The Centers for Medicare & Medicaid Services (CMS) has announced that starting July 1, it will begin using innovative predictive modeling technology to fight Medicare fraud.
Similar to technology used by credit card companies, predictive modeling helps identify potentially fraudulent Medicare claims nationwide and help stop fraudulent claims before they are paid. This initiative builds on the new anti-fraud tools and resources provided by the Affordable Care Act that are helping move CMS beyond its former “pay and chase” recovery operations to focus on preventing fraud and abuse before payment is made.
“Today’s announcement is bad news for criminals looking to take advantage of our seniors and defraud Medicare,” said CMS Administrator Donald Berwick, MD “This new technology will help us better identify and prevent fraud and abuse before it happens and helps to ensure the solvency of the Medicare Trust Fund.”
Original Medicare claims will be analyzed using innovative risk-scoring technology that applies effective predictive models, an approach similar to that used by the private sector to successfully identify fraud. CMS will now have the ability to use real-time data to spot suspect claims and providers and take action to stop fraudulent payments before they are paid.
Northrop Grumman, headquartered in Arlington, Virginia, a global provider of advanced information solutions, was selected to develop CMS’ national predictive model technology. Northrop Grumman will deploy algorithms and an analytical process that looks at CMS claims-by beneficiary, provider, service origin, or other patterns-to identify potential problems and assign an “alert” and “risk scores” for those claims. These problem alerts will be further reviewed to allow CMS to prioritize claims for additional review and assess the need for investigative or other enforcement actions.
