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Fighting Fraud with Pre-Payment Claims Review

Earlier this summer, the U.S. Government Accountability Office (GAO) released a report identifying the challenges that CMS faces in implementing strategies to prevent overpayments and fraud, waste, and abuse — including focusing on pre- and post-payment claims review on the most vulnerable areas.

Our administration has set battling healthcare fraud, waste and abuse as a high priority. A recent study found $835 million in questionable Medicare payments identified by private contractors in 2007.

Some states are following suit for their Medicaid programs. The Illinois Department of Healthcare and Family Services also recently issued a report on the efficiencies and improvements in the Illinois Medicaid program that included measures to prevent Medicaid fraud and overpayments by contracting with third parties to conduct payment and recapture audits. The State of Indiana also recently issued a Request for Services to detect fraud, waste and abuse in its Medicaid program.

It is also important to stop money from going out-the-door in the first place. Preventing inappropriate payments can be easier than “recovering” inappropriate payments after the fact — as evidenced by that fact that perpetrators often “close shop” and move on when they are notified of claim disputes. The GAO calls for Medicare to improve the pre-payment review of claims. As predictive modeling technologies continue to evolve pre-payment claim review will become a critical tool to combating fraud.

The “ethically challenged” understand the amount of money in healthcare – and do not limit their prey to government sponsored programs. It is critical for private payers, plan administrators and self-funded employer plans to follow suit in both pre- and post-claim review.

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