ALL GAO FIELD OFFICES NOW HAVE COMPUTER EXPERTS TO ASSIST WITH AUDITS. IN A REVIEW OF MEDICAID ELIGIBILITY AUDITORS FOUND THAT HOSPITAL INVOICES INTENDED FOR STATE AND LOCAL PROGRAMS WERE BEING CHARGED TO THE FEDERALLY REIMBURSABLE PROGRAM. AN EXAMINATION OF CASE HISTORIES REVEALED THAT MANY CLAIMS OF RECIPIENTS UNDER 65 WHO WERE ELIGIBLE FOR THE STATE PROGRAM WERE BEING QUALIFIED FOR FEDERAL MEDICAID, FOR WHICH THEY WERE INELIGIBLE. FACED WITH A STAGGERING AMOUNT OF DATA AND A NEED FOR QUICK ACTION TO PREVENT FURTHER LOSSES, THE AUDIT TEAM DESIGNED A COMPUTER PROGRAM THAT WOULD PRODUCE LISTS OF OLD AGE ASSISTANCE CLAIMS OF PUBLIC ASSISTANCE OR MEDICALLY NEEDY RECIPIENTS UNDER 65 YEARS OLD. THIS WAS RUN ON ALL REIMBURSEMENT TAPES RETAINED BY NEW YORK CITY. THE PRINTOUT UNCOVERED $14 MILLION IN OVERPAYMENTS CAUSED BY A COMPUTER PROGRAM WHICH HAD RECLASSIFIED CLAIMS TO FEDERAL MEDICAID BY USING ERRONEOUS METHODS TO COMPARE BIRTH AND HOSPITAL ADMISSION DATES AND CONVERTING CERTAIN CLAIMS WHEN THE ADMISSION DATE WAS LEFT BLANK. THE CITY PROMPTLY CORRECTED ITS EQUIPMENT. NEW YORK STATE, IN A SUBSEQUENT REVIEW, FOUND AN ADDITIONAL $4 MILLION THAT HAD BEEN INCORRECTLY CHARGED TO THE FEDERAL PROGRAM. THE COMPUTER MADE IT POSSIBLE TO TAKE CORRECTIVE ACTION WITHIN A MONTH AFTER OVERBILLINGS WERE FIRST SUSPECTED AS OPPOSED TO SEVERAL MONTHS FOR A TRADITIONAL AUDIT. (MJM)