In the second week of November, officials from Onondaga County, N.Y., compelled 100 Medicaid recipients to obtain documentation from their physicians to justify frequent narcotics prescriptions.
The county, which includes the city of Syracuse, will pay about US$90 million in Medicaid costs this year. Officials used business intelligence and analytics tools to identify patients whose prescription totals warranted investigation for attempting to commit fraud, said Steve Morgan, the county’s executive deputy commissioner of social services.
The county began using the tools in September as part of an effort to stem Medicaid fraud, he said.
Likewise, officials in Nassau County on New York’s Long Island have launched two multimillion-dollar investigations based on data compiled using BI tools to identify potential Medicaid fraud by county residents.
Because the investigations are ongoing, Nassau County officials declined to provide more details on the suspected fraud. But they did say that the county has accumulated millions of dollars in savings since 2003, when it started using BI tools to analyze claims data.
Several counties in New York — home to the one of the nation’s largest Medicaid populations — are turning to BI tools to help cull through millions of claims to identify potential cases of fraud and misuse, said Stephen Acquario, executive director of the Albany-based New York State Association of Counties.
Before putting the tools in place, counties had no easy way to estimate what their weekly Medicare?? bill from the state would amount to, according to officials in several counties.
Albany County last month began using Salient Performance Management (formerly called Muni-Minder) software from Salient Corp. to analyze data stored in the state’s Medicaid data warehouse to detect patterns that might indicate abuse, said Beth Berlin, commissioner of the Albany County Department of Social Services.
The Salient software is designed to provide access to transactional data and other information for analysis, said Guy Amisano, president and co-founder of Horseheads, N.Y.-based Salient. The results are provided graphically to help users detect questionable activity, he said.
Albany County has appropriated $57 million to pay its Medicaid costs in 2007, Berlin said. Because that amount is so high, “we are interested in looking at the claims to determine if there is any pattern . . . of activity that is outside of the norm that would indicate that there might be a need for a more intimate review of what is going on in that provider’s organization,” she said.
Onondaga County is using the same Salient software in its effort to flesh out Medicaid fraud, Morgan said. The county paid $200,000 for it and will pay $30,000 annually for maintenance, he said.
The county hopes that fraud investigations, like the ongoing analysis of prescription data, will result in some recipients being placed in less expensive Medicaid programs that limit their treatment to a single doctor and a single pharmacy.
Nassau County has been using statistical analysis and data mining tools from Chicago-based SPSS Inc. for three years, said Peter Clement, assistant commissioner of the county.
The county first used the tools to examine claims filed by transportation companies for the cost of bringing recipients to doctor’s appointments. The result: The county identified $50,000 worth of transportation billings for 2003 that had no matching treatment claims, Clement said.
He noted that the 40 companies providing transportation today “all know we are monitoring it now and [are] looking at [claims] through these different tools.” From 2004 to 2005, he said, the county’s Medicaid transportation bill decreased from $10 million to $9 million. “We can’t prove it, but we obviously attribute [the decrease] to the tools,” Clement said.
Acquario said that BI tools are helping county officials throughout the state prove what they have long suspected — that fraud and misuse are contributing to the substantial growth of Medicaid claims. “Anecdotes are no longer going to be the norm,” he said. “Now, through statistical-driven reporting . . . we’re able to back up what we had suspected in ways we were not able to do in years past.”
Because New York is the country’s largest?? provider of Medicaid services — $44 billion worth in 2006 — it is important for the state to control its costs, Acquario said. He also noted that the state must be prepared for any federal government move to increase its share of Medicaid costs. “The stakes are high for the state of New York,” he said.
Wayne Eckerson, director of research at The Data Warehousing Institute, said that fraud detection is one of the biggest uses of data mining and predictive analytics tools.
