Fraud and Abuse
The United States Government Accountability Office reported more than $38 billion dollars were improperly spent in 2005 for federal programs such as food stamps and Medicaid. Experts believe the real number is far higher and may possibly approach $100 billion each year.
In response to these staggering numbers, Congress has passed laws such as the Improper Payments Information Act of 2002, and the Deficit Reduction Act of 2005 – requiring states to put real teeth into enforcement efforts.
States have responded by increasing the scrutiny of expenditures and attempting to reduce the numbers of improper payments made due to errors, fraud, and abuse. These efforts have ensured that money appropriated for important healthcare programs for children and elderly Americans goes to these individuals. But these efforts have been only partially successful.
Most state program integrity efforts have centered on post-payment reviews – claims, providers, and recipients. Industry experts believe that these “pay and chase” efforts are costly and inefficient.
Pre-payment deterrent efforts such as prior authorization of services are designed to stop these potential improper payments before they are made. Now advanced techniques for speedy analysis of medical service, provider, and recipient data are available. These quick and accurate techniques enhance the effective deterrent of prior authorization with far less impact on the “good” actors – those providers and recipients whose behavior merits quick approval and timely payment.