This final report points out that excellent progress is being made at the provider level in converting Medicare claims processing to a total electronic environment. As in all new systems, however, there are growing pains. Additional provider guidance would be beneficial for defining needed internal controls and the responsibilities of each provider in the claims process. Those still submitting hard copy claims need further encouragement to convert to a electric media claims (EMC) processing environment. We recommended that the Health Care Financing Administration (HCFA) consider (1) developing additional guidance and instruction on internal controls, (2) providing free training and cost-benefit information on EMC to providers still submitting hard copy claims, and (3) phasing in requirements that Medicare providers with significant paper claims volume convert to EMC. The HCFA concurred with our recommendations and noted several steps already taken to implement them.