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Insurance fraud, waste, and abuse are major factors in
the rising cost of health care in America today ? costing
consumers as much as $1 out of every $7 spent on
health care. The Corporate and Financial Investigations
Department (CFID) at IBC is doing its part to address
this problem by identifying, investigating, and reporting
suspicious cases of abusive practices to law enforcement
authorities. In addition, recovery of overpaid claim dollars
is pursued, regardless of the reasons.
2011 in review
Last year the CFID received 986 allegations of fraud,
waste, abuse, or aberrant billing practices, with 116 of
these allegations coming from providers or members.
Because of these allegations, 106 fraud and abuse
investigations were initiated. Additionally, audits of
116,106 hospital claims and over 247 professional and
ancillary service provider audits were conducted, as well
as over 3,550 pharmacy drug utilization desk audits and
549 pharmacy retail site audits. Evidence gathered in 2011
resulted in 42 referrals to law enforcement or regulatory
authorities. Of this number, five pertained to members,
13 to doctors, and eight related to prescription fraud.
Trends and results
Through the use of sophisticated data mining software
tools, the CFID analyzes all claims submitted by medical
providers, facilities, and pharmacies and compares
them against member enrollment data and overall
provider information. Trends, patterns, and aberrant
billing practices are selected for in-depth audits or
investigations. The most often used fraud schemes were:
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billing for services not rendered;
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"up-coding" procedure codes on claims submitted in
order to receive a higher reimbursement;
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prescription fraud.
Because of the investigations and audits performed
by the CFID, over $58.9 million was recovered with an
additional $6.8 million in overpaid claims identified but
not yet recovered. Grand jury indictments and criminal
information filings were brought against 23 individuals
last year. Eleven individuals pled guilty or were convicted
of health care fraud violations and received probation or
incarceration ranging from six to 120 months in prison.
We need your help
Although the CFID continues its efforts to ensure that
health care costs are appropriate, we still need your help.
The data mining software tools and fraud hotline both
provide valuable leads, but there is no substitute for your
own vigilance. Allegations received from our provider
community are extremely valuable, and we ask you to
contact the CFID if you are suspicious of any health
care activity. To do so, please call our toll-free Fraud and Compliance Hotline
at 1-866-282-2707 or go to the Anti-Fraud
page on our website
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