Things are moving quickly during the pandemic, and healthcare plans are pressured to expedite payments while identifying fraud. Healthcare FWA during COVID-19 increases the need to verify claims while preparing for the challenges ahead.

Successful fraudsters stay ahead of trends and unfortunately that includes healthcare FWA during COVID-19. In recent months, we’ve read about a doctor who administered bogus treatments in his 26 Detroit clinics, a Georgia marketer who received kickbacks for unnecessary COVID-19 tests, and various stories of individuals profiting from selling essential products that should have been used in the clinics that ordered them.

The Centers for Medicare and Medicaid reports that the CARES Act has waived or eased certain requirements to help ease the way for patient care. Free COVID-19 testing, waiving signatures to enable telehealth and suspending pre-authorizations for treatment are intended to remove barriers to care. Sadly, these also make fraud more tempting. In addition to price gouging and upcharging for services, the Office of the Inspector General found 11 percent of providers who have been barred from Medicare and Medicaid are receiving payments.

Improper payments totaled $45 billion in Medicare and $60 billion in Medicaid and the Children’s Health Insurance Program in 2019 prior to these relaxations,” health journal Health Affairs recently reported. “These numbers may increase in light of the COVID-19 epidemic, which is estimated to cost Medicare an additional $38–$114 billion in the next year, even without considering the impact of regulatory relaxations.”

Analysts predict other risks

Banking and healthcare insurance analysts are working tirelessly to anticipate other financial risks associated with the coronavirus, such as payment inaccuracy. In January 2020, the Centers for Disease Control and Prevention announced International Classification of Diseases (ICD) codes for COVID-19. As information filters down to providers who are already overstretched, many treatments are being miscoded which will have long-range effects on final billings.

Workplace injury is another area to monitor. With many people working at home, what constitutes the work area? Is it safe and are there witnesses to any reported injuries? Consider ergonomics alone, as workers use makeshift desks and workspaces.

Payers also need to pay extra attention to card-not-present (CNP) fraud during these times of physical distancing. Unscrupulous service providers may process transactions for services or pharmaceuticals that are upcharged, never delivered, or overprescribed. Payers will have to monitor for sudden changes in purchasing behavior as well.

Traditional detection versus AI models

“The COVID-19 pandemic and the ensuing pressures it has brought to healthcare providers and payers alike is exacerbating the need to verify the validity of claims coming in and payments going out,” according to analysts at Aite Group.

Traditional special investigation units (SIUs) operate rules-based systems that are hard-coded and have hundreds of algorithms. These rules are self-limiting and lose value over time as fraudulent behaviors change. The research, analysis and work to update the rules are expensive and time-consuming. As a result, 40 percent of investigated claims are false positives.

Compare that to using a single advanced-AI model. It provides its own updates through real-time, continuous self-learning and adapts to the changing behavior it observes. Advanced AI learns through the final disposition of cases and claims to identify valid claims and flag new fraudulent behavior patterns. The end result is 20x fewer false positives and only alerts that are highly likely fraud are investigated.

Advanced AI will protect your healthcare organization

Mastercard® Healthcare Solutions has a long track record of using AI to uncover fraud. With the same fraud prevention technologies we use for the financial services industry, our AI helps detect erroneous or fraudulent claims before you reimburse providers. AI models can be tailored to identify healthcare claims fraud, prescription abuse, upcharges, phantom billings, and many other FWA challenges.

Analysts at Aite Group believe “this is a pivotal moment for health plans and their FI partners to consider the landscape that will shape the years to come.” (COVID-19: Challenges and Opportunities in Financial Services, Aite Group.)

The imperative is there to find better ways to monitor healthcare FWA during COVID-19 with best-in-class solutions. Learn more about advanced AI, and how we build customized models in 6-8 weeks with our AI Express engagement process.