CMS enters tech pact to reduce Medicare claims fraud

The Centers for Medicare & Medicaid Services (CMS) has contracted with aerospace and defense technology company Northrop Grumman to create a predictive model that is expected to cut down on fraud.

The program, which will go into effect on July 1, will scrutinize claims for any odd patterns that could suggest fraudulent submissions. It is part of a wide initiative by CMS to cut down on waste and inefficiency, which has included more close verification of Medicare vendors and participants.

At an anti-fraud summit in Los Angeles last September, Health and Human Services Secretary Kathleen Sebelius had promised that a real-time claims verification would be put into place, but did not offer specific details.

"In the past, you submitted a claim, it was paid immediately, and any issues that came up would be discovered later," CMS spokesman Jack Cheevers told FierceHealthFinance. "Now, those claims will be verified prior to payment." He likened the initiative to anti-fraud protections put in place by major credit card companies and banks.

The Medicare program processes a huge amount of claims, about 4.5 million per day. Because of the volume, "we cannot wait for tips to come in," said Sebelius, notes the Federal Times.

Terms of the pact with Northrop Grumman, which built the B-2 bomber for the U.S. military and has undertaken a variety of other defense projects, was not disclosed, although CMS has earmarked $77 million toward the project.

For more information:
- here's the CMS press release
- read the Federal Times article

Suggested Articles

Employers are making adjustments to their health benefits in the wake of COVID-19, but workers may not take the time to consider these new options.

Here's why analysts and industry leaders think the Teladoc-Livongo deal could significantly change the virtual care market and healthcare delivery.

Oak Street Health officially went pubilc on Thursday with a $328 million initial public offering.