Private and Government Health Plans Form New Anti-Fraud Alliance

On July 26, 2012, Health and Human Services (HHS) Secretary Kathleen Sebelius and Attorney General Eric Holder announced an unprecedented partnership between private and public healthcare insurance organizations focused on fighting healthcare fraud.

The new voluntary effort plans to engage the federal, state and private healthcare payers for purposes of data sharing to spot and identify fraudulent schemes. For example, “the new venture could identify a doctor who bills Medicare and two private insurers for a total of more than 24 hours of work in a single day.”

The Centers for Medicare & Medicaid (CMS) also announced that a long term goal of the collaborative project is to use technology and analytics on industry-wide healthcare data to predict and detect health care fraud schemes. In the past, CMS has had trouble in finding technology to predict and stop fraud before it occurred. The Associated Press, for example, reported that in the first six months of operations, Medicare’s $77-million computer system designed to head off fraud before it happened had stopped just one suspicious payment from going out, for $7,591.

While the details of the program have yet to be identified, it is reported that 21 health insurance companies have agreed to participate, together with CMS, Federal Bureau of Investigations, New York’s Office of the Medicaid Inspector General, HHS’ Office of the Inspector General, the Department of Justice and state fraud control units.

Privacy advocates have expressed concern that the new effort may compromise patient privacy information even though private data will be required to be scrubbed prior to sharing.

A trusted third party “would comb through data from Medicare, Medicaid and private health plans and turn questionable billing over to insurers or government investigators. That third party organization has yet to be selected,” reported AP.