In particular, the government agency the Center for Medicare & Medicaid Services (CMS) and other private insurance companies have adopted predictive analytics and machine learning techniques in order to better detect fraud and prevent medical billing errors 1,2.
Full Answer
How is technology being used to combat waste and fraud in Medicaid?
Technological advancements are providing new tools to combat waste, fraud, and abuse, though it wasn’t until May 2013 that states could receive federal matching funds for data mining efforts in Medicaid, and MFCUs must submit an application to do so to the OIG for approval.
What is the best way to combat Medicare and Medicaid fraud?
Rather than relying on piecemeal components to combat Medicare and Medicaid fraud, as many health plans do, a comprehensive approach is best practice. To truly be successful with a fraud, waste and abuse program, you must have three key pieces of the puzzle in place: Technology, Clinical Audits and Investigative capabilities.
What is upcoding and Medicare fraud?
Medicare fraud has been the cause of up to $60 billion in overpaid claims in 2015 alone. Upcoding occurs when a healthcare provider has submitted codes for more severe conditions than diagnosed for the patient to receive higher reimbursement.
How to combat fraud waste and abuse in the healthcare industry?
To thoroughly combat fraud, waste and abuse in your organization, you need to be sure your solution has the following three key components: Health plans and managed care organizations have to connect large volumes of data in order to comply with fraud, waste and abuse regulations.
How do you leverage technology against Health Care Fraud?
How To Leverage Technology Against Healthcare FraudPerforming unnecessary procedures for higher profit.Misrepresenting uncovered treatments as covered.Accepting kickbacks for patient referrals.Waiving co-pays to up-bill a patient's insurance.
How can billing fraud be prevented?
OutSmart Billing Fraud with Internal ControlsSeparate your accounting duties: Accounts Payable, Accounts Receivable, & Authorization/Check Writing.Use Purchase Orders, or enact separate approval on invoices before handing them to the bookkeeper.Separate bank reconciliation from bill payment.More items...
How can Medicare fraud be prevented?
Don't talk to anyone who knocks on your door or approaches you in person and claims to represent Medicare or to be selling Medicare-covered supplies or services, such as braces or COVID-19 tests. Don't accept money or gifts to use the services of a medical provider or device supplier.
What strategies can be used to combat fraud and abuse in coding?
Fraud and Abuse Prevention StrategiesMake sure that all coding staff have been properly trained and receive ongoing continuing education.Develop comprehensive internal policies and procedures for coding and billing and make sure these written procedures are kept up-to-date.More items...
What is medical coding fraud?
Coding fraud involves the knowing submission of claims to government insurers with incorrect billing codes, diagnostic codes, units of service, dates of service, or service providers.
What are the four explanations for fraud in the healthcare system?
CMS categorizes fraud and program integrity issues into 4 categories: (1) mistakes resulting in administrative errors, such as incorrect billing; (2) inefficiencies causing waste, such as ordering excessive diagnostic tests; (3) bending and abuse of rules, such as upcoding claims; and (4) intentional, deceptive fraud, ...
What are the possible consequences of coding fraud and abuse?
Violating these laws may result in nonpayment of claims, Civil Monetary Penalties (CMP), exclusion from all Federal health care programs, and criminal and civil liability.
What is up coding and why is it important to avoid up coding?
“Upcoding” occurs when a healthcare provider submits codes to Medicare, Medicaid or private insurers for more serious (and more expensive) diagnoses or procedures than the provider actually diagnosed or performed.
Can a coding or billing specialist be found guilty of fraud?
Billing for services rendered by an unlicensed or excluded provider can result in fraud charges under the FCA, even if the provider is not directly affiliated with your practice.
How does machine learning help in fraud detection?
Machine learning plays an innovative role in fraud detection because it can very quickly predict potential fraud cases based on past available data. Broadly speaking, a model that predicts fraud can be created through “supervised” or “unsupervised” machine learning. In “supervised” machine learning, the computer would be fed billing data ...
What is FPS in Medicare?
So, are these types of algorithms the end game for fraud detection? For CMS and Medicare, they are far from it. At CMS, its Fraud Prevention System (FPS) functions as a way to generate leads for investigation by identifying outliers in the data and flagging cases for potential fraud 3. In recent years, FPS has been increasingly incorporated into the fraud investigation workflow, generating 5% of all leads investigated by CMS in the beginning years, up to 20% more recently in 2015-16 3. While this amounts to 1.4 billion dollars of savings, these FPS leads still require extensive non-automated “manual” investigations by CMS or government-contracted employees 3,9.
Can machine learning detect Medicare fraud?
Machine learning can help detect Medicare fraud, but what is the tradeoff between human v.s machine? The words “machine learning” and “healthcare” together often conjure images of IBM Watson and the potential to transform who provides medical care and how. But machine learning’s applications are much broader, and play an extremely important role in ...
What is medical coding fraud?
Fraud, in regard to medical coding, is when a false claim misrepresenting the facts is intentionally submitted to insurance in order to receive payment.
Why should coding be audited?
Auditing can provide areas for improvement for your coding staff. Even a well-trained staff must be checked, therefore every practice should have an audit performed annually. An audit can recognize under coding, bad unbundling habits, and code overuse. Coding staff will then be able to bill appropriately for documented procedures.
What is coding services?
Coding services are the life-blood of your practice. That is how the services you provide are transformed into billable revenue. It takes a knowledgeable and experienced coding staff to maximize your billed charges while maintaining strict compliance with CMS and CCI guidelines. Coders are trained to identify noncompliance and fraud.
Why is it important to be a coder?
It is VERY important as a coder to be knowledgeable and confident in their field, so they are able to detect any potential risks that could negatively impact the facility and/or physician they work for as well as educate the people around them that don’t know.
What is a coder's job?
Coders are trained to identify noncompliance and fraud. Part of a coder’s job is to have sound knowledge in detecting ambiguous or suspicious documentation that could lead to fraud as a false claim if not detected before being submitted to insurance and being paid.
Can you code both procedures?
Some higher paying procedure codes include smaller procedures in their code descriptions, so you can’t code both. You would only bill the one code that includes both procedures in the description.
What is the federal government's role in Medicaid fraud?
The federal government has a significant interest in combatting waste, fraud, and abuse in the Medicaid program because it provides more than half of the program’s financing (approximately 60 percent), but the states are largely responsible for carrying out Medicaid fraud prevention and detection activities because the states are the administrators of the program.
Why are there so many opportunities for Medicaid fraud?
Some of these opportunities are the result of efforts to guard against improper denial of benefits. Other opportunities exist because of the overwhelming effort required to verify every piece of information ...
What percentage of Medicaid payments were improper in 2014?
In 2014, 6.7 percent of all Medicaid payments were improper, causing Medicaid to be responsible for 14 percent ($17.5 billion) of all federal improper payments, second only to Medicare, which was responsible for 49 percent of federal improper payments.
What is Medicaid fraud recovery?
States’ fraud recovery efforts are largely carried out through Medicaid Fraud Control Units (MFCUs). These units typically operate through the state Attorney General’s office, and are certified and overseen by the HHS OIG. These units investigate and prosecute provider fraud, as well as investigate and report patient abuse and neglect in health care facilities. States are reimbursed with federal funds for operating expenses based on the amount of time a state’s MFCU has been operational: in the first three years, the federal government will pay 90 percent of a state’s costs, and 75 percent thereafter. [23]
When did CMS establish Medicaid Integrity Program?
In 2005, Congress ordered CMS to establish the Medicaid Integrity Program (MIP) and to develop every five years a strategy outlined in the Comprehensive Medicaid Integrity Plan (CMIP) which details how auditing contractors (RACs and Audit MICs) will be used and how CMS will effectively support state efforts to combat fraud and abuse. [28] CMS must report to Congress annually on their use and effectiveness of MIP funds. CMS contracts with independent Audit Medicaid Integrity Contractors (Audit MICs) and Recovery Audit Contractors (RACs) to audit providers and reconcile improper payments. [29]
How much has Medicaid increased since 2013?
Since 2013, enrollment in Medicaid has increased 25 percent. Total program expenditures increased 11 percent in 2014 and federal expenditures increased an estimated 16 percent in 2015.
How much of Medicaid funding must be used by states?
States also have ways to abuse the system. States must use state funds to finance at least 40 percent of the nonfederal share of a state’s Medicaid expenditures. However, states have found ways to draw down more federal matching funds than they are intended to receive.
Why is CMS focusing on eliminating fraud, waste and abuse?
The continued focus of CMS on eliminating Medicaid and Medicare fraud, waste and abuse means that health plans need to properly utilize technology to gain transparency into their process. Health plans and managed care organizations have to connect large volumes of data in order to comply with fraud, waste and abuse regulations. Advanced technology – especially a solution that leverages applications of A.I. like deep learning – can integrate and process large amounts of data to identify anomalies and patterns more effectively than people can do alone.
What is technology enabled fraud, waste and abuse?
Technology-enabled fraud, waste and abuse solutions can quickly turn things around for MCOs – especially if they are plugged into a larger, more integrative payment integrity platform . Documentation, risk identification, lead prioritization, referrals, audit preparation and reporting are all capabilities that a robust fraud, waste and abuse technology solution can provide to MCOs and health plans.
Why should health plans have an investigative arm?
Increasingly, health plans, payers and MCOs should arm their FWA programs with a strong investigative arm in order to protect against non-compliance. If fraud is suspected, investigative capabilities allow direct reporting of fraud schemes to the appropriate authorities, providing evidence that supports (and protects) health payers and taxpayer funds. Should a claim be taken to court, both the evidence and a documented FWA process within a health insurance organization prove invaluable.
What is the second element of preventive fraud, waste and abuse?
The second element a preventive fraud, waste and abuse program needs to have is the ability to perform clinical audits. This gives MCOs and other payers and health plans the ability to review claims that have been flagged as potential fraud, waste or abuse cases. Clinical audits determine if diagnoses, prescriptions, encounters, procedures and more are worthy of further investigation or not. An internal audit program is beneficial to a health plan, as it often can be used to prevent improper payments from occurring in the first place.
Why is big data important in healthcare?
The amount of big data collected by healthcare organizations presents incredible opportunities to those invested in fraud, waste and abuse prevention. Governmental agencies are now using big data to investigate and prosecute FWA offenders. Mike Cohen, an operations officer with the OIG’s Office of Investigations, explains that “data…creates a pyramid effect, and we can go to the top of that pyramid.” And as fraud schemes grow increasingly sophisticated, the evidence data must evolve along with it.
What are the major oversights found in the Medicaid report?
The major oversights found in their report include: Failure to report offending providers to the state (allowing them to defraud other Medicaid insurers).
What is improper payment?
Fraud, waste and abuse are three classifications of improper payments, which is a payment made or received in error in a government healthcare assistance program (like Medicare and Medicaid).
How to prevent Medicare fraud?
While chasing fraudulent payments after the fact has been standard practice, the Centers for Medicare & Medicaid Services (CMS) and forward-thinking state agencies are adopting new technologies and practices that allow them to prevent fraud before it happens by proactively identifying high-risk providers and suspicious claims. Methods such as data mining, predictive analytics, fraud scoring, and standardized provider registration – enabled by clean sets of in-house and third-party data – are allowing these agencies to target the highest-risk providers for investigation. Ultimately, these practices will help public and private payers to identify the main sources of abuse, prevent fraud, and cut costs.
How to obtain a complete view of potentially fraudulent behavior?
To obtain a complete view of potentially fraudulent behavior, payers should constantly update old business information and monitor providers for location changes, employment of unlicensed practitioners, and other potential signs of abuse.
How can standardized registration help?
Standardizing and automating online registration can address these problems by enabling complete assessment of provider risk upfront. “It’s a lot easier to catch and identify high-risk providers on the front end than on the back end when you’re tasked with mining mountains of claims data to look for the proverbial needle in the haystack,” said Wright. To improve the quality and reliability of nationwide registration data, Dun & Bradstreet recommends provider verification across multiple jurisdictions, continual monitoring of good standing, and consistent input requirements among CMS and the states to support modeling, fraud scoring, and risk analysis. Ensuring accurate, standardized, and timely provider data during the provider registration process not only exposes would-be defrauders before they bill, but it also allows payers to use the resulting insights when applying predictive analytics to flag suspicious healthcare claims.
Why are healthcare costs rising?
Because of “creative” billing practices, healthcare costs are rising while access is decreasing for eligible beneficiaries . “There’s an ongoing evolution of not only the methodologies fraudsters employ, but an incredible ability to exploit vulnerabilities unique to subcategories of providers,” said Sandy Wright, Dun & Bradstreet director of business development. The more money these providers siphon from the healthcare system for purposes other than providing care, the greater the costs will be for taxpayers and healthcare recipients.
How can public payers curb abuses?
Fortunately, public and private payers alike can curb abuses and keep costs down by standardizing provider registration processes, verifying provider information with third-party data, and tracking the relationships between businesses and individuals.
Is upcoding a fraud?
Unnecessary procedures are a common fraudulent activity, however submitting claims for services not performed is even more prevalent. A variation of that practice is upcoding – using billing codes for procedures that are more costly than the actual treatment.
Does the pay and chase system work?
The current pay-and-chase system does not work, and the practices public agencies are adopting must be leveraged in order for the private sector to keep costs under control. “If the whole system, public and private, can be flipped to a preventative model, everybody wins,” said Muckerman.
How does CMS prevent fraud?
3, 6 CMS currently utilizes the Fraud Prevention System, which applies algorithms to monitor and analyze incoming claims and payments. Flags are automatically placed on outliers, which the Office of the Inspector General of the US Department of Health and Human Services can further investigate, along with provider risk ratings and peer comparisons. 3 Using real-time data collection, the Office of the Inspector General can compare patient volume for similar professional claims to identify abnormally high reimbursement submissions, unnatural practice growth patterns, or unusually high numbers of procedures based on specialty and practice size or to flag suspect patient visits patterns (such as an excessive number of patients during a 24-hour window.) 22, 23 This artificial intelligence-based system for identifying potential program integrity anomalies is relatively new. But CMS is also directed to cases by whistleblowers, who are incentivized to report fraud under the False Claims Act and Stark Law (ie, prohibition on self-referral), which entitle them to receive a percentage of any government recoveries. 24, 25
What are the 4 categories of CMS program integrity violations?
The 4 categories of CMS program integrity violations can result from unintentionally false or mistaken documentation submitted for reimbursement or from negligent or intentionally false documentation. Billing errors and mistakes, misclassification of a diagnosis or procedure, or improper documentation can indicate lack of program integrity education. 16, 17, 18 Inaccurate coding or errors in documentation can result from improper or incomplete interaction with the patient’s electronic health record (EHR) if the physician merely copies and pastes text, if the EHR self-populates from previous encounters, or if the algorithm prompts the physician to offer the patient potentially unnecessary or inappropriate services. 16, 17 When do these types of behaviors become fraud?
What are the 4 categories of fraud?
CMS categorizes fraud and program integrity issues into 4 categories: (1) mistakes resulting in administrative errors, such as incorrect billing; (2) inefficiencies causing waste, such as ordering excessive diagnostic tests; (3) bending and abuse of rules, such as upcoding claims; and (4) intentional, deceptive fraud, such as billing for services or tests that were not provided or that are undoubtedly medically unnecessary (and sometimes harmful to the patient). 9 Fraud reduction requires effective identification of these kinds of activities—or, as we prefer to call them, “behaviors”—and targeted deterrence strategies directed at their root causes, including systems issues. Some of these root causes are practice-site induced: optimizing volume, focusing on reimbursable and profitable services, and restructuring clinical staffing to include expanded use of medical assistants and clerical personnel to perform some patient care-related functions that might be construed as unlicensed practice. Increased corporatization and profitization of medicine can encourage behaviors that fall under the 4 categories.
What is program integrity education?
Program integrity education. Program integrity and fraud control must start in undergraduate medical education and remain an explicit component of residency mentoring, which is the job of medical school deans, department chairs, and division directors and preceptors . The already traffic-jammed curriculum could be gently massaged—to weave in a bit more about patient safety, malpractice, quality assurance, evidence-based medicine, and appropriate billing practices. A special program could also be implemented during medical school or employment to address program integrity issues arising from mistakes and inadvertent errors in both EHR charting and billing. The literature suggests that comprehensive education in this area is lacking, with only about one-third of medical schools providing any curricular content relating to fraud and abuse. 17 In response, some stakeholders recommend resident physician education that would cover issues pertaining to compliance, billing, appropriate documentation, adequate supervision, and potential civil and criminal liability. 16, 17, 18 A variety of training models exist, and several commentators suggest integrating program integrity training as part of the physician onboarding process. 16
Do physicians support fraud?
Although most physicians oppose outright fraud, such as billing for services never rendered or subjecting patients to medically unnecessary tests, procedures, or medications, the marketplace is rife with behaviors that inflate health care system costs, produce inefficiencies, and harm patients.