Medicare and private health plans increasingly are "mining" claims data for potential fraud with the help of sophisticated computer technology, USA Today reports. Fraud accounts for an estimated 3% to 10% of the $2 trillion spent annually on health care in the U.S. Within the past few years, companies including Fair Isaac; IBM; ViPS; and Ingenix, a subsidiary of UnitedHealth Group, have developed software that detects suspicious patterns in claims data. Kim Brandt, director of program integrity at CMS, called the method "spider-webbing: Find one common denominator (and follow the thread)" (Appleby [1], USA Today, 11/7). Red flags indicating possible fraud include medical providers charging more than peers; providers who administer more tests or procedures per patient than peers; providers who conduct medically "unlikely" procedures; providers who bill for more expensive procedures and equipment when there are cheaper options; and patients who travel long distances for treatment. Aetna said its fraud-detection software helped the insurer prevent more than $89 million in fraudulent reimbursements from being paid last year, compared with $15 million it was able to recover after fraudulent payments were already made. Companies are able to save far more money by detecting fraud before claims are paid than recovering the money after the fact, according to USA Today. However, some doctors are critical of prepayment fraud detection because they say claims are evaluated by subjective factors such as whether a patient is being overtreated or seen too frequently (Appleby [2], USA Today, 11/7). Edward Hill, the American Medical Association's immediate past president, said the detection systems need to better distinguish fraud from inadvertent billing errors or legitimate medical treatments (Appleby [1], USA Today, 11/7). Chris Door, director of anti-fraud and recovery solutions at Ingenix, said, "We have to be very precise in the claims we want to stop." Mike Stergio of Aetna noted that the majority of medical providers are honest. "The hard part is finding [fraudulent providers] among all these good people and at the same time not branding everyone out there as bad," he said (Appleby [2], USA Today, 11/7).

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