Lax Regulatory Environments For Non-Profit Hospitals Linked To Both Upcoding & Greater Provision Of Unprofitable Services

Lax regulatory environments for non-profit hospitals are linked to unprofitable services and upcoding claims. Through differential enforcement, Medicare regulators provide non-profit hospitals with varying degrees of latitude in complying with the False Claims Act. The leniency of regulators towards non-profit hospitals that provide greater proportions of unprofitable services, coupled with their higher upcoding, permits these hospitals to obtain higher prices and partially cross subsidize unprofitable services.

These findings were reported in “Regulator Leniency and Mispricing in Beneficent Nonprofits” a working paper by Jonas Heese, Ph.D.; Ranjani Krishnan, Ph.D.; and Frank Moers, Ph.D. The authors . . .