A state appeals court upheld an arbitration award in favor of Meadowlands Hospital Medical Center after a consulting company miscalculated a Medicare reimbursement, costing the hospital millions.

According to the New Jersey Appellate Division opinion, when Meadowlands Hospital decided to create a graduate medical education program, it contracted with Besler & Co. to provide consultation services, including a three-year estimate of graduate and indirect medical education reimbursements. Besler provided the estimate using what turned out to be an incorrect per-resident amount (PRA), the court said.

When calculating the PRA, a mistake was made by Besler when it presumed 2012 was the first year Meadowlands would have its own residents, according to the opinion. In fact, there were two podiatry residents in 2002, which lowered the PRA to the level calculated for that year. Instead of being entitled to the $5.23 million in payments from Medicare received, the hospital was only entitled to $3.44 million.