Fraud-fighting efforts save NJ insurer $43.2M in 2015

Magnifying glass highlighting the word fraud

Using a combination of data analytics and “smart detective work,” Blue Cross Blue Shield of New Jersey (BCBSNJ) says its fraud detection and prevention efforts saved more than $43 million in 2015.

Last year’s savings--which includes recoveries and losses avoided--brought the insurer’s total antifraud savings to $290 million over the last decade.

BCBSNJ highlighted the importance of collaborating with investigators in other states to preempt potential schemes that might be trending in other regions of the country. Last year, New Jersey investigators noticed a spike in providers creating shell, or “phantom,” offices to bill for nonexistent medical care. Investigators also noticed an uptick in physicians that billed for hundreds of patients in one day, dubbed “the impossible day.”

“Healthcare fraud remains a major problem for not only Horizon but for health insurers nationwide, so we are especially vigilant to protect our members from fraud activity that may migrate to New Jersey from other states,” Douglas Falduto, vice president of administration and chief security officer for Horizon BCBSNJ, said in the announcement.

BCBSNJ opened nearly 1,000 new fraud cases last year and referred 187 cases to state authorities, including the New Jersey Attorney General’s Office. Falduto credited the investigative unit’s success to a combination of state-of-the-art detection technology, a “no-tolerance approach” to fraud, and traditional investigative techniques.

Government officials credited data analytics in last month’s historic fraud takedown that arrested 301 people, adding to a growing perception that predictive analytics is an integral part of detecting sophisticated fraud schemes. Other fraud investigators have lauded the combination of analytics and investigative “street smarts.”

- read the BCBSNJ announcement