Reprinted from The HCCA-AIS MEDICAID COMPLIANCE NEWS, monthly news and valuable how-to strategies for identifying and reducing today’s top Medicaid compliance risks.
By Eve Collins, Editor
October 2011 Volume 5 Issue 10
With an estimated $22 billion in fraud, waste and abuse in the Medicaid program alone, federal and state officials, along with representatives in the managed care industry, are setting in motion initiatives to improve Medicaid program integrity that are showing results in Medicare as well as other segments.
“We will always be doing pay and chase” to some extent, Peter Budetti, M.D., CMS deputy administrator and director of the Center for Program Integrity, noted on Sept. 15 at the America’s Health Insurance Plans Medicaid Conference. But “we want to get those guys when they’re at $30,000, not $320,000. And that’s the process that we’re setting in place to be much more sophisticated, take action much earlier and do things that will prevent the problems, prevent the bad guys from getting into the program…and prevent the bad guys from staying in the program.”
Getting all sides to communicate is part of the issue, so HHS Sec. Kathleen Sebelius in April realigned CMS into four centers and moved Medicare and Medicaid program integrity under the same roof. “So we are doing a lot to harmonize, to get maximum coordination and interaction out of our Medicaid integrity activities and our Medicare integrity activities,” said Budetti.
The private sector will need to be a major player in this too, with about 70% of Medicaid beneficiaries currently in managed care plans, said Louis Saccoccio, executive director of the National Health Care Anti-Fraud Association, who also spoke at the AHIP Medicaid Conference. And the number of Medicaid beneficiaries is expected to grow significantly with the Medicaid expansion under the health reform act, he pointed out, with approximately 16 million more people expected to be eligible for the program.
“There are requirements if you’re a state Medicaid managed care plan to report suspected fraud. But at what stage do you do that? There’s a definition of credible allegation of fraud in the suspension regulations [from the health reform law], but if you’re a health plan in Medicaid, when are you supposed to make that report?” Saccoccio asked.
Communication among the Medicaid payers was a recurring theme at the conference (see story, p. 5). Saccoccio noted that the first summit held by the HHS-DOJ Health Care Fraud Prevention and Enforcement Action Team (HEAT) in January 2010 brought the private and public sides together to talk about best practices. “Basically, what came out of that summit was three things: (1) We have to do a better job of data analysis; (2) we need to do a better job of information sharing; and (3) we need to do a better job of public awareness.”
Private health insurers with Medicaid lines also should be talking to each other about program integrity, Saccoccio said. In the property and casualty industry, “if you get into an automobile accident and you have Geico as your insurance company, Geico can check to see whether or not you have filed claims with other insurance companies going back several years…to see if there are any issues of fraud involved.”
Not so with health insurers. “One of the biggest challenges in health care as far as fraud is concerned…is that there’s no all-claims database,” according to Saccoccio. For instance, suppose a multiple-physician practice in the Washington, D.C., area has contracts with Medicaid, Medicare, CareFirst BlueCross BlueShield, Aetna Inc. and UnitedHealthcare. “Each of those payers is seeing [its own] claims, but nobody is seeing the big picture as to what those claims look like with respect to that provider group to order and analyze those claims for potential fraud issues,” he said.
Feds Are Warehousing Data
CMS has been working on an integrated data repository to combine claims together from Medicare, Medicaid, the Veterans Administration, the Department of Defense and other federal health care programs. Saccoccio said this “is a step in that direction.” One challenge there is that Medicaid is essentially 50 programs with 50 different databases that would have to be integrated into one system, he noted.
In the meantime, CMS has started predictive modeling with Medicare fee-for-service. “We have a lot of claims — millions and millions every day,” said Budetti. “The system goes through a data reduction process, then produces high priorities, and then we rule on what kind of action, if any, is appropriate,” he explained. “We want to prioritize our resources based upon the most egregious problems.”
This system takes claims data, results of investigations, complaints CMS is tracking through 1-800-Medicare calls and stolen identities (both beneficiary numbers and provider numbers), and produces a score so CMS can prioritize its investigations, Budetti explained. “We started out with a certain number of algorithms, and it’s going to expand and grow over time.”
Saccoccio predicted that the system will bear fruit. “The honest answer is nobody really knows how much fraud is in the system, but as Medicare fee-for-service starts to do their predictive modeling, there’s going to be a lot of things that turn up, I can guarantee you that.”
For Medicaid, the Center for Program Integrity currently reviews claims, audits providers, identifies overpayments and educates, according to Budetti.
Medicare is able to do pre-payment screenings, he pointed out, “but on the Medicaid side, because of the lag time between when states get claims and when we can deal with them, there is the necessity to do our work based upon post-payment [review].” That’s where Medicaid Integrity Contractors (MICs) come in. “The audit MICs look at both-fee-for service cost reports and managed care audits, and we identify overpayments which the states then collect.”
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