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PSCs Found to Have Little Effect on Recovery of Medicare Overpayments

The Office of the Inspector General (“OIG”) of the Department of Health and Human Services (“HHS”) issued a report this month showing that program safeguard contractors (“PSCs”) have not resulted in significant recoveries to the Medicare program.

PSCs are intended to detect and deter fraud and abuse in Medicare, by conducting investigations and, at issue, here, referring overpayments for recovery by claims processors to Medicare. However, in its report, found here, the OIG found that:

PSCs referred 4,239 overpayments totaling $835 million to claims processors in 2007, but very little had been collected by claims processors as of June 2008. Claims processors collected 7 percent, or $55 million. Of the $55 million collected, 27 percent was for Part A claims; 56 percent was for Part B claims excluding durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS); and 17 percent was for Part B DMEPOS claims.

The OIG’s report includes a number of recommendations to ensure that PSCs and their successors, Zone Program Integrity Contractors (“ZPICs”) are effective. The OIG especially stresses the importance of regularly monitoring overpayment recovery collection efforts.

For more information on compliance or overpayment demands, please contact Abby Pendleton, Esq., and for more information on government investigations or subpoenas, please contact Robert S. Iwrey, Esq. Both can be reached at (248) 996-8510.

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