HHS' inspector general's office has issued a draft rule that would allow states to use federal funds to help identify instances of Medicaid fraud.
The proposed rule would amend a current HHS provision that prohibits state Medicaid fraud control units from using federal dollars to fund efforts to electronically sort claims looking for evidence of fraudulent practices.
In the rule, published in today's Federal Register, the inspector general's office notes that current restrictions force states to rely on referrals to investigate potential fraud. Also, according to the inspector general's office, data-mining has proved to be an effective anti-fraud tool for the federal government.
"We anticipate that data-mining by MFCUs at the state level could enhance the (units') ability to counter new and existing fraud schemes by more effectively identifying early fraud indicators," according to the inspector general's office. "In addition, data-mining would equip MFCUs with more modern tools that have been shown at the federal level to help increase the numbers of credible investigative leads, pursue recoveries, and detect emerging fraud and abuse schemes and trends."
The rule would also require states to provide the inspector general's office with yearly data about data-mining costs, the number of cases generated and the outcome of those cases.