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CMS launches new tool to combat medical fraud
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The Department of Health and Human Services Centers for Medicare & Medicaid Services (CMS) recently began using an innovative predictive modeling technology, similar to those used by various credit card companies, to fight Medicare fraud.
Predictive modeling helps identify potentially fraudulent Medicare claims on a nationwide basis and helps stop fraudulent claims before they are paid.
"Predictive modeling is a revolutionary new way to detect fraud and abuse, while minimizing burden on good actors, by integrating effective and timely actions with protections and savings for Medicare and taxpayers," said Peter Budetti, JD, MD, deputy administrator and director at the Center for Program Integrity.
According to Budetti, each workday, Medicare pays more than $1 billion from 4.5 million claims and is required to pay claims within 30 days.
"There is a need for innovative methods that will enable us to identify suspicious billing patterns before we pay the claims," Budetti said.
CMS issued a news release stating that this initiative builds on the new antifraud tools and resources provided by the Affordable Care Act that are helping move CMS beyond its former "pay and chase" recovery operations to an approach that focuses on preventing fraud and abuse before payment is made.
CMS Administrator Donald Berwick, MD, said this announcement is "bad news for criminals looking to take advantage of our seniors and defraud Medicare. This new technology will help us better identify and prevent fraud and abuse before it happens and helps to ensure the solvency of the Medicare Trust Fund."
Original Medicare claims will be analyzed using innovative risk-scoring technology that applies predictive models. For the first time, CMS will have the ability to use real-time data to spot suspect claims and providers and take action to stop fraudulent payments before they are paid.
Northrop Grumman, a global provider of advanced information solutions, was selected to develop CMS’s national predictive model technology format using best practices of both public and private stakeholders. The company will deploy algorithms and an analytical process that looks at CMS claims — by beneficiary, provider, service origin or other patterns — to identify potential problems and assign "alerts" and "risk scores" for those claims. These will be reviewed to allow CMS to prioritize claims and assess the need for investigative or other enforcement actions.
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