Larger fraud schemes means more money out the door


There has been a great deal of noise and subsequent press around healthcare fraud schemes getting larger and involving more collaborators. Much of the collusive fraud that has come to light has been taking place for years, costing millions of dollars, with very little recovery. In many cases, the conspirators flee and there is no one left to recover from – not your standard doctor billing for services not rendered.

Consider the instances where deceased provider NPI (National Provider Identifier) codes are being used to bill false claims to Medicare by organized crime. Often, the federal government pays for years without any knowledge that the actual doctor is no longer living.

We've heard a number of terms thrown around: conclusive fraud, organized crime, social networking, and more. It all sounds extreme and ominous, and brings up images of dark street corners with shadowy figures selling patient information and insulin.

Addressing this growing issue has become a serious concern. Many statistics have been published stating the increase of conclusive healthcare fraud. One of the main reasons for the increase is that healthcare fraud appears to be easier to commit and get away with than traditional financial fraud (money laundering, credit card fraud, etc.). Banks and standard insurance companies seem better at protecting their money than most healthcare organizations.

When considering collusive healthcare fraud, one of the most important aspects to keep aware of is target identification: who is committing the fraud, who is participating, and how are they conmected? Around every corner is another vendor talking about social network analysis, but the issue is not just identifying who’s associated in a network (or who is working together), but more importantly: at whom should you be looking?

Getting past marketing promises, it becomes very important for healthcare organizations to focus on solutions that present them with "aberrant" behavior across their book of business with an eye to conclusion. There appear to be no manual methods to properly identify the behavior, and then make the links required. Besides, who has the time?

Another consideration to keep in mind is what processes are in place to pursue collusive fraud if it is identified? Do you send all participating parties a bill? Not to make light of it all, but collusive fraud is much more complicated than just provider or member fraud. What is each parties level of partition, how is it measured, what actions can you take (prosecution, recovery, etc.), what is the total cost?

It appears very clear that collusive fraud in healthcare is one of the new areas where significant monies can be saved. The only question remains is, how do you do it?


About Author

Ross Kaplan

Principal Solutions Architect

Ross Kaplan serves as the Principal Global Solutions Architect for Health Care in the SAS Security Intelligence global practice. He supports health care cost containment (Payment Integrity) initiatives across the Health & Life Sciences, State and Local Government, and Federal Government verticals. He has been active across North America, Europe, Middle East, Asia Pacific and South Africa. Providing industry expertise and vision at conferences and directly to customers, Ross has been at SAS for over eight years
Ross is a 16 year veteran in the health insurance industry, focusing on analytics in health and condition management, member retention, and provider profiling prior to specializing in health care. He has assisted health plans, federal and State and local government agencies in defining their requirements and providing guidance in their solution advancement. Ross is also trained and experience in Healthcare privacy laws.
Prior to SAS, Ross served as a solutions architect at Computer Associates and Siebel Systems, working with the Fortune 1000. He has supported other industries such as Insurance, Banking, and Pharmaceutical. However, his primary focus has always been in health care, receiving training in HIPAA and having direct input in Siebel’s health care product development.
Ross has been featured speaker at many industry events focused on health care cost containment and payment integrity, most recently on the topic of social network analysis and link analysis, predictive analytics, and fraud/waste and abuse in the European market.
Ross earned a bachelor’s degree in Business Administration, with a concentration in Computer Information Systems (CIS) from San Francisco State University and his Master’s Degree in Statistics as well as an MBA with a concentration in Systems Analysis.

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