In the hope of identifying instances of overbilling, the Centers for Medicare and Medicaid Services will be conducting recovery audits at hospitals in eleven different states. These states were chosen due to the higher reported frequency of fraudulent Medicare claims or short inpatient hospital stays, many of which could have led to overbilling.
According to Crain's Detroit Business, the states that see more claims for fraud are Michigan, Texas, Louisiana, New York, Illinois, California and Florida. The states that have the short 30 days or less inpatient hospital stays are Ohio, North Carolina, Missouri and Pennsylvania. The recovery audits are being done as part of the 2010 order from President Barack Obama that required Medicare to develop a plan for decreasing improper payments by $50 billion. Medicare was able to save around $18 billion in 2011 by identifying payment errors, the news source reports.
Recovery audits not only help hospitals and healthcare providers maintain financial compliance, but they can be used for any business in any industry. If there is suspicion of misappropriation, embezzlement or other unauthorized procedures, recovery audits can determine how much has been stolen and needs to be collected.