conversion factor is geographically adjusted by the wage index used for the inpatient prospective payment system  Except for new technology APCs, each APC has a relative weight that is based on the median cost of services in that APC  The OPPS also includes pass-through payments for new technologies (specific drugs, biologicals, and devices) and payments for outliers  The Medicare Payment Advisory Commission (MedPAC) has recommended site-neutral payment policies that base payments on the resources needed to provide high-quality care in the most efficient setting  The Bipartisan Budget Act of 2015 (BBA 15; P L  114-74 ) gave CMS the authority to add new restrictions on Medicare payments for services furnished in provider-based off-campus hospital outpatient departments (HOPDs) to address discrepancies between payments under the MPFS and the OPPS for similar services  In its 2019 OPPS Final Rule, CMS explicitly applies the site-neutral policy to clinic visits, the most commonly billed service in hospital outpatient departments  An ambulatory surgical center (ASC) is a distinct entity that furnishes outpatient surgical procedures to patients who do not require an overnight stay after the procedure  According to MedPAC, most ASCs are freestanding facilities rather than part of a larger facility, such as a hospital  Medicare covers surgical and medical services performed in an ambulatory surgical center that are (1) commonly performed on an inpatient basis but may be safely performed in an ASC; (2) not of a type that are commonly performed or that may be safely performed in physicians' offices; (3) limited to procedures requiring a dedicated operating room or suite and generally requiring a postoperative recovery room or short-term (not overnight) convalescent room; and (4) not otherwise excluded from Medicare coverage  Medicare pays for surgery-related facility services provided in ASCs using a prospective payment system based on the OPPS  (Associated physician fees are paid for separately under the physician fee schedule ) Each of the approximately 3,500 procedures approved for payment in an ASC is classified into an APC group on the basis of clinical and cost similarity  The ASC system primarily uses the same payment groups as the OPPS; however, ASC payment rates are generally lower  The ASC weights are scaled (reduced) to account for the different mix of services in an ASC, and the ASC conversion factor (the base payment amount) is lower  A different payment method is used to set ASC payment for office-based procedures, separately payable radiology services, separately payable drugs, and device-intensive procedures  In addition, separate payments are made for certain ancillary items and services when they are integral to surgical procedures, including corneal tissue acquisition, brachytherapy sources, certain radiology services, many drugs, and certain implantable devices  The application of the site-neutral payment policy to clinic visits also affects such payments to ASCs (see discussion above)  Medicare Part B covers emergency and nonemergency ambulance services to or from a hospital, a critical access hospital, a skilled nursing facility, or a dialysis facility for End-Stage Renal Disease (ESRD) beneficiaries who require dialysis when other modes of transportation could endanger the Medicare beneficiary's health  In most cases, the program covers 80% of the allowed amount for the service, and the beneficiary is responsible for the remaining 20%  Generally, ambulance services are covered if (1) transportation of the beneficiary occurs; (2) the beneficiary is taken to an appropriate location (generally, the closest appropriate facility); (3) the ambulance service is medically necessary (other forms of transportation are contraindicated); (4) the ambulance provider or supplier meets state licensing requirements; and (5) the transportation is not part of a Medicare Part A covered stay  Medicare covers both scheduled and nonscheduled nonemergency transports if the beneficiary is bed-confined or meets other medical necessity criteria  Medicare may also cover emergency ambulance transportation by airplane or helicopter if the beneficiary's location is not easily reached by ground transportation or if long distance or obstacles, such as heavy traffic, would prevent the individual from obtaining needed care  Medicare pays for ambulance services according to a national fee schedule  The fee schedule establishes seven categories of ground ambulance services and two categories of air ambulance services  Medicare pays for different levels of ambulance services, which reflect the staff training and equipment required to meet the patient's medical condition or health needs  Generally, basic life support is provided by emergency medical technicians (EMTs)  Advanced life support is provided by EMTs with advanced training or by paramedics  Some rural ground and air ambulance services may qualify for increased payments  Also, ambulance providers that are CAHs, or that are entities that are owned and operated by a CAH, are paid on a reasonable-cost basis rather than the fee schedule if they are the only ambulance provider within a 35-mile radius  Medicare covers Part B services in rural health clinics (RHCs) and federally qualified health centers (FQHCs) provided by (1) physicians and specified nonphysician practitioners; (2) visiting nurses for homebound patients in home health shortage areas; (3) registered dieticians or nutritional professionals for diabetes training and medical nutrition therapy; and (4) others, as well as certain drugs administered by a physician or nonphysician practitioner  RHCs are paid based on an "all-inclusive" cost-based rate per beneficiary visit subject to a per visit upper limit, adjusted annually for inflation  For cost-reporting periods that began on or after October 1, 2014, FQHCs are paid a base payment rate per visit (with a limit, in most cases, of one billable visit per day) under a PPS methodology  Each FQHC's PPS rate is adjusted based on the location where the service is furnished using geographic adjustment factors, which are the geographic practice cost indices (GPCI) used in Medicare's physician fee schedule (MPFS)  This rate is increased by 34% for new patients (those not seen in the FQHC organization within the past three years)  The 34% increase also applies when a beneficiary receives a comprehensive initial Medicare visit (an initial preventive physician examination or an initial annual wellness visit) or a subsequent annual wellness visit  Effective January 1, 2017, the FQHC PPS base rate is updated annually using an FQHC-specific market basket  Medicare's payment to the FQHC is equal to 80% of the lesser of the adjusted PPS rate or the FQHC's actual charges associated with the visit, and the beneficiary is responsible for a 20% coinsurance  Medicare Advantage (MA) is an alternative way for Medicare beneficiaries to receive covered benefits  Under MA, private health plans are paid a per-person amount to provide all Medicare covered benefits (except hospice) to beneficiaries who enroll in their plan  Medicare beneficiaries who are eligible for Part A, enrolled in Part B, and do not have ESRD are eligible to enroll in an MA plan if one is available in their area  Some MA plans may choose their service area (local MA plans), while others agree to serve one or more regions defined by the Secretary (regional MA plans)  In 2019, nearly all Medicare beneficiaries have access to an MA plan and approximately a third of beneficiaries are enrolled in one  Private plans may use different techniques to influence the medical care used by enrollees  Some plans, such as health maintenance organizations (HMOs), may require enrollees to receive care from a restricted network of medical providers; enrollees may be required to see a primary care physician who will coordinate their care and refer them to specialists as necessary  Other types of private plans, such as private fee-for-service (PFFS) plans, may look more like original Medicare, with fewer restrictions on the providers an enrollee can see and minimal coordination of care  In general, MA plans offer additional benefits or require smaller co-payments or deductibles than original Medicare  Sometimes beneficiaries pay for these additional benefits through a higher monthly premium, but sometimes they are financed through plan savings  The extent of extra benefits and reduced cost sharing varies by plan type and geography  However, MA plans are seen by some beneficiaries as an attractive alternative to more expensive supplemental insurance policies found in the private market  By contract with CMS, a plan agrees to provide all required services covered in return for a capitated monthly payment adjusted for the demographics and health history of their enrollees  The same monthly payment is made regardless of how many or few services a beneficiary actually uses  In general, the plan is at-risk if costs, in the aggregate, exceed program payments; conversely, the plan can retain savings if aggregate costs are less than payments  Payments to MA plans are based on a comparison of each plan's estimated cost of providing Medicare covered services (a bid) relative to the maximum amount the federal government will pay for providing those services in the plan's service area (a benchmark)  If a plan's bid is less than the benchmark, its payment equals its bid plus a rebate  The size of the rebate is dependent on plan quality and ranges from 50% to 70% of the difference between the bid and the benchmark  The rebate must be returned to enrollees in the form of additional benefits, reduced cost sharing, reduced Part B or Part D premiums, or some combination of these options  If a plan's bid is equal to or above the benchmark, its payment will be the benchmark amount and each enrollee in that plan will pay an additional premium, equal to the amount by which the bid exceeds the benchmark  The MA benchmarks are determined through statutorily specified formulas that have changed over time  Since BBA 97, formulas have increased the benchmark amounts, in part, to encourage plan participation in all areas of the country  As a result, however, the benchmark amounts (and plan payments) in some areas have been higher than the average cost of original FFS Medicare  The ACA changed the way benchmarks are calculated by tying them closer to (or below) spending in FFS Medicare, and adjusting them based on plan quality  In a recent analysis, MedPAC found that "over the past few years, plan bids and payments have come down in relation to FFS spending while MA enrollment continues to grow  The pressure of lower benchmarks has led to improved efficiencies and more competitive bids that enable MA plans to continue to increase enrollment by offering benefits that beneficiaries find attractive " In 2006, the MA program began to offer MA regional plans  Regional MA plans must agree to serve one or more regions designated by the Secretary  There are 26 MA regions consisting of states or groups of states  Regional plan benchmarks include two components: (1) a statutorily determined amount (comparable to benchmarks described above) and (2) a weighted average of plan bids  Thus, a portion of the benchmark is competitively determined  Similar to local plans, plans with bids below the benchmark are given a rebate, while plans with bids above the benchmark require an additional enrollee premium  In general, MA eligible individuals may enroll in any MA plan that serves their area  However, some MA plans may restrict their enrollment to beneficiaries who meet additional criteria  For example, employer-sponsored MA plans are generally only available to the retirees of the company sponsoring the plan  In addition, Medicare Special Needs Plans (SNPs) are a type of coordinated care MA plan that exclusively enrolls, or enrolls a disproportionate percentage of, special needs individuals  Special needs individuals are any MA eligible individuals who are either institutionalized as defined by the Secretary, eligible for both Medicare and Medicaid, or have a severe or disabling chronic condition and would benefit from enrollment in a specialized MA plan  Medicare Part D provides coverage of outpatient prescription drugs to Medicare beneficiaries who choose to enroll in this optional benefit  (As previously discussed, Part B provides limited coverage of some outpatient prescription drugs ) In 2019, about 47 million (about 77%) of eligible Medicare beneficiaries are estimated to be enrolled in a Part D plan  Prescription drug coverage is provided through private prescription drug plans (PDPs), which offer only prescription drug coverage, or through Medicare Advantage prescription drug plans (MA-PDs), which offer prescription drug coverage that is integrated with the health care coverage they provide to Medicare beneficiaries under Part C  Plans must meet certain minimum requirements; however, there are significant variations among them in benefit design, including differences in premiums, drugs included on plan formularies, and cost sharing for particular drugs  Part D prescription drug plans are required to offer either "standard coverage" or alternative coverage that has actuarially equivalent benefits  In 2019, "standard coverage" has a $415 deductible and a 25% coinsurance for costs between $415 and $3,820  From this point, there is reduced coverage until the beneficiary has out-of-pocket costs of $5,100 (an estimated $8,139 54 in total spending); this coverage gap has been labeled the "doughnut hole " Once the beneficiary reaches the catastrophic limit, the program pays all costs except for the greater of 5% coinsurance or $3 40 for a generic drug and $8 50 for a brand-name drug  As required by the ACA, in 2010, Medicare sent a tax-free, one-time $250 rebate check to each Part D enrollee who reached the doughnut hole  Additionally, starting in 2011, the coverage gap is being gradually reduced each year  Under the ACA, the coverage gap for both brand-name and generic drugs was to be eliminated in 2020, but Congress moved up the date to 2019 for brand-name drugs as part of BBA 18  In 2019, a 70% discount is provided by drug manufacturers and Medicare pays an additional 5% of the cost of brand-name drugs dispensed during the coverage gap  In 2019, Medicare also pays 63% of the cost of generic drugs dispensed during the coverage gap and enrollees pay 37%  (See Figure 2  ) By 2020, through a combination of manufacturer discounts and increased Medicare coverage, Part D enrollees will be responsible for 25% of the costs for brand-name and generic drugs in the coverage gap (the same as during the initial coverage period)  Most plans offer actuarially equivalent benefits rather than the standard package, including alternatives such as reducing or eliminating the deductible, or using tiered cost sharing with lower cost sharing for generic drugs  Medicare's payments to plans are determined through a competitive bidding process, and enrollee premiums are tied to plan bids  Plans are paid a risk-adjusted monthly per capita amount based on their bids during a given plan year  Part D plan sponsors determine payments for drugs and are expected to negotiate prices  The federal government is prohibited from interfering in the price negotiations between drug manufacturers, pharmacies, and plans (the so-called "non-interference clause")  Part D also provides enhanced coverage for low-income enrolled individuals, such as persons who previously received drug benefits under Medicaid (known as "dual eligibles"—enrollees in both Medicare and Medicaid)  Additionally, certain persons who do not qualify for Medicaid, but whose incomes are below 150% of poverty, may also receive assistance for some portion of their premium and cost-sharing charges  The MMA included significant incentives for employers to continue to offer coverage to their retirees by providing a 28% federal subsidy  In 2019, the maximum potential subsidy per covered retiree is $2,264 for employers or unions offering drug coverage that is at least actuarially equivalent (called "creditable" coverage) to standard coverage  Employers or unions may select an alternative option (instead of taking the subsidy) with respect to Part D, such as electing to pay a portion of the Part D premiums  They may also elect to provide enhanced coverage, though this has some financial consequences for the employer or union  Alternatively, employers or unions may contract with a PDP or MA-PD to offer the coverage or become a Part D plan sponsor themselves for their retirees  A variety of public and private entities are involved in carrying out Medicare administrative and oversight functions  CMS, an agency within HHS, has primary operational responsibilities  Such responsibilities include managing program finances, developing policies and regulations, setting payment rates, and developing the program's information-technology infrastructure  CMS conducts its activities through its headquarters and 10 regional offices  The Social Security Administration, however, enrolls beneficiaries into the program and issues Medicare beneficiary cards  CMS also contracts with various private entities, including private health insurance companies, to help administer the program  For example, Medicare Administrative Contractors (MACs) process and pay Parts A and B reimbursement claims, enroll providers and suppliers, educate providers and suppliers on billing requirements, support appeal processes, and answer provider and supplier inquiries through call centers, as well as other activities  Qualified Independent Contractors (QICs) perform second-level reviews on appeals initially reviewed by MACs  Medicare's quality assurance activities are primarily handled by State Survey Agencies and Quality Improvement Organizations (QIOs), which operate in all states and the District of Columbia, Puerto Rico, and the U S  Virgin Islands  The State Survey Agencies are responsible for inspecting Medicare provider facilities (e g , nursing homes, home health agencies, and hospitals) to ensure that they are in compliance with federal safety and quality standards referred to as Conditions (or Requirements) of Participation  Alternatively, some types of providers, including hospitals, may receive certification through private accrediting agencies, such as the Joint Commission  QIOs are mostly private, not-for-profit organizations that monitor the quality of care delivered to Medicare beneficiaries and educate providers on the latest quality-improvement techniques  Medicare program integrity activities, such as audits, provider education, medical review, and predictive data analysis, also are carried out by a variety of government and private entities  For example, the Center for Program Integrity within CMS works together with the U S  Department of Justice (DOJ) and the HHS Office of Inspector General (OIG) to identify and prevent fraud, waste, and abuse in Medicare  CMS also works with private contractors to carry out certain program-integrity functions  Unified Program Integrity Contractors (UPICs) perform integrity-related activities including data analysis to identify potentially fraudulent claims (bills) for Medicare Parts A and B, home health and hospice services, and DME  Similarly, the National Benefit Integrity Medicare Drug Integrity Contractor (MEDIC) is responsible for identifying and investigating fraud, waste, and abuse in Medicare Advantage and Part D  When appropriate, the UPICs and MEDIC work with and refer cases to law enforcement, including OIG and DOJ  In addition, Recovery Audit Contractors (RACs) are responsible for identifying improper Medicare payments, including both underpayments and overpayments, and for recouping any overpayments made to providers  Each year, the Comprehensive Error Rate Testing (CERT) program quantifies a national improper Medicare payment rate by examining a random sample of claims  In turn, the Supplemental Medical Review Contractor targets medical reviews in areas where OIG, RACs, and CERT have identified vulnerabilities and/or questionable billing patterns to identify ways to lower improper payment rates  As required by the ACA, the Center for Medicare and Medicaid Innovation (CMMI) was established in January 2011 to test and evaluate innovative payment and service delivery models to reduce program expenditures under Medicare  Examples of these models include providing payment incentives for groups of doctors, hospitals, and other health care providers (Accountable Care Organizations, or ACOs) to coordinate the services they provide to Medicare beneficiaries; bundling payments for services provided in different settings during a beneficiary's episode of care; and reimbursing health providers based on the quality of care rather than on the volume of services  CMMI also plays an important role in developing and implementing the new physician payment models required by MACRA  Medicare beneficiary education and outreach duties are shared between CMS and the Social Security Administration  Each year, CMS mails out a "Medicare and You" handbook to beneficiaries, which provides information on their benefits for the upcoming year  Additional educational materials and responses to frequently asked questions may be found on the CMS-maintained "Medicare gov" website, and beneficiaries may call a CMS-operated 1-800 number for assistance with specific questions and help with selecting and enrolling in a Medicare Advantage and/or Part D plan  A Medicare beneficiary ombudsman is also available to provide assistance to Medicare consumers with their complaints, grievances, and requests  The Social Security Administration is responsible for notifying low-income Medicare beneficiaries about programs that may be able to assist them with their medical and prescription drug expenses  The Social Security Administration also provides general Medicare eligibility and enrollment information on its webpage and on Social Security benefit statements  Finally, CMS partners with community-based organizations, such as State Health Insurance Assistance Programs, in every state to provide educational resources and personalized assistance to Medicare beneficiaries  Medicare's financial operations are accounted for through two trust funds maintained by the Department of the Treasury—the Hospital Insurance (HI) trust fund for Part A and the Supplementary Medical Insurance (SMI) trust fund for Parts B and D  For beneficiaries enrolled in Medicare Advantage (Part C), payments are made on their behalf in appropriate portions from the HI and SMI trust funds  HI is primarily funded by payroll taxes, while SMI is primarily funded through general revenue transfers and premiums  (See Figure 3  ) The HI and SMI trust funds are overseen by a Board of Trustees that provides annual reports to Congress  The trust funds are accounting mechanisms  Income to the trust funds is credited to the fund in the form of interest-bearing government securities  Expenditures for services and administrative costs are recorded against the fund  These securities represent obligations that the government has issued to itself  As long as a trust fund has a balance, the Department of the Treasury is authorized to make payments for it from the U S  Treasury  Medicare expenditures are primarily paid for through mandatory spending—generally Medicare pays for all covered health care services provided to beneficiaries  Aside from certain constraints in HI described below, the program is not subject to spending limits  Additionally, most Medicare expenditures (aside from premiums paid by beneficiaries) are paid for by current workers through income taxes and dedicated Medicare payroll taxes, that is, current income is used to pay current expenditures  Medicare taxes paid by current workers are not set aside to cover their future Medicare expenses  The primary source of funding for Part A is payroll taxes paid by employees and employers  Each pays a tax of 1 45% on the employee's earnings; the self-employed pay 2 9%  Beginning in 2013, some higher-income employees pay higher payroll taxes  Unlike Social Security, there is no upper limit on earnings subject to the tax  Other sources of income include (1) interest on federal securities held by the trust fund, (2) a portion of federal income taxes that individuals pay on their Social Security benefits, and (3) premiums paid by voluntary enrollees who are not automatically entitled to Medicare Part A  Income for Part A is credited to the HI trust fund  Part A expenditures for CY2019 are estimated to reach approximately $330 billion  Revenue to the trust fund is expected to consist of about $285 billion in payroll tax income and another $38 billion in interest and other income  The Medicare Trustees project that in CY2019, the HI trust fund will incur a deficit of approximately $7 billion  As long as the HI trust fund has a balance, the Treasury Department is authorized to make payments for Medicare Part A services  To date, the HI trust fund has never run out of money (i e , become insolvent), and there are no provisions in the Social Security Act that govern what would happen if that were to occur  Part A expenditures exceeded HI income each year from 2008 through 2015, and the assets credited to the trust fund were drawn down to make up the deficit in those years  Although the HI trust fund accumulated small surpluses in 2016 and 2017, the Medicare Trustees estimate that, beginning in 2018, expenditures will outpace income in all future years, and project that the HI trust fund will become insolvent in 2026 (i e , the balance of the trust fund will reach $0)  At that time there would no longer be sufficient funds to fully cover Part A expenditures  Medicare Part B is financed primarily from federal general revenues and from beneficiary premiums, which are set at 25% of estimated per capita program costs for the aged  (The disabled pay the same premium as the aged ) Income for Part B is credited to the SMI trust fund  Total spending for Part B is estimated to reach about $368 billion in CY2019, with premiums financing about $98 billion of that amount and general revenues financing most of the rest  Most beneficiaries who enroll in Medicare Part B pay a monthly premium  Individuals receiving Social Security benefits have their Part B premium payments automatically deducted from their Social Security benefit checks  Due to a "hold-harmless" provision in the Social Security Act, an individual's Social Security check cannot decrease from one year to the next as a result of the annual Part B premium increase (except in the case of higher-income individuals subject to income-related premiums)  The 2019 monthly Part B premium is $135 50  However, about 3 5% of Medicare enrollees are protected by the hold-harmless provision and pay lower premium amounts because the dollar amount of the 2019 cost-of-living increase in their Social Security benefits was not sufficient to cover the full premium increase  Since 2007, higher-income Part B enrollees have paid higher premiums  In 2019, individuals whose modified adjusted gross income (AGI) exceeds $85,000 and each member of a couple filing jointly whose modified AGI exceeds $170,000 are subject to higher premium amounts  These higher-income premiums range from 35% to 85% of the value of Part B and affect about 5% of Medicare enrollees  (See Appendix B for 2019 Part B premiums and high-income thresholds ) Payments for spending under the Medicare Advantage program are made in appropriate portions from the HI and SMI trust funds  There is no separate trust fund for Part C  Medicare Part D is financed through a combination of beneficiary premiums and federal general revenues  In addition, certain transfers are made from the states  These transfers, referred to as "clawback payments," represent a portion of the amounts states could otherwise have been expected to pay for drugs under Medicaid if drug coverage for the dual eligible population had not been transferred to Part D  Part D revenues are credited to a separate Part D account within the SMI trust fund  In CY2019, total spending for Part D is estimated to reach approximately $98 billion, with about $71 billion of that amount paid for by general revenues, $16 billion from beneficiary premiums, and $12 billion from state transfers  In 2019, the base beneficiary premium is $33 19; however, beneficiaries pay different premiums depending on the plan they have selected and whether they are entitled to low-income premium subsidies  Additionally, beginning in 2011, higher income Part D enrollees pay higher premiums  (The income thresholds are the same as for Part B, as described above ) On average, beneficiary premiums are set at 25 5% of expected total Part D costs for basic coverage  The Budget Control Act of 2011 (BCA; P L  112-25 ) provided for increases in the debt limit and established procedures designed to reduce the federal budget deficit, including the creation of a Joint Select Committee on Deficit Reduction  The failure of the Joint Committee to propose deficit reduction legislation by its mandated deadline triggered automatic spending reductions ("sequestration" of mandatory spending and reductions in discretionary spending) in fiscal years 2013 through 2021  The American Taxpayer Relief Act of 2012 (ATRA; P L  112-240 ) delayed the automatic reductions by two months, while the Bipartisan Budget Act of 2013 (BBA; P L  113-67 ) extended sequestration for mandatory spending for an additional two years—through FY2023  In 2014, the President signed into law an amended version of S  25 ( P L  113-82 ), which included a provision to extend BCA's sequester of mandatory spending through FY2024  BBA 15 extended the sequestration of mandatory spending another year, through FY2025  Most recently, BBA 18 extended the BCA mandatory spending sequester through FY2027  Section 256(d) of the Balanced Budget and Emergency Deficit Control Act of 1985 (BBEDCA; P L  99-177 ) contains special rules for the Medicare program in the event of a sequestration  Among other things, it specifies that for Medicare, sequestration is to begin the month after the sequestration order has been issued  Therefore, as the sequestration order was issued March 2013, Medicare sequestration began April 1, 2013, and will continue through March 31, 2028  Under sequestration, Medicare's benefit structure generally remains unchanged; however, benefit related payments are subject to 2% reductions  In other words, most Medicare payments to health care providers, as well as to MA and Part D plans, are being reduced by 2%  Certain Medicare payments are exempt from sequestration and therefore not reduced  These exemptions include (1) Part D low-income subsidies, (2) the Part D catastrophic subsidy, and (3) Qualified Individual (QI) premiums  Some non-benefit related Medicare expenses, such as administrative and operational spending, are subject to higher reductions, 6 2% in 2019  While Medicare provides broad protection against the costs of many, primarily acute care, services, the program does not cover all services that may be used by its aged and disabled beneficiaries  In general, Medicare does not cover eyeglasses, hearing aids, dentures, or most long-term care services  Further, unlike most private insurance policies, it does not include an annual "catastrophic" cap on out-of-pocket spending on cost-sharing charges for services covered under Parts A and B (except for persons enrolled in Medicare Advantage plans)  Most Medicare beneficiaries have some coverage in addition to Medicare  The following are the main sources of additional coverage for Medicare enrollees: Medicare Advantage  Many MA plans offer services in addition to those covered under original Medicare, reduced cost sharing, or reduced Part B or D premiums  All MA plans have a catastrophic cap  Employer Coverage  Coverage may be provided through a current or former employer  In recent years, a number of employers have cut back on the scope of retiree coverage  Some have dropped such coverage entirely, particularly for future retirees  As noted earlier, the MMA attempted to stem this trend, at least for prescription drug coverage, by offering subsidies to employers who offer drug coverage, at least as good as that available under Part D  Medigap  Individual insurance policies that supplement fee-for-service Medicare are referred to as Medigap policies  Beneficiaries with Medigap insurance typically have coverage for a portion of Medicare's deductibles and coinsurance; they may also have coverage for some items and services not covered by Medicare  Individuals select from a set of standardized plans, though not all plans are offered in all states  Medicaid  Certain low-income Medicare beneficiaries also may be eligible for full or partial benefits under their state's Medicaid program  Individuals eligible for both Medicare and Medicaid are referred to as dual eligibles  The lowest-income dual eligibles qualify for full Medicaid benefits, so that the majority of their health care expenses are paid by either Medicare or Medicaid; Medicare pays first, with Medicaid picking up most of the remaining costs  In addition to full-benefit dual eligibles, state Medicaid programs pay Medicare premiums and some cost sharing for other partial dual eligibles, who have higher income than full-benefit dual eligibles but are still considered to have low income  Other Public Sources  Individuals may have additional coverage through the Department of Veterans Affairs, or TRICARE for military retirees eligible for Medicare (and enrolled in Part B)  In 2015, about 87% of Medicare beneficiaries had some form of additional coverage  Some persons may have had more than one type of additional coverage  Appendix A  Abbreviations Appendix B  2019 Medicare Beneficiary Costs

ground_truth: JWST, a large, deployable telescope, is one of NASA's most complex projects and top priorities. The project has delayed its planned launch three times since September 2017 due to problems discovered in testing. In June 2018, NASA approved new cost and schedule estimates for JWST. Since the project established its cost and schedule baselines in 2009, the project's costs have increased by 95 percent and the launch date has been moved back by 81 months. Conference Report No. 112-284, accompanying the Consolidated and Further Continuing Appropriations Act, 2012, included a provision for GAO to assess the project annually and report on its progress. This is the seventh report. This report assesses (1) the considerations NASA took into account when updating the project's cost and schedule commitments and (2) the extent to which NASA has taken steps to improve oversight and performance of JWST, among other issues. GAO reviewed relevant NASA policies, analyzed NASA and contractor data, and interviewed NASA and contractor officials. In June 2018, the National Aeronautics and Space Administration (NASA) revised the cost and schedule commitments for the James Webb Space Telescope (JWST) to reflect known technical challenges, as well as provide additional time to address unanticipated challenges. For example, the revised launch readiness date of March 2021 included 5.5 months to address a design issue for the cover of the sunshield (see image). The purpose of the sunshield is to protect the telescope's mirrors and instruments from the sun's heat. NASA found that hardware on the cover came loose during testing in April 2018. The new cost estimate of $9.7 billion is driven by the schedule extension, which requires keeping the contractor's workforce on board longer than expected. Before the project enters its final phase of integration and test, it must conduct a review to determine if it can launch within its cost and schedule commitments. As part of this review, the project is not required to update its joint cost and schedule confidence level analysis—an analysis that provides the probability the project can meet its cost and schedule commitments—but government and industry cost and schedule experts have found it is a best practice to do so. Such analysis would provide NASA officials with better information to support decisions on allocating resources, especially in light of the project's recent cost and schedule growth. NASA has taken steps to improve oversight and performance of JWST, and identified the JWST project manager as responsible for monitoring the continued implementation of these changes. Examples of recent changes include increasing on-site presence at the contractor facility and conducting comprehensive audits of design processes. Sustaining focus on these changes through launch will be important if schedule pressures arise later and because of past challenges with communications. GAO will follow up on the project's monitoring of these improvements in future reviews. GAO recommends NASA update the project's joint cost and schedule confidence level analysis. NASA concurred with the recommendation made in this report.