If your customer base is a mile wide, sometimes its tough to detect fraud when its hidden more than an inch deep. The Government Employees Hospital Association (GEHA) felt that way. GEHA is a national health plan serving federal employees, retirees, and their dependents. With subscribers spread throughout the country, traditional fraud detection systems werent doing the job for GEHA.
Bob Greene, manager of data analysis for GEHA, believes traditional fraud detection systems need a reasonable number of claims from the same healthcare providers to determine if those providers were being honest in their billing. We dont have a significant share of claims per physician, says Greene. For systems that are heavily dependent on rules, this was a significant problem we struggled with for a number of years.
With policyholders so spread out and nearly half of their claims submitted electronically, Greene felt better detection was needed because adjusters were no longer handling the paper they once used and didnt get the feel of the paper claims.
GEHA signed up with Fair Isaac (then known as HNC Software) at the end of 2001. Greene says he was familiar with the neural network technology the software company used, and GEHA was pleased to take part in the pilot program that Fair Isaac ran through the summer of 2002. The system, known as Payment Optimizer, used GEHAs own claims, not external benchmarks or comparisons, to develop its procedures. The system adapts to the local environmenthow GEHA codes, processes, and handles claims. You dont have to tell it by rule that you apply certain types of CPT modifiers and dont use others, says Greene. The neural network trains on your data and learns it for itself.
Payment Optimizer is a comprehensive healthcare fraud, abuse, and loss-control solution for Medicare, Medicaid, and commercial insurers. The system offers detection, review, analysis, and case management components that leverage Fair Isaacs advanced science and a variety of proven proprietary technologies to detect fraud and abuse before they can cause significant losses. The solution detects fraud and abuse patterns across a range of provider types and program areas, as well as costly fraud schemes that historically were too complex or well hidden to find. Payment Optimizer can be deployed on site to integrate with current IT systems or implemented through Fair Isaacs ASP services.
Greene offers an example of one discrepancy that would likely have gone unnoticed prior to Payment Optimizer. He says GEHA received a global bill for maternity services. Such a bill usually is received in the third or fourth month of a womans pregnancy. Several months later, GEHA received a second global bill for the same policyholder. We didnt necessarily see this as fraud, he says. It could have been a benign billing. A traditional [fraud detection] product would not necessarily have the ability to detect this type of duplicate, or it would have been very challenging using a rules-based system. Youd essentially need to know what you were looking for.
An extra benefit of the system allows GEHA to go after suspected fraud in some of the medium- and small-dollar claims. In the past, we pursued cases after the claims payment went out the door, says Greene. We didnt put resources into pursuing the questionable $50 claim because there were a certain amount of handling costs associated with pursuing such claims. It was very difficult to make money out of this type of process.
The pilot testing sold GEHA, and the system went into full production in April. Given that we dont have a large base of enrollees, and physicians are not in a concentrated area, it was more difficult to get that ROI with a low density of data, says Greene. We looked at other approaches and havent been able to make those solutions work. But this will work, and if it can work in our environment, it can work in other plans.
CaseFile
The Problem: A fraud detection system was needed for a health insurer with policyholders spread across the U.S.
THE COMPANY: Government Employees
Hospital Association
Subscribers: 230,000 health plan
subscribers
WEB SITE: www.geha.com
The SOLUTION: Payment Optimizer
from Fair Isaac
WEB SITE: www.fairisaac.com
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