Knowledge@Wharton November 24, 2025
Wharton’s Atul Gupta co-authored a study that looks at how hospitals gaming a Medicare loophole allocated their excess revenue.
Nearly two decades ago, the files were closed on a very public scandal over excessive health care profits from inflated Medicare reimbursements to hospitals. The Centers of Medicaid and Medicaid Services (CMS), which administers the Medicare program, had accused health care companies of charging Medicare excessive payments in its “outlier program,” which is designed to cover extraordinarily costly episodes of care. The CMS investigation ended with those companies settling the matter without admitting to any wrongdoing.
But the case left unanswered questions for Atul Gupta, Wharton professor of health care management, and a couple of his research colleagues. They sensed that...
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