Fraud Prevention System yields nearly $3 for every dollar spent

A report released by the OIG Tuesday indicates that the Centers for Medicare & Medicaid's (CMS) Fraud Prevention System (FPS) resulted in more than $133 million in adjusted actual and projected savings within the Medicare program in 2014, translating to a $2.84 return on investment for every dollar spent on the program.

The figures were a significant improvement from last year's report, which identified $54.2 million in actual and projected savings, translating to $1.34 for every dollar spent.

The OIG determined that $85.8 million was recovered through administrative actions initiated by FPS and $47.4 million came from administrative actions in which an FPS lead contributed to the investigation. Furthermore, the report found that the system resulted in $453.9 million in unadjusted savings. This includes actual and projected savings identified by the FPS that may not be recovered or avoided, according to an OIG analysis.  

However, the OIG also noted that challenges remain in differentiating between actual and projected savings and that improved CMS policies would ensure contractors are able to more accurately attribute savings within the FPS, echoing the same advice the OIG offered in last year's evaluation of the system. CMS agreed with the recommendation and outlined ways to implement improved policies.

The report goes a long way in validating the efforts and resources used toward setting up the FPS. From the outset, the system was criticized for failing to report actual and projected savings and cost avoidance because of inconsistencies within the data. Previous reports have indicated that Medicare fraud recoveries can be a "David-and-Goliath" fight.  

For more:
- read the OIG report

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