Medicare hired PRG-Schultz International to audit claims made by rehabilitation hospitals in Florida, California and New York. It was limited to three states as it was seen as an experiment. If it was cost-effective in the three states, the audit process would be used in all fifty states. Need I say that things don't seem to be working out well.
The basic problem seems to be the terms of the contract. PRG earned a commission of between 25-30% on every dollar identified as wrongly paid by Medicare. Initial results seemed to work out well as PRG found $105,000,000 that had been wrongly paid in their opinion.
One difficulty with PRG's work, in the words of an administrative law judge, was that "there was no evidence of good cause"; that is, there were "no documents in the record that show what PRG-Schultz did to review or discover a potential overpayment". What this means - and is, in fact, happening - is that most of the overpayments reported by PRG and for which they have received their commission will be rejected by Medicare and the courts.
1 comment:
Lets see how we can make all government profitable for private industry. Let the drug companies pay the FDA to review their products - that will really make them a disinterested research facility. Consumer protection has been reduced to nothing - one tiny office to review all the toys according to NPR. Regulation might suck as a govenment function, but a referee cannot be paid by the bounty method which is even worse. It is an old book (a penny on Amazon) but The Great White Lie by Walt Bogdanich exposes how the medical field cheats Medicare by coding fraud in billing etc. What does the government do to save money? Reduce the number of regulators.
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