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How to prevent fraud on a shoestring

Blue Cross and Blue Shield of Louisiana shares a low-cost data analysis method

The schemes are legion: Claims arrive for fake lab tests or for medical equipment that was never ordered. Addicts doctor-shop for prescriptions or find pill mills and overdose. Illegal aliens and organized criminals infiltrate provider networks and bill for services that were never rendered. Every benefit is vulnerable to exploitation.

Fraud recoveries return about 20 cents on the dollar; not paying fraudulent claims nets dollar-for-dollar savings.

How do insurers guard against those who plot to take the money and run? Experts reveal that not all anti-fraud practices must be expensive to be effective.

Christine O'Neil, a supervisory special agent at the Boston FBI's Health Care Fraud Squad, recommended staying current with the latest schemes by following news reports of fraud, she said in an interview with FierceHealthPayer.

In addition, special investigations units undoubtedly require vigorous data analytics to determine fraud risk, but what if a state-of-the-art data solution isn't affordable? Darrell Langlois, vice president of compliance, privacy and fraud at Blue Cross and Blue Shield of Louisiana, shared a low-cost data analysis idea to find probable cases.

"With any specialty in any fraud scheme, there are four ratios," he said in an interview with FierceHealthPayer. "By simply putting two numbers one over the other, generating a ratio, and then matching those numbers provider by provider, you can determine who presents themselves as vulnerable to committing fraud."

The ratios are average dollars paid per patient, average visits per patient, average dollars paid per medical procedure and average medical procedures per visit, he said. If you see providers who deviate from the norm (e.g., if a given provider averages eight office visits per patient annually while other providers in the same specialty average two visits per patient a year), review further to determine what's driving the high numbers.

For even more payer strategies for preventing and detecting fraud, including advice from the FBI Health Care Fraud Squad, download FierceHealthPayer's free eBook, Payer Strategies to Prevent & Detect Fraud.

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