Nelson Hardiman works with providers who experience problems with their participation in the Medicare program, from enrollment issues to recovery audits. The incidence of Medicare recovery audits against healthcare providers is on the rise as the U.S. Department of Health and Human Services, Center for Medicare and Medicaid Services (CMS) has identified physician “overpayments” as a promising source of financing. Through the Recovery Audit Contractor (RAC) program and other initiatives, Medicare increasingly denies providers payments or audits them for alleged overpayments.

Nelson Hardiman regularly defends healthcare providers in Medicare Part B recovery audits and appeals, including audits by the administrative contractor (i.e. the carrier), formerly NHIC and, effective September 2, 2009, Palmetto GBA. In addition, Nelson Hardiman has significant experience defending audits by the program safeguard contractor, Safeguard, LLC (formerly EDS/Cal-BISC), the RAC auditor, PRG Schultz, and other Medicare contractors.

We have successfully assisted clients in all stages of the appeals process. Cases of note include:

  • In 2006, Nelson Hardiman represented a physician who provided intravenous immunoglobulin (IVIG), an infusion therapy sought by patients suffering from autoimmune diseases that caused severe neuropathy. In connection with a national effort by Medicare to cut back on IVIG reimbursement, the contractor contended that the patients failed to meet the Medicare-established criteria for IVIG and demanded repayment in excess of $1.4 million of services that were supposedly not reasonable and necessary. On appeal, at hearing, Nelson Hardiman used patient and expert testimony to demonstrate medical necessity, resulting in overturning of all but $300 (two-tenths of one percent) of the total alleged overpayment.
  • In 2007, Nelson Hardiman represented a medical group whose multiple offices were alleged to have been overpaid collectively in excess of $5.6 million of diagnostic testing, office visits, and other services that the contractor (NHIC) contended were unwarranted and unnecessary. Nelson Hardiman appealed to the Office of Medicare Hearing Appeals (OMHA) and presented testimony from the provider, patients, and experts to refute the audit findings. Following two days of hearing, the administrative law judge issued a decision reducing the overpayment from $5.6 million to $80,000, a reduction of over 98.6%.
  • In 2007, Nelson Hardiman defended a physician from whom recovery of over $800,000 was sought based on the abuse of his provider number by a clinic manager whom he failed to supervise adequately. Although Medicare ordinarily holds providers responsible for fraudulent or abusive billing that occurs as a result of insufficient oversight, Nelson Hardiman persuaded Medicare to abandon its overpayment demand entirely against the provider based on his forthright disclosure of the fraud and abuse. The provider was excused from any liability.
  • In 2008, Nelson Hardiman appealed a Medicare audit that, as a result of inattention by either prior counsel or the Medicare contractor, had been “lost” in the system, depriving the provider of the opportunity to contest overpayment findings. Nelson Hardiman sued the contractor and CMS (over the protestations of federal prosecutors) in order to compel the reinstatement of the appeal. Following the reinstatement, Nelson Hardiman defended the provider before OMHA, where the administrative law judge overruled 100% of the overpayment.

While these success stories are no guarantee of results in any particular case, they are reflective of the thorough and tireless approach that Nelson Hardiman attorneys use to defend physicians accused of overpayment by the Medicare Program. These examples highlight why Nelson Hardiman is regarded as a leader in defending Medicare providers in California.

In addition to defending recovery audits, Nelson Hardiman attorneys also advise providers in navigating complex Medicare issues and in Medicare compliance, including Medicare enrollment issues and Medicare Secondary Payor (MSP) issues. Nelson Hardiman has also successfully defended providers from claims by private health plans and private payor auditors (such as the Rawlings Group) who attempt to force providers to refund reimbursement based on patient Medicare coverage.


Nelson Hardiman works with providers who experience problems with their participation in the Medi-Cal (i.e. California Medicaid) program, from enrollment issues to suspensions to recovery audits. In contrast to the delegated contractor structure of the Medicare program, the Medi-Cal program is administered by the California Department of Health Care Services (DHCS, formerly known as Department of Health Services or DHS). Providers are often caught off guard by significant differences between the two programs and the approach of DHCS in comparison to the Medicare contractors.

Nelson Hardiman regularly represents providers in a wide range of issues before DHCS and Medi-Cal compliance issues.  We have successfully assisted clients in all aspects of Medi-Cal compliance. We assist physicians who face suspensions, disenrollments, Procedure Code limitations (PCL), civil monetary penalties (CMP), or other problems. In addition, we represent providers facing denials of payment and “overpayment” recovery audits. We have successfully assisted clients in all stages of the Medi-Cal administrative hearing process. Nelson Hardiman assists clients in taking a proactive approach to issues with the Medi-Cal program.

Among our significant Medi-Cal experience, Nelson Hardiman is known for several leading published cases against the Medi-Cal program, including:

  • Grier vs. Department of Health Services (2000), and UAPD vs. Department of Health Services, which established limitations on Medi-Cal audits; and
  • Florence Western Medical Clinic vs. Coye, which established the precedent that physicians may be able to avoid repayment entirely or obtain a reduction in claimed overpayments where there is delay by the Department.

More recent cases of note include:

  • In 2006, Nelson Hardiman attorneys represented a physician who was suspended from the Medi-Cal program by virtue of his decision to relinquish a medical license in another state that he no longer required. Medi-Cal refused to lift the suspension. Nelson Hardiman filed suit against the Department and obtained a court order against the Medi-Cal program directing the reinstatement of the physician. Nelson Hardiman has since repeated this achievement in subsequent cases.
  • In 2007, Nelson Hardiman attorneys defended allegations that a physician had been overpaid in excess of $500,000 by the Medi-Cal program. Nelson Hardiman, LLP appealed the overpayment determination and succeeded in having the amount reduced by 90%.
  • In 2008, Nelson Hardiman threatened to sue the Medi-Cal program for improperly continuing to list several physicians as “suspended and ineligible” without cause. The Medi-Cal program agreed to remove the physicians’ names immediately to avoid suit.

While these examples do not guarantee the outcome in any other case, they reflect our expertise in helping physicians navigate the extreme complexities of the Medi-Cal program.