Health care fraud will come at employers at an alarming rate, in part because the Affordable Care Act opens insurance up to millions of people who have little or no experience buying health insurance.
So said Chuck Whitlock, an investigative journalist and fraud expert, during a session at this week’s International Foundation of Employee Benefit Plans annual conference.
“When you open up the floodgates to large numbers of people who aren’t accustomed to dealing with a new deal, fraud runs rampant,” he said. “For every person who’s not experienced, who doesn’t know how to go online, who doesn’t know what to expect, who’s relying on someone else to help them, you’re going to have fraud.”
Whitlock said the common areas of fraud include the misrepresentation of services provided, providing unnecessary services, billing for services not rendered and sale of durable goods.
“It’s all about putting in systems. And you’ve got to do it now because you’ve got everybody in the world [who’s] going to be insured, doctors’ offices are going to be backing up and people are going to be making legitimate mistakes left and right,” he said. “You’d better have systems so you can pick it up.”
Whitlock also warned of the huge liabilities facing employers and health plans if members’ personal health information is breached. “Never let your employees leave the office with a laptop,” he said. “[It’s the] primary way of getting patient/member data. … a policy has to be in place.”
He suggested five ways employers can minimize fraud in their health plans:
1. Train everybody on your team to recognize fraudulent documents. For example, “when you’re looking at [identification] issued by the federal government, you will normally have security features in each of those documents you should look for,” said Whitlock. “You can be found guilty of hiring an illegal alien and pay a very hefty price if you don’t verify the person you are hiring is actually a U.S. citizen. You need to be able to check the documents and authenticate them.”
2. Systematically test common upcoding against all bills. “Have a system, and if you don’t have one, hire an outside company to do it,” he said. “So many companies have this capability. … how good of a job they do is often dictated by what you ask for in the contract so negotiate a tough contract and demand they police upcoding and catch fraudulent activity.”
3. Empower your plan members by making it easy to report suspicious behavior through a fraud line. “People have ‘report fraud’ lines where they use third parties — why can’t they report to a third party you contract with if they suspect fraud is going on?,” he said, adding employers may want to consider giving the fraud line information to their providers as well.
4. Hold staff meetings about the four common areas of fraud and issue a fraud card listing the four areas, along with the fraud line number.
5. Sign up to receive the FBI Medical Fraud Alert Warnings. “They have an alert that will tell you some of the latest scams,” he said.
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