5 Steps to Reducing Fraud, Waste and Abuse

Nov 10, 2020

Use these tech-enabled tips to comprehensively reduce FWA.

States require MCOs to take proactive measures that reduce not just fraud, but also waste and abuse. But how can you ensure your efforts not only meet compliance requirements but also help secure a competitive advantage? Through the lens of a total payment integrity solution like Pareo, successful comprehensive FWA management is achievable. Let’s dive in a little deeper and look at the most innovative steps that payers and health plans can take to reduce fraud, waste and abuse and maximize plan savings in 2020 and beyond.

1. Analyze your post-adjudicated and post-pay claims data.

Because Medicaid MCOs are administered at the state level, federally governed program integrity tactics and guidelines remain a challenge, says this 2019 report to Congress. But health plans and payers seeking to establish payment integrity in their program can look to this clue, provided by the referenced report, where the Commission recommends payers implement technology and processes appropriate to assessing their payment integrity performance. Specifically, “data systems capable of storing and analyzing patterns of claims data but also personnel with statistical, medical, and investigative expertise.”

This indicates that the Federal government will become increasingly interested in the analytics of claims data, including how financial responsibility was determined (post-adjudicated) and paid for (termed post-pay). Therefore, health plans, providers and MCOs must affix data-driven insights to the success of their FWA programs. Pareo makes available post-adjudicated and post-pay claims data for analysis and reporting efforts, and you can automate the mandated reporting of the effectiveness of your anti-fraud measures specifically.

2. Intelligently flag potential fraud, waste and abuse claims.

Does your FWA solution have the ability to flag potentially problematic claims in real-time? Does it autonomously flag potential fraud, waste and abuse claims at all, which prevents them from escalating into million-dollar mistakes? Pareo offers real-time flagging to assist health plans and payers in identifying and deterring claims that signal waste as well as multi-tiered provider scoring that indicates potentially fraudulent or abusive billing patterns.

Preventive measures allow a plan to take immediate proactive steps to reduce fraud, waste and abuse, which are a large portion of the improper payment rates reported by CMS (last year averaging about 10%). A 2019 study published in JAMA found that approximately 25% of U.S. healthcare spending is waste. Of that, conservatively, clinical waste totaled 27% and fraud and abuse 7.6%. Total payment integrity solutions like Pareo provide a powerful platform for health plans looking to prevent and recoup these costs.

3. Automate auditing workflow.

There are several regulatory steps for claims auditing procedures, many of which can be automated with an advanced technology platform. Among the most useful provided by total payment integrity solution Pareo include:

  • Initialization of medical records requests which triggers a nurse audit review
  • Medical records details included for nurse audit review process
  • Aggregation of insurance claims data
  • Overpayment tracking
  • Overlap control – both preventing suppliers from working claims outside of their assignments and excluding active fraud cases from audits

These streamlined workflows increase auditor productivity 3x and contribute to 5% lower administrative costs for Pareo clients. Reducing the administrative burden for a health plan or payer allows for staff to focus on other higher-value tasks associated with cost containment goals. Also, a health plan can avoid the negative consequences seen by older payment integrity solutions that introduce unnecessary friction into the payer-provider relationship.

4. Integrate program integrity efforts end-to-end.

As the industry moves away from “pay and chase” activities into more proactive measures, program integrity processes that emphasize a 360-degree approach to cost containment and reducing fraud, waste and abuse should be the goal for health plans. This comprehensive model should integrate prepay to post-pay, internal to external, audits to provider, recoveries to posting, and payment integrity to the SIU for an end-to-end solution.

Technology platforms like Pareo offer intuitive processes and integrations for all stakeholders within the common framework:

  • Configure timelines appropriate to prospective or retrospective provider audits and easily apply successful post-pay concepts to the prepay process.
  • Increase transparency in the payer-vendor relationship to improve the audit assignment, concepts approval and invoicing process while maximizing effectiveness of internal and external resources.
  • Automate the refund letter request process, including supporting clinical information; streamline the provider communication and education feedback channel; and close the loop on recoveries and posting to reduce provider abrasion.
  • Share valuable provider and claims auditing information between payment integrity and the SIU.

Optimizing your avoidance and recovery efforts is just one of many ways to reduce fraud, waste and abuse.

5. Optimize with predictive analytics and A.I. capabilities.

“It is important to note that while all payments made as a result of fraud are considered ‘improper payments,’ not all improper payments constitute fraud,” writes CMS in an annual report for Congress dated from 2015. Distinguishing between the two is essential to reducing provider abrasion and false positives that can overwhelm the SIU, and integrating multiple relevant data sources can help with this distinction.

In their most recent report, dated November of 2019, CMS announced an initiative to keep unscrupulous providers out of federal insurance programs (known as Program Integrity Enhancements to the Provider Enrollment Process). Combined with the collaborative Healthcare Fraud Prevention Partnership already in place, it’s clear that information sharing designed to create an environment unfriendly to fraud schemes and support predictive analytics is the goal.

Health plans looking to minimize improper payments due to fraud, waste, and abuse should also take advantage of the power of predictive analytics. Pareo is an accessible platform that offers health plans and payers predictive analytics and applications of A.I. like deep learning capabilities designed to prevent and reduce FWA. In fact, many of the outstanding qualities of Pareo are in line with the proactive measures CMS is taking to prevent improper payments.

Pareo Meets You Where You Are So You Can Quickly Reduce FWA

If you think a comprehensive payment integrity and FWA technology platform that leverages the power of A.I. is only available to health plans heavily resourced with time, money and personnel, think again. Pareo offers unparalleled configurability and a unique outsource-to-insource model that allows you to take advantage of proprietary concepts and tech-enabled services to maximize your internal resources over time.

ClarisHealth designed Pareo as a total payment integrity platform unlike any other available on the market. By leveraging innovative technologies with a singular, user-friendly interface, our clients have seen dramatic improvements in their ability to reduce fraud, waste and abuse


Now’s the time for total payment integrity

See the ClarisHealth 360-degree solution for total payment integrity in action.

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