As the Senate prepares to consider the confirmation of a new HHS inspector general, insurance fraud is growing as a priority for private payers.
Last week the Chicago-based Blue Cross and Blue Shield Association announced that Blues plans saved or recovered nearly $240 million in 2003 through the association's antifraud efforts.
That figure, consisting of $122 million in court proceedings, voluntary repayments and settlement recoveries and $117 million in money saved through prepayment review and other stopgap measures, represented a 52% increase over the previous year.
Byron Hollis, the Blues association's national antifraud director, said the plans received more than 69,000 tips of fraud and their special investigative units opened nearly 20,000 investigations last year. In April 2004 the association launched its own antifraud strike force, which is composed of investigators from 11 Blues plans and coordinates cases throughout the Blues system.
Hollis said in spite of the payers' efforts to fight fraud, it is on the rise. "We had a 66% increase from 2002 to 2003 in dollars identified as paid inappropriately because of fraudulent claims," he said. "And that's in a year in which we increased our antifraud staff by 30%."
Highmark's private-insurance fraud unit attributes roughly 70% of its fraud recoveries to facilities like hospitals, nursing homes, clinics and outpatient centers; 25% to healthcare providers; and about 5% to members, said Tom Brennan, special investigations director for the Blues plan.
Brennan said the most disturbing trend he's seen is a rise in unnecessary surgeries and procedures performed on patients, a trend that affects the quality of care.
Hollis said 10 years ago the relationship between private plans and government fraud fighters was "a one-way street."
"We'd supply the information about perpetrators to the inspector general and we'd never hear anything back," Hollis recalled.
But since the passage of the Health Insurance Portability and Accountability Act of 1996, cooperation has increased, and the plans and the government offices now regularly exchange information through local task forces.
"We know we can't do it alone and they know they can't do it alone," he said. "What we need is a partnership between payers, providers and the government. The time has come to put a stop to healthcare fraud. The amount of money paid out by each individual annually is becoming cost-prohibitive."