Hospitals Receive Excess $500 Million From Medicare: Watchdog

Medicare overpaid 60 hospitals by more than half a billion dollars over a four-year period, the Health and Human Services Department Inspector General said in a Nov. 27 report.

The $502 million in surplus payments came during the 2011-2014 fiscal years, and stemmed from the criteria that Medicare uses to decide when to review outlier payments. Outlier payments are made when the cost of care exceeds a threshold set by the Centers for Medicare & Medicaid Services. Those payments are reviewed and reconciled by regional Medicare administrative contractors, the private insurers that process claims.

The contractors use a ratio ...