Medicare Shortchanged Kansas Hospitals Billions, Lawsuit Alleges

A coalition of Kansas hospitals is suing Medicare over a decades-old payment formula they allege shortchanged them billions of dollars.

Five hospitals affiliated with the University of Kansas Health System filed a suit Mar. 20 in the US District Court for the District of Columbia. They claimed the Centers for Medicare & Medicaid Services unlawfully prolonged a reduction in Medicare payments that was supposed to apply only to 1984 and 1985, a period during which the agency was transitioning from its old payment policy to the current one.

When Medicare was established in 1965, the program reimbursed hospitals for the ...