New Center for Medicare & Medicaid Services' predictive analytics will help the agency meet its goal to prevent fraud, but the program suffers from inconsistent data and flawed methodology that make it impossible to track inaccuracies, according to the Office of the Inspector General, under the U.S. Department of Health & Human Services.
This is the first year CMS is using predictive modeling and other analytics in its Fraud Prevention System (FPS), and it shows, according to an OIG report, released to the public today. To improve results, the Inspector General recommended CMS:
- Require contractors to track money recovered from following FPS leads
- Coordinate with law enforcement to better report outcomes of cases referred from FPS
- Revise its methodology for calculating projected savings from improper payments to recognize that not all claims from a revoked provider are necessarily false and that some previously denied claims may eventually be paid
- Revise the methodology for calculating costs avoided to verify certain information and to include costs associated with the FPS
In its report to Congress, CMS agreed to improve its savings methodology. In addition, it said it already had:
- Improved how it tracked recoveries of overpayment and better estimating law-enforcement recoveries
- Found ways to minimize or eliminate deficiencies in manual data reporting
- Evaluated a possible fix for systematically accounting for legitimate services and claims overturned on appeal
- Incorporated costs identified by OIG in calculating return on investment
CMS noted that the FPS "generated leads for 536 new fraud investigations, provided new information for 511 pre-existing investigations, and triggered thousands of provider and beneficiary interviews to verify legitimate items and services were provided to beneficiaries."
CMS said it is the first federal agency to use predictive analytic technology on a large-scale purpose to identify fraud, waste and abuse.
CMS came under fire just last month by the Government Accountability Officer for falling behind in developing the predictive-modeling system, including integrating with its payment-processing system. The GAO also said CMS had not yet defined or measured quantifiable benefits of performance goals.