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An Audit A Day Keeps The Trustee Away: Use Of The Logical Relationship Test In The Medicare Recoupment Context, Adam T. Kahn

Adam T Kahn

Each year, the United States government wastes millions of dollars due to overpayments made to Medicare health care providers (generally hospitals and nursing homes) in bankruptcy. These overpayments stem from the Medicare/Medicaid payment scheme that requires advanced payments to Medicare providers based on estimates of services that will be provided, and adjusts later to account for the actual costs of the services provided. Where the prepaid estimates exceeded actual costs, the United States government—here a creditor—makes necessary annual retroactive adjustments by offsetting future monthly payments to Providers.

If a Medicare provider seeks relief under chapter 11 of the Bankruptcy Code, …