Problems With Evaluating the Cost Effectiveness of Professional Standards Review Organizations

Professional Standards Review Organizations (PSRO) are designed to make sure that health care services provided under Medicaid and Medicare are delivered as effectively, efficiently, and economically as possible. Nine estimates of cost savings attributable to PSRO are overstated by $16.7 million for Medicare and Medicaid. All but one of the nine estimates were either prepared by a PSRO or prepared on information provided by a PSRO.