by Sidney Marr
A Deep Dive Into the Issue
According to industry estimates, the total dollar amount of medical plan overpayments nationwide could be as high as 1/3 of total medical claim expenditures annually. Anti-fraud initiatives are important to benefits plans today and it is critical that health plan and claim administrators comply with all applicable federal laws, ERISA and PPACA claims regulations, as well as statutory fiduciary duties.
Successful industry overpayment recoveries have reached into the trillions and involved many large carriers for some of the nation's largest self-insured health plans.
A Closer Look: Waste, Fraud, and Abuse
The Institute of Medicine conducted a study on waste in the U.S. health-care system and concluded that 25% - or $750 billion - of all spending is waste.
The Coalition Against Insurance Fraud asserts that we lost $487 billion to fraud and human error in a single year, comprising about one-fifth of the total cost of healthcare. In 2018, the largest multi-agency health fraud takedown in history uncovered an elaborate scheme costing vital Medicare programs $2 billion. The case involved 600 defendants (many of whom were medical professionals) across 58 federal districts.
Research suggests that only 5% (or even less) of these losses are recovered annually. This impacts not only the insurers paying these claims, but more so for consumers who continue to shoulder the burden of healthcare costs.
Employer Engagement and Responsibility
An employer has the fiduciary responsibility to choose the provider, as well as a fiduciary responsibility to monitor the provider. Employers are generally excellent at the first step, with room for improvement on the end. When it come to corporate board, 78% of Fortune 1000 board members are unaware that healthcare falls under ERISA regulations.
When monitoring service providers, employers should act to ensure they are performing the agreed services including:
- Reviewing the service provider's performance
- Reading any reports they provide
- Checking actual fees charged
- Asking about policies and practices (such as third-party administrators' claims processing systems)
- Ensuring proper maintenance of plan records
- Following up on participant complaints
For employers that don't recognize this fiduciary responsibility—or their plan's inefficiencies—it could be a source of significant liability for companies, and fiduciaries, including personal liability for c-suite, directors, and fiduciaries. Additionally, if boards of directors and plan fiduciaries know fraud could exist and don't take actions to rectify these issues, they could open themselves up to liability from shareholders and plan beneficiaries. Many boards build incentives for c-suite executives who control costs, and the team at Benefits Claims Intelligence brings a tool to the table to protect the board and support executive cost containment.
Using Technology as a Powerful Defense
BCI has developed supporting technology that strengthens and automates processes while placing the client in control of their medical data.
A HIPAA-conformal data platform to support deep transaction analytics with the ability to assess tens of millions of client transactions over time.
Advanced trending and metrics measures compliance with your documental plan procedures and can illuminate points and processes that need improvement.
Deep analytics fueled by machine learning and artificial intelligence, coupled with statistical analysis, designed to find breakdown points in plan policy implementation, medical provider performance, network resource allocation, and more.
It includes:
- Duplicating payments
- Overbilling
- Code and misuse: unbundling, upcoming, unlisted code use, etc.
- Clinical accuracy, diagnosis to procedure crosswalks, modifier accuracy, place-of-service, unlisted codes, etc.
- Recoup through-offset events
- FWA trending and projections
- Self-dealing
Benefits Claims Intelligence is proud to be featured on The Granite List.
To learn more about the work we do, find us here.
