Abstract
When auditing payments for medical services by a third party, estimates of payments erroneously made are frequently based on statistical samples. When such procedures are used by government agencies to audit Medicaid payments, hearing officers often base provider restitution on the lower end of an interval estimate, which is a function of sample size. Several methods are tested for maximizing the total restitution obtained from multiple audits subject to a constraint on the total cost of the auditing.
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