Summary: GAO reviewed the purchase of eyeglasses for Medicaid recipients in California, Idaho, Oregon, and Washington, as well as New York City's attempt to contract for the purchase of Medicaid clinical laboratory services. Under the Medicaid program, reimbursement procedures for medical supplies are set forth in the individual state plans, which vary in the types and amounts of services and funds provided. Reimbursements for optometric services are based on determined maximum reimbursement rates or the providers' usual and customary charges in California, Idaho, and Oregon. California paid $7,246,000 for calendar year 1976; Idaho paid about $76,712; and Oregon paid about $283,632. Washington switched to bid contracting for purchasing eyeglasses and saved about $96,000 in 1976. Washington also saved money by lending and reusing durable equipment such as wheelchairs. New York City attempts to contract for laboratory services are being enjoined by a coalition of clinical laboratories on the grounds that the contract would impair the recipient's right to freedom of choice. The solicitation would have represented about $5 million in annual savings. Federal regulations have been drafted to provide that reimbursement will be based on the lowest charge level for the area. There is a need for more specific legislation, especially in regard to the freedom-of-choice provisions.
