Fraud, Waste and Abuse in the Health Care Industry

Health care fraud accounts for 3-10% of the trillions spent on health care in the U.S. In fact, fraud, waste and abuse costs the health care industry and consumers $350 billion a year, and that number is rising. Find out how fraud, waste and abuse affects you, and ways you can protect yourself.

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Show Transcript

SPEAKER 1: What if I told you that individuals you trust may be taking advantage of you? Each day fraud, waste, and abuse attempts terms are targeted at the health care industry. It could be happening to you right now.

Misrepresentations and false claims are rampant across the health care industry. And these activities impact all of us. Americans spend trillions of dollars on health care annually. And an estimated 3% to 10% of that is attributed to fraud, waste or abuse-- an estimate that costs the health care industry and its consumers $350 billion every year. These figures are on the rise.

Let's learn how you can prevent fraud, waste, and abuse. Here at Blue Cross and Blue Shield of Illinois, we receive thousands of medical claims each day. And we monitor these claims closely for red flags and alerts. In some cases, we find conflicting information and identify potential wrongful payments.

That is why our Special Investigations Department is always on the lookout for how to detect and prevent fraud, waste, and abuse-- protecting our customers, providers, and members, controlling costs for all. Here is an example of a SID investigation that stemmed from a greedy unethical provider who engaged in identity theft to generate fraudulent medical claims for financial gain.

This is Jenny. For the past couple of months she has been receiving bills for mental health services from her provider. This is surely a mistake, she thought. I haven't used these services. But the explanation of benefits letter, also known as the EOB, indicated these services were provided during her appointments. What is going on here?

That is when she called Blue Cross and Blue Shield of Illinois customer service and discovered that the provider billed her for mental health services not provided. Jenny was referred to the Fraud, Waste, and Abuse Hotline. The SID investigation revealed that the provider had been submitting false medical claims for non-rendered services.

As a result, the provider was paid over a million dollars. The investigation also revealed that the mental health provider was out of state on the dates of service listed on the suspect's claims. The provider had engaged in member identity theft to intentionally create false medical claims.

Based on our investigation and the data collected, the information was presented to federal law enforcement for prosecution. The provider was charged at the federal level and was convicted of conspiracy to commit health care fraud. He was found guilty and sentenced to six months in a federal prison and fined $100,000. They also ordered him to pay $1.4 million in restitution to Medicare and other health insurers who were also victim to the fraud scheme.

Our Special Investigation Department works alongside federal and state law enforcement partners, the National Healthcare Antifraud Association, and the government-led Healthcare Fraud Prevention Partnership to identify emerging fraud, waste, and abuse schemes. Our team includes former federal agents and prosecutors, medical directors, nurses, data scientists, professional coders, and claims processors.

This diverse team is constantly reviewing claims to identify outlier providers and fraudulent, wasteful, or abusive suspected billing schemes that are not acceptable medical practices. In some cases, SID found that medical professionals are even putting patients health at risk just to generate medical claims for financial gain.

So how can you protect yourself from falling victim to health care fraud and/or identity theft? Here is the breakdown. Review any Blue Cross and Blue Shield of Illinois correspondence, just like you would review your bank or credit card statements. Educate yourself by calling our customer service to help understand the claim information and the billing process.

If your questions are not resolved and you are concerned about potential fraud, waste, or abuse, call the Fraud, Waste, and Abuse Hotline, or submit a report online available 24/7. All reports are confidential and can be anonymous.

We are committed to protecting you and others from health care fraud. Ultimately, these deceptions impact the overall cost of health care, the quality of medical care given, and the trust we have in our health care system.