Life Science Compliance Update

176 posts categorized "Congress"

April 08, 2015

CMS and OIG Discuss “The Use of Data to Stop Medicare Fraud” Before House Ways and Means Subcommittee

  Big data

The House Ways and Means Subcommittee on Oversight recently held a hearing on the federal government’s use of data analysis to confront Medicare Fraud. The hearing featured testimony from Dr. Shantanu Agrawal, Deputy Administrator and Director of the Center for Program Integrity at the Centers for Medicare and Medicaid Services (CMS) and Gary Cantrell, Deputy Inspector General for Investigations at the Office of Inspector General (OIG).

Medicare fraud “remains a serious, evolving threat,” Ways and Means Oversight Subcommittee Chairman Peter Roskam (R-IL) began the hearing. "I want to emphasize just how big of a problem this is. Last year, the federal government lost $124.7 billion dollars in improper payments across 124 programs. Of that $124 billion, one program accounted for $60 billion—or nearly half of the losses: Medicare.”

Pay and Chase

"Historically, CMS has used a method called 'pay and chase' in processing Medicare payments, first paying for a charge, and then later looking back to check on the validity of the transaction and potentially trying to claw back the money if the payment was made improperly,” Roskam stated. “As you can imagine, that strategy isn't very effective. Time and again we have seen fraudsters bilk the system for a few million dollars, shut down, and pop up under a new name to run their scams all over again. The Medicare program is getting outsmarted by these methods and the proof is in the unacceptably high rate of improper payments each year.”

Kirk Ogrosky, a former prosecutor and now partner at Arnold & Porter LLP, provided a concise overview of the issues at hand in his testimony. “Fraud will not be reduced or eradicated with a ‘pay-and-chase’ enforcement system that relies on criminal prosecution and civil litigation,” Ogrosky stated. “With advances in the ability to analyze claims data, the goal of the system should be to detect fraudulent claims when they are submitted, identify the perpetrators, and to use prosecution sparingly to punish and deter.”

Rep. Roskam stated: "In 2010, I proposed a new approach to help CMS work smarter. Instead of 'pay and chase,' CMS should use the same kind of cutting-edge predictive analytics technology that private companies use successfully to look at transaction data in real time and identify potentially fraudulent charges—stopping the payment before the money goes out the door.” This is similar to what private credit card companies use to identify potentially fraudulent charges and stop payments while they further investigate claims. Indeed, the panel heard testimony from Visa, a private company whose “global rate of fraud is 6 basis points—meaning 99.4 percent of the $10 trillion dollars in payments it processes globally are fraud-free.” Roskam added: “That's quite an impressive track record, and one we hope to learn a thing or two from.” 

Big Data: The “Fraud Prevention System”

The system created by CMS to incorporate data analytics to protect Medicare is called the Fraud Prevention System, or FPS. “In its first year, FPS got off to a rocky start—the Health and Human Services Inspector General could not even certify any of the system's results,” stated Rep. Roskam. In its second year, ending in July 2013, the Inspector General certified that the system had returned one dollar and thirty-four cents for each dollar invested that year, totaling around $54.2 million in savings. "Now $54.2 million dollars is a lot of money, but it is quite literally a drop in the bucket when compared to the $60 billion that Medicare programs lost last year," Roskam noted. 

CMS Testimony

Historically, CMS and our law enforcement partners have been dependent upon ‘pay and chase’ activities, by working to identify and recoup fraudulent payments after claims were paid,” Shantanu Agrawal of CMS acknowledged. “Now, CMS is using a variety of tools, including innovative data analytics, to keep fraudsters out of our programs and to uncover fraudulent schemes and trends quickly.”

He described CMS’s data tools in detail:

Since 2011, CMS has been using [FPS] to apply advanced analytics on all Medicare fee-for-service claims on a streaming, national basis by using predictive algorithms and other sophisticated analytics to analyze every Medicare fee-for-service claim against billing patterns. The system also incorporates other data sources, including information on compromised Medicare cards and complaints made through 1-800-MEDICARE. When FPS models identify egregious, suspect, or aberrant activity, the system automatically generates and prioritizes leads for review and investigation by CMS’ Zone Program Integrity Contractors (ZPICs). The ZPICs then identify administrative actions that can be implemented swiftly, such as revocation, payment suspension, or prepayment review, as appropriate. The FPS is also an important management tool, as it prioritizes leads for ZPICs in their designated region, making our program integrity strategy more data-driven.

He also described a variety of other methods for detecting a preventing fraud, including CMS’s improved coordination with law enforcement. View Agrawal’s testimony here

OIG Testimony

Gary Cantrell, Deputy Inspector General for Investigations for OIG called combatting Medicare fraud a “top priority,” and stated: “We use data analytics to detect and investigate Medicare fraud and to target our resources for maximum results.” He stated that these results have included “almost $15 billion in investigative receivables and more than 2,700 criminal actions in the past 3 years.”

OIG uses data in order to detect and investigate fraud, and to target the use of their limited resources. “OIG is a front-runner in the use of data analytics to detect and investigate health care fraud,” states Cantrell. “We use innovative analytic methods to analyze billions of records and data points to identify trends that may indicate fraud, geographical hot spots, emerging schemes, and individual providers of concern.”

He notes that at the “macro-level,” OIG analyzes “data patterns to assess fraud risks across Medicare services and provider types and geographically to prioritize and deploy our resources.” Then, “[a]t the micro-level, we use data analytics, including near-realtime data, to identify fraud suspects and conduct our investigations as efficiently and effectively as possible.”

Cantrell also walked through a particular example of how OIG integrates various strategies to fight fraud:

We combine our field intelligence with data analytics to assess vulnerabilities across the program and to deploy our special agents to investigate the most egregious cases of suspected fraud. For example, we worked with OIG’s evaluators to develop indicators of questionable billing for Part D drugs that may be associated with fraud and abuse based on our experience with prescription drug investigations. OIG evaluators designed studies using sophisticated data analytics to identify questionable billing by retail pharmacies, prescribers with aberrant patterns, individuals writing prescriptions without authority to prescribe, and Schedule II drugs billed as refills. These studies generated numerous law enforcement leads, resulting in multiple ongoing investigations. They also identified systemic vulnerabilities in the Part D program and made recommendations to CMS to better prevent fraud.

"The need to protect the Medicare program and the beneficiaries it serves from fraud and harm has never been more important," Cantrell concluded. "OIG, working with our internal and external partners, will continue using data analytics to target our resources for maximum results."  View Cantrell’s testimony here

 

February 27, 2015

New Poll Shows Majority of Americans Are Concerned About Pace of Medical Progress

Poll

According to America Speaks, a compilation of public opinion polls commissioned by Research!America, the majority of Americans agree with the central tenets of the 21st Century Cures Bill

"Majorities across the political spectrum say it is important that the new 114th Congress takes action on assuring the discovery, development and delivery of treatments and cures for diseases in the first 100 days of the legislative session (75% Democrats, 64% Republicans and 60% Independents)," states Research!America. "As Congress considers numerous proposals in support of research, including the 21st Century Cures draft legislation aimed at speeding the delivery of lifesaving treatments to patients, it is notable to see public support in favor of accelerating medical progress."

Speed Drug Approval Pic

The report found that an increasing percentage of Americans say the U.S. Food and Drug Administration (FDA) should move more quickly in order to get new treatments to patients, even if it means there may be risks. In 2015, 38% favor faster regulatory review, compared to 30% in 2013 (see the graphic to the left). Meanwhile, 25% say the FDA should act more slowly in order to reduce risk, even if it means patients may wait longer for treatments.  Another 19% are undecided on this question and 18% do not agree with either position.  

When it comes to rising health care costs, 46% say research to improve health is part of the solution, while 28% are not sure and 26% say research is part of the problem. Meanwhile, 41% say that the roughly 1.5% of government spending allocated for biomedical and health research is not enough. Nearly one-third (29%) say it is about right, 21% are not sure and 9% say it is too much.

Furthermore, 44% say they are willing to pay $1 per week more in taxes if they were certain that all of the money would be spent on additional medical research, while 32% say no and 24% are not sure.

Currently, only 27% of Americans believe the U.S. has the best health care system in the world, but more than half say it is important that the U.S. is a leader in medical and health research. Furthermore, confidence in the current system in the U.S. for evaluating the safety of vaccines and recommendation for when they should be given dropped to nearly half, compared to 85% in 2008.

 


Among the polling results:

  • 70% of Americans agree basic scientific research that advances the frontiers of knowledge, even if it brings no immediate benefits, is necessary and should be supported by the federal government.
  • 80% of Americans say it’s important that elected officials at all levels listen to advice from scientists.
  • 78% of Americans say it’s important that our nation supports research that focuses on improving how our health care system is functioning.
  • A plurality (44%) say they’re willing to pay more in taxes if they were certain that all of the money would be spent on additional medical research, and
  • More than half (53%) say it’s important to make the R&D tax credit permanent
  • 56% of Americans favor expanding federal funding for research using embryonic stem cells.
  • More than half (55%) of Americans are willing to share their personal health information to advance medical research. An even higher percentage (60%) say they will share personal health information so that health care providers can improve patient care, and 46% percent are willing to share information so public health officials can better track disease and disability and their causes.
  • 73% of Americans say the federal government should assign a higher priority to improving education focused on science, technology, engineering and mathematics (STEM) and careers in those fields.
  • Studies show that certain health problems such as diabetes, heart disease and infant mortality happen more often among minorities or citizens with lower incomes. More than two-thirds of Americans (69%) say it is important to conduct medical or health research to understand and eliminate these differences.

 View the full report:  Download AmericaSpeaks Volume 15

Research!America notes that their online polls are conducted with a sample size of approximately 1,000 U.S. adults, age 18+, with a maximum theoretical sampling error of +/- 3.2%. Data are demographically representative of adult U.S. residents. Polling in this publication was conducted by Zogby Analytics.

 

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