April 26, 2013

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FWA – A growing menace

Healthcare fraud is an intentional deception or misrepresentation made by a person or an entity, knowing that the misrepresentation could result in a payment to which the person or entity is not entitled. As healthcare fraud is seamless, it tends to blend making detection a challenge.

Fraud detection and prevention tools are no longer a “nice to have” but a critical element for sustaining the business. The damages incurred due to health care fraud has increased exponentially over the past few years. To reap the advantages of health care reform it is essential to strengthen fraud, waste and abuse protocols with strong processes, tools and services.

The National Health Care Anti-Fraud Association (NHCAA) estimates that the financial losses due to health care fraud are in tens of billions of dollars each year. As per the numbers provided by the Federal Bureau of Investigation[Ref], fraud, waste, and abuse account for 3 to 10 percent of the total health care expenditure. These losses lead to a causal system where increased health care costs are met by a surge in cost of coverage. The disproportionate surge of coverage as against income burdens the end customer.

The comprehensive solution to this issue is a two-pronged approach. Many organizations are not adequately staffed to review the high volume of claim activity that requires validation.

There is a need to provide aid in designing processes and services for claim validation, tracking, and recovery services to interpret the data output from their traditional tools, such as rule engine, scoring models. This would help in dealing with the volumes of claims that require validation leading to potential recovery of losses.

HCL offers an experienced professional claim validation and recovery management team that is capable of auditing high claim volumes. This team can either compliment a health plan’s current staffing or act as a completely outsourced unit for the plan.  If health plans do not have appropriate fraud detection tools in place, HCL along with its partner vendors can offer tools that aid in the identification and detection of FWA claims and links.   

Find out more about our FWA solutions in our next blog…