Fraud Prevention

We Fight Fraud

Fraud is an intentional deception or misrepresentation that the individual knows to be false or does not believe to be true and that the individual makes knowing that the deception could result in some unauthorized benefit to himself/herself or some other person.

Health insurance fraud is a quiet crime. There aren't any sirens or guns. The only victims are the American taxpayers, and most don't even realize they are being ripped off (e.g. a provider billing for services that weren't rendered).

Health care waste occurs when there isn't any intent to deceive for a monetary gain (as in fraud), but there is inappropriate utilization and/or inefficient use of resources (e.g. billing improper codes or billing separate services that should be bundled under the same code). Health care waste can lead to higher health insurance premiums or greater government spending.

Health insurance abuse occurs when an individual or entity unintentionally provides information to a health insurance company that results in higher payments than the individual or entity is entitled to receive (e.g. a provider's belief is that every patient should receive an x-ray every time they have an appointment).

Health care fraud is a major concern of ours and the entire health care industry. Some important facts about health insurance fraud are:

• The National Health Care Anti-fraud Association (NHCAA) estimates that 3 to 10 percent of dollars spent on health care is lost to fraud.
• Annual health care expenditures in the U.S. total nearly $3.8 trillion, meaning the estimated loss to fraud is $114-380 billion annually.
• Our claim expenditure for 2014 was $19 billion, meaning our estimated loss to fraud was $570 million-$1.9 billion.Pennsylvania is in the top 6 states for cases of insurance fraud.

Financial Investigations and Provider Review

We take a proactive approach to detecting and investigating potential health care fraud, waste and abuse. Our Financial Investigations and Provider Review (FIPR) unit, a combination of the former Special Investigations Unit (SIU) and Provider Claims Review (PCR), is tasked with investigating all cases of health care fraud, waste and abuse that impacts us financially or the health and welfare of our members.

FIPR's mission is to support our company's mission of providing affordable, quality healthcare by ensuring that provider reimbursements are appropriate and by investigating and resolving suspected incidents of healthcare insurance fraud, waste or abuse to protect our company's assets. The department accomplishes this by utilizing data analysis techniques to identify aberrant claims, applying claim coding reviews and a variety of investigative techniques to assess the appropriateness of the provider payments and pursuing recoveries as necessary.

The role of the FIPR unit is to detect and investigate alleged fraud in all lines of business, generated both internally and externally. FIPR also conducts investigations involving Medicare C & D and internal investigations involving employee fraud.

A successful fraud prevention program requires the identification, investigation and resolution of potential fraud occurrences utilizing the following:

• Fraud referrals from members, employees and providers
• Strong active relationships with law enforcement personnel who receive information from FIPR to support their criminal investigations regarding potential health care fraud
• Continual analysis of health care claim patterns and investigation of any red flags like high claim utilization in a given day or provider billings that greatly exceed the normal billing pattern generated by comparable providers

Types of Fraud Investigations

• Provider fraud (billing for services not provided, billing for a more costly service than one performed, billing each stage of procedure as if it was separate, billing for a provider's services outside of the provider's practice, issuing kickbacks, billing for non-covered services or making a false diagnosis, setting up phony clinics to generate false claims)
• Subscriber fraud (allowing someone else to use your insurance card or your spouse's card, using an insurance card that has been cancelled, placing ineligible dependents on your plan, asking the provider to falsify a report to receive a non-covered procedure, asking a provider to waive a copayment, forging receipts from a provider to get reimbursement from the insurer)
• Pharmacy fraud (using multiple pharmacies to get more drugs, using different prescribing providers, submitting false prescriptions, altering pharmacy receipts)
• Employee fraud (misrepresenting information on an enrollment application, placing ineligible dependents on your plan, accessing employee data or PHI without authorization)
• Group fraud (ghost employees or non-existent employees, subscribers that aren't employees, part-time employees, ineligible dependents)

Sources of Evidence

• Checks
• Claims
• EOBs (Explanation of Benefits)
• Contracts
• Policies
• Billing patterns
• Data analysis
• Provider education
• Undercover operations
• Interviews
• Medical records review