Medicare Fraud Detection Program Hasn't Helped

By ALLISON BELL

Published 7/12/2011

A Medicare cost saving program that is supposed to save about $187 million between 2006 and 2018 may not have saved anything.

Joel Willemssen, managing director of the U.S. Government Accountability Office (GAO), gave that assessment today in testimony presented at a hearing organized by the Senate Homeland Security and Government Affairs Committee’s federal financial management subcommittee.

The subcommittee held the hearing to look at efforts to protect the integrity of the Medicare and Medicaid programs.

The federal Centers for Medicare and Medicaid Services (CMS), the arm of the U.S. Department of Health and Human Services that runs Medicare, started an Integrated Data Repository (IDR) program and a One PI program in 2006.

The IDR program was supposed to create a single source of Medicare and Medicaid claim data, and the One PI program was supposed to create a centralized portal for analyzing the data and looking for signs of fraudulent billing. CMS officials wanted analysts to be able to look to see, for example, when Medicare enrollees had apparently used ambulance services without using any other type of medical care.

CMS hired contractors to develop the tools and was supposed to have tools in place by 2009.

Parts of the IDR system have been in place since 2006, but the repository is still incomplete, Willemssen said, according to a written version of his remarks provided by the GAO.

“Program officials have not defined plans and reliable schedules for incorporating the additional data into IDR that are needed to support the agency’s program integrity goals,” Willemssen said.

Because of the project management problems, CMS officials stopped efforts to add more data to the repository after spending more than $80 million and more than 3 years on the effort, Willemssen said.

CMS deployed the One PI analysis system in 2009, but it is not widely used, in part because of problems with analyst training, Willemssen said.

There were supposed to be 639 analysts trained to use the system by October 2010, but only 42 were actually trained, Willemssaid said.

“Because IDR and One PI are not being used as planned, CMS officials are not yet in a position to determine the extent to which the systems are providing financial benefits or supporting the agency’s initiatives to meet program integrity goals and objectives,” Willemssen said.

CMS officials have suggested that the IDR project should cost about $90 million through 2018, provide a total of $187 million in financial benefits, and lead to $97 million in net benefits.

 “As of March 2011, program officials had not identified actual financial benefits of implementing IDR,” Willemssen said.

Similarly, because of the relatively low level of use of the One PI system, there are “not enough data available to quantify financial benefits attributable to the use of the system,” Willemssen said.

“Until CMS is better positioned to identify and measure financial benefits and establishes outcome-based performance measures to help gauge progress toward meeting program integrity goals, it cannot be assured that the systems will contribute to improvements in CMS’s ability to detect fraud, waste, and abuse in the Medicare and Medicaid programs, and prevent or recover billions of dollars lost to improper payments of claims,” Willemssen said.