News-Medical.Net August 2, 2024
A new study reveals details on how US hospitals exploited a loophole in the Medicare outlier payments program, reaping billions of dollars in excess revenue.
Published as a National Bureau of Economic Research working paper today, the study adds new evidence to a headline-grabbing Medicare scandal, finding that for-profit hospitals funneled much of the windfall to executive compensation and shareholder payouts.
From 1998 to 2003, an estimated 180 hospitals engaged in “turbocharging” by rapidly increasing the list prices they charged patients to inflate Medicare payments-; many more than believed at the time. The hospitals that exploited this loophole gained about $3 billion in excess payments, said Ambar La Forgia, an assistant professor at UC Berkeley’s Haas School of Business.
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