Using Technology To Tackle Healthcare’s $70 Billion Dollar Problem

01 May 2012 | Rob Rolf, Vice President Healthcare Compliance, CGI Federal
​It wasn’t until the Patient Protection and Affordable Care Act (PPACA) was enacted that everyone could truly understand the vast scope of healthcare waste, fraud and abuse. PPACA raised national awareness of the billions of dollars lost annually due to improper payments, and the impact those dollars had on healthcare payers and their beneficiaries. In fact, the Centers for Medicare & Medicaid Services (CMS) estimated that these programs issued over $70 billion in improper payments in the fiscal year 2010. Improper payments can include a number of defined categories such as unnecessary upcoding and bundling, ineligible recipients, ineligible services and many others. Provisions of PPACA aim to curb these payments. Overall, it is projected that fraud and abuse account for between 3 to 15 percent of annual expenditures for healthcare in the United States.
A key component of the recovery and identification process is the use of technology to leverage claims analysis. Through the use of computers and specialized programs, the out-of-the-ordinary can be easily brought to light and addressed in an efficient manner. Like finding the proverbial needle in a haystack, these special algorithms and edits can identify the unusual claims buried deep in a list of submitted codes.
So how should health plans be leveraging technology to find that proverbial needle in a haystack and cut out not only improper, but also fraudulent and wasteful payments?
It starts with data analysis to determine areas most vulnerable for improper payment. With a deeper understanding of the at-risk areas, health plans can identify ways to prevent future overpayments and implement changes and modifications as necessary. With the right technology, health plans can expedite the process of identifying targeted claims, deploy resources in a more efficient and effective way, all while reducing the impact to the provider community. These improvements, coupled with Microsoft technologies have been imperative when set against the current environment where funding of these initiatives are constantly under review.
Also under the microscope thanks to reform are the Medical Loss Ratios (MLR) of health insurance companies. In an attempt to bring down health care costs, PPACA requires the companies in the group or individual market to give annual rebates to enrollees if their MLR fails to meet the established minimum requirements of 85 percent in the large group market and 80 percent in the small group/individual market. These MLRs are generally what insurers use to set monthly premium rates. Using technology to identify and address improper payments is one of the best ways that health plans can reduce their administrative costs and begin having an impact on these new MLR requirements.
Microsoft and partner CGI, a leader in technology solutions with over 20 years of experience in identifying post payment and recovering improperly paid claims for state Medicaid programs, Medicare, and large private healthcare insurers, will host a complimentary webcast on Thursday, May 3 at 10:00 PT / 1:00 ET to talk more about this topic. Learn more about this game-changing opportunity for health plan operations and register for the Best Practices to Achieve Claims Recovery ROI & Improve Workflow Efficiencies webcast here.
Rob Rolf
Vice President Healthcare Compliance, CGI Federal