Medicare’s Fraud Prevention System that uses predictive algorithms to analyze provider billing patterns caught nearly $211 million in improper Medicare payments during the past year.

That is almost double the rate of the first year using the system, according to the Centers for Medicare and Medicaid Services. In a report to Congress, CMS said it took action against 938 providers and suppliers after analyzing every Medicare fee-for-service claim.

“For example, the FPS identified an aberrant provider that had a pattern of inappropriate billing,” according to the report. “Investigators conducted an unannounced site visit, interviewed beneficiaries and reviewed medical records. It was discovered that the provider was using unlicensed and unqualified individuals to provide care. CMS revoked the provider from Medicare, preventing future payments and protecting quality of care.” That case uncovered $700,000 in improper billings. The FPS produced a $5 to $1 return on investment during the past year, compared with a $3 to $1 return in its first year of operation, according to CMS.

The FPS is not designed to flag long-standing honest and reliable providers who make mistakes or common errors, the agency told Congress. “Rather, the FPS is geared towards discovering egregiously improper patterns of billing, often amounting to fraud.”

CMS expects to enhance the analytics system to identify patterns of waste and abuse, evaluate the feasibility of expanding the technology to Medicaid, and disseminate lessons learned and best practices to stakeholders. The report to Congress is here.

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