California Hospitals Seek Investigation of Medicare Auditor
The California Hospital Association is petitioning the HHS Office of Inspector General to investigate PRG-Schultz International's contract to review Medicare claims submitted by California hospitals, the Sacramento Bee reports.
Under a contract with CMS, PRG-Schultz reviews Medicare claims submitted by hospitals to help root out improper payments. In 2005 the practice began as a pilot program in California, Florida and New York, but it since has been made permanent and will be expanded to other states.
Government records show that PRG-Schultz has rejected about $100 million in claims since its contract began.
Acting CMS Administrator Leslie Norwalk said that the firm has rejected about 97.3% of Medicare claims for inpatient rehabilitation services for bone replacement patients. Norwalk said such services could be provided in a skilled nursing facility for an outpatient setting.
However, CHA officials argue that the firm's denial of a high percentage of claims could hamper beneficiaries' access to inpatient rehabilitation care.
Donald White, a spokesperson for HHS OIG, said CHA's request is under review.
Sen. Dianne Feinstein (D-Calif.) in May asked CMS to review the firm's work in California. Feinstein's husband's investment company owns a large stake in PRG-Schultz.
Responding to Feinstein's request last week, Norwalk said PRG-Schultz "is acting in accordance with Medicare law and statutes."
Thirty-six members of the California congressional delegation also have written to CMS asking for a review of PRG-Schultz's work in California (Whitney, Sacramento Bee, 7/21).