Hank B. Walther, Esq., is an attorney in Washington, D.C. He was formerly chief of the Health Care Fraud Unit in the Justice Department’s Criminal Division.
Excerpting from his insightful and laudable op-ed which ran in today's WSJ:
* * * * *
As I approached the counter at Burberry’s store in Midtown Manhattan almost eight years ago, I knew I was about to splurge. The purchase was a cashmere scarf, a Christmas gift for my wife, who had lovingly put up with another year of my work travel. I was a federal prosecutor at the time and not exactly living on a Madison Avenue salary, but it was the holiday season and who doesn’t love a nice scarf?
The gentleman at the counter swiped my credit card and carefully folded the scarf, placing it into the iconic plaid box. A moment later, he smiled smugly and said, “Sir, your card has been declined.” My initial embarrassment later turned to surprise when I discovered why: Based on my purchasing history, the credit-card company didn’t think I would shop at Burberry. Rather than allow a potentially fraudulent purchase, the transaction was blocked.
* YEP. I LOVE CAPITAL ONE! THEY'RE ALWAYS RIGHT ON TOP OF MY OWN CREDIT CARD SECURITY! IT'S CALLED... COMPETENCE.
The federal government, one of the largest payers of health-care claims in the world, should adopt this technology if it hopes to beat back fraud.
* THEY SHOULD, BUT THEY WON'T; AND IF I'M WRONG AND THEY TRY... BETCHA THEY SCREW IT UP.
Each year the Centers for Medicare and Medicaid Services pays more than $853 billion in health-care claims, amounting to almost 25% of the federal budget. But an estimated 10% of the claims paid are fraudulent. This year alone, the federal government will pay about $85 billion in fraudulent claims. That is more than the combined earnings of Exxon, Wells Fargo and Microsoft.
* AGAIN... FOLKS... A SANE CITIZENRY WOULD RISE UP AND BURN WASHINGTON D.C. TO THE GROUND.
(*SAID H*A*L*F IN JEST*)
Most people would be surprised to hear that government health-care programs are “trust-based” systems that rely on the good faith of medical providers to bill only for legitimate services. The government does little to assess the legitimacy of a claim before paying it.
* NOPE. I KNEW THIS. UNFORTUNATELY, THAT IS.
Unlike my credit-card company, the federal government has no tools that flag suspicious claims and stop them before payment is made.
CMS receives about 4.4 million Medicare claims a day, but there isn’t a central location for receiving and analyzing them. Instead, a hodgepodge of private contractors is responsible for paying different types of Medicare claims from different regions of the country. Separate contractors are responsible for reviewing those claims to identify fraud, but only after they’ve been paid.
* UNFRIGGIN'BELIEVABLE, AIN'T IT?!
* HEY... I'VE GOT AN IDEA: ANY MEMBER OF THE HOUSE OR SENATE WHO HAS SERVED MORE THAN 12 YEARS - PUT HIM/HER AGAINST A WALL AND SHOOT HIM/HER. ULTIMATELY THESE BOZOS ARE RESPONSIBLE FOR THIS CRAP! (REMEMBER "OVERSIGHT?")
In 2010 CMS began developing a data analytics tool called the Fraud Prevention System, which was layered on the web of existing contractors. Although there has been no independent review of the program, CMS has claimed that the tool “identified or prevented” approximately $454 million in fraudulent claims in 2014. Nobody outside of CMS, however, knows the amount of claims blocked before payment — the true test of success.
CMS’s $85 billion a year fraud problem is getting worse, but there are several steps the federal government can take:
First, CMS needs to reconsider its disjointed strategy for processing and reviewing Medicare payments. This bureaucratic structure has created a model of “pay and chase,” because the contractors who pay claims do not identify fraudulent ones.
Second, all health-care claims should be reviewed by a sophisticated data analytics tool at the time of submission, rather than after the money has disappeared.
Third, CMS should invite outsiders to review its fraud-detection systems and help develop new ones.