Moving Away from “Pay and Chase”

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The Report to Congress Fraud Prevention System, Second Implementation Year, June 2014 notes that one of the mandates of HHS in fraud prevention is to

Evaluate the feasibility of expanding predictive analytics to Medicaid

“CMS is required to evaluate the cost-effectiveness and feasibility of expanding predictive analytics technology to Medicaid and the Children’s Health Insurance Program (CHIP) during the third implementation year of the FPS.” The report further notes that real recoveries are made when preventing fraud, not in the pay and chase mode– where the specious (and perhaps soon to be absent) provider is paid and then recovery is sought for the overpayment or mispayment. Since States hold the purse strings for Medicaid, it is thought that data scrubbing and analytics may not work the same way it has in recent years for the feds, who can question and suspend before payment.

No doubt data scrubbing works.  Since experience demonstrates that Medicaid and CHIP are also rife with fraud, this has to be pursued in the same way the feds do it. The real tension will be with State prompt pay responsibilities.

It is also worth noting that Texas may have to ask Court permission due to a previous settlements in Alberto N. v. Janek curtailing its (contractors’) notice to include what action it intends to take on the reduction, denial or termination of a requested service to those under 21 in the CHIP program.

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