Posted on August 29, 2011 14:32
Categories: Medicaid
Topics: Cost-effectiveness | Medicaid
On July 12, the Government Accountability Office (GAO) released a report finding that the federal government’s current electronic health care fraud detection system is inadequate and underused. Implemented in 2009, federal officials originally projected that the $150 million system would save $21 billion annually, but the GAO found that inadequate system operation prevents it from addressing the up to $90 billion in estimated annual health fraud. The report notes that the system currently lacks Medicaid data, which officials from the Centers for Medicare & Medicaid Services (CMS) plan to integrate into the system by 2014. Additionally, the report asserts that CMS is not conducting staff training on schedule for employees needed to operate the system.
From the report:
Like financial institutions, credit card companies, telecommunications firms, and other private sector companies that take steps to protect customers’ accounts, CMS uses information technology to help detect cases of improper claims and payments. For more than a decade, the agency and its contractors have used automated software tools to analyze data from various sources to detect patterns of unusual activities or financial transactions that indicate payments could have been made for fraudulent charges or improper payments. For example, to identify unusual billing patterns and support investigations and prosecutions of cases, analysts and investigators access information about key actions taken to process claims as they are filed and the specific details about claims already paid.
Full report: Additional Actions Needed to Support Program Integrity Efforts at Centers for Medicare and Medicaid Services (PDF | 186 KB) 
Government Accountability Office. (2011). Additional actions needed to support program integrity efforts at Centers for Medicare and Medicaid Services. Willemssen, Joel C.
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