Medicare will use high tech to curb fraud

The government agency that runs Medicare announced Friday its intention to use credit card industry technology to identify possibly fraudulent claims before they’re paid out, a significant shift from the current “pay and chase” model.

Medicare and Medicaid fraud costs the federal government billions of dollars a year and contributes significantly to the programs’ solvency problems. The use of “predictive modeling technology,” starting July 1, will enable Medicare to analyze claims using risk scoring technology and to identify suspect claims and providers, halting payments before they’re disbursed.

“Today’s announcement is bad news for criminals looking to take advantage of our seniors and defraud Medicare,” Centers for Medicare and Medicaid Services Administrator Donald Berwick said in a statement. “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.”

As the agency made its announcement, Attorney General Eric Holder vowed at a Health Care Fraud Summit in Philadelphia that the Department of Justice would also do its part.

“We are striking a blow against deceptive practices across the country,” he said, “and working to shut down healthcare fraud schemes and prevent the devastation that they can cause to individuals, families and communities.”

In his comments, Holder said the government and Congress should:

• Strengthen the Health Care Fraud Prevention and Enforcement Action Team (HEAT), a collaboration effort between top-level law enforcement and professional staff at the Justice and Health and Human Services departments;

• Support and expand the HHS/DOJ Medicare Fraud Strike Forces, multi-agency teams of federal, state and local investigators that combat fraud through data analysis and community policing;

• Pursue legislative and regulatory reforms such as removing barriers to information-sharing and increasing sanctions and penalties; and

• Engage private-sector stakeholders, including insurance plans and providers.