How can this Fraud happen?

You, the Patient, have no healthcare insurance and “borrow” or “steal” someone else’s healthcare Insurance card. You go to a Doctor as a first time Patient and use this stolen card. The diagnosis is that you need a full knee replacement which can be very costly. Using stolen patient IDs the provider submits claims for services never rendered. Submitting claims with reimbursement checks to be sent to P.O. Boxes, commercial mail holding businesses, prisons, etc. Referral rings that send patients to providers who bill unnecessary services or prescribe unnecessary drug treatments You are a Home Healthcare provider and complete 2 home care visits and bill the carrier for 8 visits.

But Why?

No Prevention ——Current anti-fraud systems offer virtually no mechanism for preventing fraud. The best they can offer is early detection.

Abysmal Detection Rates——Current anti-fraud systems have a detection rate estimated at 10% of fraud. Their detection rates for Abuse & Waste are even lower.

Horrific Recovery Rates——Even when fraud is discovered, the recovery rate is ~ 7% due to “Pay and Chase” systems used by health insurance carriers. For phantom-billing fraud, it is too costly to prosecute most frauds. For card-sharing fraud, it is impossible to take back services from the fraudulent patient.

Top three companies in the Healthcare fraud space —— all do the same thing with regards to stopping healthcare fraud. They do predictive and descriptive modeling; retrospective rules based investigation, data mining and analytics and a lot of other long and technical names aimed at stopping fraudulent claims from being paid AFTER the services have been performed——this is referred to as “Pay and Chase