Medicare Turns to Predictive Modeling

Technology Part of Anti-Fraud Effort
Medicare Turns to Predictive Modeling
Starting July 1, the Department of Health and Human Services will use predictive modeling technology to help identify fraudulent Medicare claims before they're paid.

HHS Secretary Kathleen Sebelius announced the nationwide effort June 17. HHS has entered a contract with Northrop Grumman to lead the technology effort in partnership with National Government Services and Federal Network Systems, a Verizon company.

Medicare claims will be analyzed using risk-scoring technology that applies predictive models, an approach similar to that used in the private sector to identify credit card fraud. For the first time, federal authorities "will 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," according to a statement from the Centers for Medicare & Medicaid Services, a unit of HHS.

Northrop Grumman will deploy algorithms and an analytical process to review claims by beneficiary, provider, service origin or other patterns to identify potential problems and assign risk scores and alerts. "These problem alerts will be further reviewed to allow CMS to both prioritize claims for additional review and assess the need for investigative or other enforcement actions," according to the CMS statement.

CMS announced in February plans to speed up the implementation of the anti-fraud technology, originally slated for limited tests this year. Also, HHS published a final anti-fraud rule in February to carry out healthcare reform's mandated programs. For example, it gives federal authorities the power to temporarily stop payments to those for whom there has been a credible fraud allegation until an investigation is completed.

About the Author

Howard Anderson

Howard Anderson

Former News Editor, ISMG

Anderson was news editor of Information Security Media Group and founding editor of HealthcareInfoSecurity and DataBreachToday. He has more than 40 years of journalism experience, with a focus on healthcare information technology issues. Before launching HealthcareInfoSecurity, he served as founding editor of Health Data Management magazine, where he worked for 17 years, and he served in leadership roles at several other healthcare magazines and newspapers.

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