Fed­eral fraud pros­e­cu­tions jumped 69% in 2011

Shift in in­ves­ti­ga­tors’ tac­tics, evo­lu­tion in tech­nol­ogy seen as rea­sons

Modern Healthcare - - EDI­TO­RIAL MODERN HEALTH­CARE - Joe Carl­son

Govern­ment in­ves­ti­ga­tors say they are mov­ing away from the old “pay-and-chase” model of health­care fraud en­force­ment, but the new fo­cus on pre­vent­ing fraud be­fore it hap­pens is not cut­ting off the flow of new cases for pros­e­cu­tion.

An ac­count­ing of fed­eral fraud cases based on Freedom of In­for­ma­tion Act re­quests shows that 1,235 peo­ple were pros­e­cuted for health­care fraud in fis­cal 2011—a record- shat­ter­ing 69% in­crease over the prior year, ac­cord­ing to the Trans­ac­tional Records Ac­cess Clear­ing­house project at Syra­cuse (N.Y.) Uni­ver­sity.

That tally in­cludes 548 de­fen­dants charged in Puerto Rico, where the HHS in­spec­tor gen­eral’s of­fice re­cently quadru­pled its staff, grow­ing its agent corps to nine from two. For com­par­i­son, the fraud hot­bed of South Florida saw only 141 pros­e­cu­tions in the same pe­riod, the TRAC project said.

De­spite the fan­fare ac­com­pa­ny­ing high num­bers of fraud cases and fi­nan­cial re­cov­er­ies when govern­ment agen­cies roll them out, of­fi­cials ac­knowl­edge that the trend still rep­re­sents the tra­di­tional mind­set of pay­ing fraud­sters and then chas­ing them with in­dict­ments to re­cover the money.

“The anal­ogy I use is that we used to chase like an ele­phant, and now we chase like a chee­tah,” said Ti­mothy Menke, se­nior adviser for in­ves­ti­ga­tions at the HHS in­spec­tor gen­eral’s of­fice and a for­mer deputy in­spec­tor gen­eral for in­ves­ti­ga­tions.

Be­hind the scenes, of­fi­cials with the in­spec­tor gen­eral’s of­fice and the CMS say they are in the midst of a tech­no­log­i­cal rev­o­lu­tion in which real-time, au­to­mated data anal­y­sis is sup­plant­ing the old sys­tem of chas­ing down tips and al­le­ga­tions with fee­ton-the-ground po­lice work. Cen­tral to that new ap­proach is the CMS’ re­cent ef­forts to cen­tral­ize all of its data.

To­day, all 4.5 mil­lion daily claims for Medi­care re­im­burse­ments are dig­i­tally an­a­lyzed in near-real time and then as­signed a risk score, us­ing a sys­tem rolled out last year and re­cently dubbed the CMS’ Fraud Preven­tion Sys­tem.

Pe­ter Budetti, deputy ad­min­is­tra­tor for pro­gram in­tegrity at the CMS, said an­a­lysts and sys­tems then scour the risk scores for pat­terns, such as sup­pli­ers or providers fre­quently linked to Medi­care claims with high fraud-risk scores. That data is then passed on to Medi­care’s ar­ray of fraud-preven­tion contractors and to the new fed­eral Medi­care fraud strike forces, which can quickly cut off Medi­care funds if they find ev­i­dence of cred­i­ble al­le­ga­tions of fraud.

The nine HEAT Strike Task Forces, based in fraud hot spots such as Los An­ge­les, Mi­ami, Chicago, Dallas and De­troit, were re­spon­si­ble for much of the in­creased pros­e­cu­tion ac­tiv­ity last year. Menke said $225 mil­lion of the $406 mil­lion that the in­spec­tor gen­eral’s of­fice re­ported as “investigative re­ceiv­ables” from com­pa­ra­ble cases in 2011 came from the work of the strike forces.

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