Case Study Summary: Penstock uncovered $2.7 million in missed recoveries for a state Medicaid managed care plan by identifying duplicate same-day Emergency Department and Observation payments—an issue tied to a state policy gap that other vendors only partially detected. Penstock’s data mining and policy expertise revealed the full scope of overpayments from day one.

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Penstock partnered with a state Medicaid managed care plan to investigate duplicate payments for same-day Emergency Department (ED) and Observation services—a violation of state policy that allows reimbursement for Observation only when both occur on the same day.

Due to system configuration and review gaps, both services were being paid—creating millions in unnecessary costs. While other vendors had tagged portions of the issue, Penstock’s data mining analytics expertise identified the entire population of overpaid claims and identified a $2.7 million recovery opportunity.

By combining advanced data mining analytics with state policy insight, Penstock demonstrated how a single, targeted concept submission could have captured the entire $2.7M opportunity—well before other vendors reached partial results.

What we did:

• Mapped state Medicaid guidance to the plan’s payment configuration to identify policy conflicts
• Correlated ED and observation encounters to pinpoint same-day dual payments
• Built a full, multi-year report for all impacted claims/providers—totaling $2.7M in potential recoveries
• Delivered a complete, ready-to-execute recovery concept with claim-level specificity
• Highlighted adjudication system gaps and collaborated with the plan to support future configuration updates

Results:

$2.7M
Total recoverable overpayments identified by Penstock

Penstock’s analysis revealed the full $2.7 million recovery opportunity tied to same-day ED and Observation claims. While other vendors captured only part of the total over several months, Penstock identified the entire scope from day one—demonstrating the difference that speed, completeness, and precision can make in payment integrity outcomes.

Human-led. Tech-enabled. Auditor-controlled.

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