COVID-19 and Medicaid Fraud

August 17, 2021 by Lisa Sigler

COVID-19 and Medicaid Fraud

The coronavirus pandemic led to a dramatic decline in the services people were receiving through Medicaid. Not only were people staying home, but providers such as doctors, dentists, medical supply companies, and laboratories were also shutting their doors. In order to make sure people continued to have access to the care they needed despite these shutdowns, Medicaid had to make changes in the way they work. While these changes were necessary, each of them opened the door to a different kind of fraud. A recent Tyler podcast outlined these new challenges and introduced ways that program integrity units can fight back.

What changed?

To address the challenges of providing services during the height of the COVID-19 crisis, Medicaid agencies relaxed some existing policies — which created and encouraged new opportunities for fraud.

Relaxed enrollment. Some agencies relaxed enrollment requirements for providers, in order to make sure there were enough providers available to deliver services. Because agencies were trying to enroll providers as quickly as possible, in some cases the necessary checks were not being performed to ensure that providers who had been barred from Medicaid were not able to re-enroll. Providers who have previously engaged in fraudulent activity or who have associated with individuals who have been convicted of fraud are excluded from the Medicaid program.

Relaxed billing processes. Fraudulent providers were able to take advantage of the confusion surrounding new billing codes to bill for services not rendered. This category of fraud included billing for laboratory testing, drug screenings, and even “impossible days,” in which the provider bills for more hours than could possibly be worked in a given timeframe.

Relaxed telehealth guidelines. The need to provide services remotely led to a necessary rise in telehealth services. However, it is harder to monitor and verify what happened in a telehealth session, making it easier for providers to make fraudulent claims or to claim telehealth was provided for illogical services or services that cannot realistically be provided remotely.

What can program integrity units do?

As program integrity units combat these new types of fraud, it is important for them to have the right tools. The ability to look at all available data is critical for identifying fraud. So what should an agency look for when implementing solutions to support program integrity?

  • View the data from various silos together. State Medicaid program integrity units must have access to as much accurate data as possible. While it can be difficult to spot fraud at an individual claim level, data analytics can uncover patterns revealing fraudulent providers and their schemes.
  • Use technology to identify common fraudulent behavior. There are established, well-known behaviors fraudulent providers commonly commit. Implement solutions that can run a query against your data warehouse, where all the data from Medicaid services is stored. Then run reports to identify what's going on.
  • Look for evidence of new schemes. With the right solution, you can take just a few minutes to see if what you suspect is really happening. Analytic tools allow program integrity officers to be fast, responsive, and nimble.

These new types of fraud are likely to stay with us even when the coronavirus is fully under control. However, having the right tools for viewing, tracking, and analyzing both provider records and claims data can allow program integrity units to stay on top of things. As they identify and fight fraud, they can also suggest policy and procedural changes to ensure these new fraudulent behaviors are no longer occurring in the Medicaid program.

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