Protect the Integrity of the Public Purse

Share this post:

Authored by: Doug Plaxton and Thomas Nisbet

Security and threat concerns are particularly on top of the mind of departments for border control, public safety and national security.  Fraud is affecting all industries and segments of the market from social security benefit fraud, healthcare claims fraud and tax fraud to commercial banking, anti-money laundering and insurance claims fraud.  In the healthcare industry alone, economists estimated that health insurance claims fraud reached upwards of $272B in 2014.  Organizations can lose between 3-10% in healthcare claims fraud annually, costing billions to tax payers and private citizens.  State agencies are looking for solutions.

North Carolina Department of Health and Human Services

North Carolina Department of Health and Human Services faced a significant exposure to healthcare fraud.  The current business process and technology used to fight fraud, waste, and abuse in Medicaid showed ineffectiveness in producing recoveries.  This leakage, combined with a significant state budget deficit, motivated the state to aggressively pursue cost takeout projects. The state implemented a comprehensive fraud analytics solution, based on IBM technologies. For its fraud detection, the state is using two IBM applications: IBM Fraud and Abuse Management System (FAMS) and IBM InfoSphere Identity Insight to analyze nearly 60,000 providers, 2 million Medicaid patients and $12 billion in claims.

healthcare claims fraud

IBM Identity Insight performs network and identity analytics to detect fraud rings and identify fraudulent individuals within the program.  IBM FAMS performs behavioral analytics, mining data to detect provider billing patterns of fraud, waste, and abuse. Together, they are able to identify suspect Medicaid claims for potential recoupment, fraud referral or prepayment suspension; as well as screen incoming applications against watch lists.

The solution has identified organized criminal rings and collusive behaviors. By reducing this cost, the state can enhance the standard of care delivered via the Medicaid program for residents, while improving efficiency with the power of analytics.

The solution has been used to achieve significant results:

  • Hundreds of provider cases sent for post payment recovery
  • Over 100 referrals to the Medicaid fraud Control Unit
  • Dozens of providers suspended through the Prepayment Review program, resulting in saved dollars through cost avoidance
  • Providers terminated from the program or denied enrollment via application screening

Unfortunately, fraud is ubiquitous and the public sector is under siege.  Departments are facing increased financial constraints and need a systemic solution to protect the integrity of the public purse.  State Health and Human Services across the country and around the world may face vulnerability if they’re not taking steps to act before fraud is committed.  Forward-thinking agencies are employing advanced analytics to mitigate threat and maximize tax dollars with insightful prevention instead of revenue loss and cutting programs.

For more information on how IBM is making significant investments and advancements in data analytics, visit the InfoSphere Identity Insight web page.

Worldwide Sales for Identity Insight and Global Name Recognition, IBM

More Healthcare stories

The future of disease management – the opportunities and challenges of digital interventions

Today’s industries are being disrupted by software-driven innovations, as evidenced by Amazon’s impact in retail markets, Netflix’s success over traditional cable providers, and the upheaval in hospitality industry from online marketplaces such as Airbnb. It is hence no surprise that the healthcare industry is seeing a surge in the development of software driven products to […]

Continue reading

Advance precision medicine with trusted data and AI solutions

Advancing precision medicine to improve diagnoses and treatments relies largely on big data coming from many sources and instruments in volumes that we have never seen before. This exploding growth of data, represented by very large files and many complex data types, pose enormous challenges for researchers that are trying to make sense of all […]

Continue reading

Predictive Modeling for Pharma Marketers: The Personalization Prescription

There’s massive opportunity in the $1,200 billion world of pharmaceutical marketing, and substantive shifts are underway as big data increases scope and narrows focus. Pharma marketers now face the challenge of combining high-level, abstract knowledge with personalized recommendations tailored to patient and health care provider (HCP) needs. Existing sales strategies and current categorization methods are […]

Continue reading