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New York Fraud, Waste and Abuse, Recovery and Detection Project


... to reform and restructure the State's healthcare system and ... program integrity model by working with health care providers on compliance programs, ... – PowerPoint PPT presentation

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Title: New York Fraud, Waste and Abuse, Recovery and Detection Project

New York Fraud, Waste and Abuse, Recovery and
Detection Project
  • A Strategic Partnership to Increase Program

August 25, 2008
  • James G. Sheehan, Medicaid Inspector General,
    State of New York
  • William S. Fox, J.D., M.A., Vice President
  • Anne C. Chappuie, M.H.A., Vice President MAXIMUS
  • David M. Paul, C.P.A., C.F.E, Director MAXIMUS

Our Solution A Strategic Partnership
  • Embraces a shared vision to generate significant
    taxpayer savings and reduce inaccurate billing
  • Combines State program policy experts with
    leading industry specialists and cutting-edge
    technology to create customized algorithms and
    unearth significant overpayment recoveries
  • Aligns incentives to successfully attain our
    vision and create the model Medicaid Integrity

The New York State Medicaid Program
  • 46 billion program
  • New York State accounts for 7 of the U.S.
    population and accounts for nearly 14 of
    Medicaid funds nationwide
  • Highest per capita Medicaid expenditure in the
  • Per capita New York Medicaid spending is 130
    more than the national average
  • 10,000 per recipient

Federal-State Health Reform Partnership
(F-SHRP) An Overview
  • F-SHRP is a waiver program to reform and
    restructure the States healthcare system and to
    ultimately promote the efficient operation of
    that system.
  • Under F-SHARP, CMS invests a total of 1.5
    billion over 5 years in reform initiatives.
  • Federal funding is subject to conditions and
    milestones that must be met by the State by the
    end of the five year demonstration period.
  • If the State does not meet the targets in any of
    the years, it will be required to pay the Federal
    government an amount stipulated in the waiver for
    that particular year.

F-SHRP Conditions and Milestones
The Inception of OMIG
  • In 2004, The New York Times began addressing
    accounts of fraud through an analysis of data
    obtained under The Freedom of Information Law.
  • The series of articles showed instances of fraud,
    waste and abuse activities of both health care
    providers and enrollees.
  • In November 2006, the New York OMIG was created
    as a formal state agency to conduct and supervise
    activities to prevent, detect and investigate
    Medicaid fraud, waste and abuse

OMIG Program Integrity Vision A Three-pronged
  • Compliance
  • Audit and Review
  • Data Analysis

  • We want to make New York a program integrity
    model by working with health care providers on
    compliance programs, and working with our agency
    partners to assure that payment rules are clear,
    fair, and easy to identify.
  • We want to help make New York the State that
    puts patients first by focusing on information,
    quality and patient outcomes in our work as well
    as compliance with payment rules, and by working
    with our agency partners to assure that Medicaid
    providers meet minimum standards, or cease to be
    paid for Medicaid services to our patients.

Compliance Common Concerns
It may sound similar to existing guidance, but .
. .
  • Is an ineffective, non-compliant compliance
    program a program?
  • Should an effective compliance program have
    discovered matters identified by OMIG audit or
  • Mandated compliance programs-is this a health
    care version of principles-based regulation
    (vs. rules-based regulation) now being advocated
    in financial sector
  • Significant differences between traditional
    Sentencing Guidelines model and New York
    mandated model

Compliance Components
Eight Elements of the Program
  • Written policies and procedures
  • Employee designated as compliance program
    head-must report periodically directly to
    governing body
  • Training all staff on compliance
  • Communication lines to compliance officer
    (anonymous and confidential reporting)
  • Discipline for failure to report suspected
  • Routine identification of compliance risk areas,
    including internal audit and appropriate external
  • Response to compliance issues as they are raised
    correcting such problems promptly and thoroughly,
    and identifying and reporting compliance issues
    to DOH or the Office of Medicaid IG refunding
  • Non-retaliation

Compliance Professionally Recognized Standards
Payment Reform Measures (CMS, Private, NGO)
Public Reporting
Responsive To
State Licensing
Industry Initiatives (IHI)
Peer Review Organizations
Compliance Functions in Meeting Professional
  • Medical staff and leadership
  • Enterprise Risk Management
  • Peer review
  • Mandatory reporting
  • Utilization review/quality assurance
  • Patient safety
  • Quality improvement
  • Compliance
  • Counsel

Compliance Quality and Enforcement
The Outcomes to Look for
  • Senior level commitment on quality, discussion
    and best practices adoption
  • Addressing the bottom 10-get better or get out
  • Support for internal quality and reporting
  • Accurate information to patients, payers,
  • Better quality and patient outcomes
  • Program Integrity-getting what we are paying for

Audits and Recoveries
  • Conducts audits and reviews of Medicaid providers
    to ensure compliance with program requirements,
    including quality of care, and to determine the
    amount of any overpayments made
  • Numerous field audits for SFY 2008 09
  • Key areas of focus include
  • HMOs
  • Skilled Nursing Facilities
  • Hospitals
  • Ambulatory Surgery Services
  • Assisted Living Facilities
  • Diagnostic and Treatment Centers
  • Durable Medical Equipment
  • Home Health/Personal Care Services
  • MAXIMUS is an integral component of the SFY 2008
    09 workplan and is identifying significant new
    recovery opportunities

MAXIMUS Helping Government Serve the People
  • Premier government services provider for over 30
  • Over 5,500 employees in 280 offices nationwide
    and internationally
  • Healthy financial condition NYSE traded
    company with strong balance sheet
  • Serving over 4,000 U.S. government clients
  • All 50 states, the District of Columbia, Puerto
    Rico, the Virgin Islands, Canada, Australia, and
  • Every major U.S. county and city
  • Federal government agencies and departments
    including CMS

MAXIMUS Experience
  • MAXIMUS Offers a Wide Range of Health and Human
    Services Solutions
  • Health and social services program integrity /
    fraud, waste abuse
  • Medicaid, Medicare, Tri-Care, SCHIP, Child
    Welfare, Childcare
  • Medicaid managed care/SCHIP outreach, eligibility
    determination, education and enrollment
  • Independent medical review / appeals adjudication
  • Prior service authorization / quality monitoring
    / peer review
  • Payment Error Rate Measurement services
  • Third Party Liability
  • Health and Social Services Information Systems

MAXIMUS NYFWARD Accomplishments
New York Fraud, Waste, and Abuse Recovery and
Detection (NY FWARD)
Start Date 2007 Program Approximately 46B
annually Service Area Entire State of New York
  • In the State of New York, MAXIMUS is a strategic
    partner with the Office of Medicaid Inspector
    General (OMIG) to
  • Identify opportunities to enhance existing fraud,
    waste, and abuse (FWA) activities
  • Implement processes and procedures to mitigate
  • Assist in the identification of both provider and
    recipient Medicaid FWA
  • Support recovery of associated overpayments
  • To date, we have identified millions of dollars
    in questionable claims and are in the process of
    implementing recoveries

MAXIMUS NYFWARD Accomplishments continued
  • Evaluating current FWA activities, pre- and
    post-payment reviews, and technologies utilized
    through data mining and analysis
  • Identifying new initiatives to detect and prevent
    improper payments
  • Estimating possible savings, costs, and time
  • Implementing new improvements and initiatives
    approved by the State and assisting New York in
    changing current processes in order to improve
    recoveries and cost avoidance

MAXIMUS NYFWARD Accomplishments continued
  • MAXIMUS conducted a six month top-to-bottom
    analysis focusing on two crucial aspects of
    OMIG's Medicaid FWA efforts
  • Functionalities and operations of the OMIG and
    related Agencies
  • FWA vulnerabilities in New York Medicaid
  • MAXIMUS staff conducted interviews with over 125
    staff from the OMIG and related agencies to
    examine the functionality and operation of the
  • Conducted detailed research into national fraud
    trends and vulnerabilities in the Medicaid system
    and analyzed them in relation to current New York
    State Medicaid policies, procedures, and
  • Staff members have extensive healthcare FWA,
    Medicaid, technology, project management, and
    operational expertise
  • Certified Fraud Examiners, Medicaid policy
    experts, operational experts, technology experts,
    and a CPA, and former fraud prosecutor

MAXIMUS NYFWARD Accomplishments continued
  • Initiatives are identified by combining extensive
    healthcare FWA expertise with sophisticated data
    mining technology
  • Reports categorize providers and flags
    (indicators of claims that violate a system rule)
    based on claim details
  • Individual claims are examined at the provider
    and patient level
  • Claim details are reviewed in relation to current
    Medicaid policies, procedures, and regulations to
    verify the validity of the flags
  • Once providers are approved by the State, OMIG
    begins recovery of overpayments
  • Data mining tools detect unusual patterns of
    billing and/or questionable claims paid to
    providers, which are then summarized into flag
  • The MAXIMUS analyst team develops initiatives
    within flag categories including but not limited
  • Duplicate claims billed
  • Mutually exclusive procedure codes billed
  • Unbundled procedure codes
  • Same procedure code billed
  • Unusually high units of service billed
  • Transportation service billed without any
    related medical visits

MAXIMUS Accomplishments continued
  • Analyzed 3 years of New York State Medicaid
    claims data totaling 1.4 billion claim lines
  • Analyzed every claim utilizing our customized,
    comprehensive fraud filters, identifying and
    ranking fraud opportunities based on historical
  • Provider centric
  • Patient centric
  • Performed a comprehensive review and analysis of
    payment policies with OMIG to implement
    customized rules-based analysis

MAXIMUS Accomplishments continued
Conducting detailed analysis of rate codes and
developed fraud detection logic for rate-code
based provider billing
  • Unique payment practices create abundant
    opportunity for provider fraud
  • Special procedure codes and state-generated
    codes all create challenges to fraud prevention
    and discovery

MAXIMUS Accomplishments continued
The MAXIMUS team continues to analyze the data to
identify previously unknown fraud opportunities
  • New opportunities are hidden within the vastness
    of the data
  • The changing nature of fraud demands flexibility
    and creativity on the part of examiners
  • Requires use of the most sophisticated data
    mining tools available in conjunction with
    continual refinement and fine tuning

MAXIMUS Lessons Learned
Strategic alignment between MAXIMUS and the OMIG
is paramount to achieving project goals
  • Define respective project goals
  • Chart a common path to success encompassing
    respective goals
  • Engender a collaborative environment

Challenges Encountered
  • Data Integrity
  • Budgets and Resources
  • Creativity of Providers and Suppliers
  • Belief That This Cant Happen in Our System

MAXIMUS Program Integrity Solution
MAXIMUS End-to-End Program Integrity Solution
  • Through this collaborative approach to enhancing
    fraud, waste and abuse, recovery and detection
    efforts in the State of New York, both MAXIMUS
    and OMIG are strategically aligned to
    successfully attain our project goals and create
    a model Medicaid Integrity Program

The Future of Program Integrity
Front Loading Program Integrity
  • Prevention vs. Collection
  • Education and Training
  • Stakeholder Commitment
  • Real Compliance
  • Comprehensive Program Integrity Programs
  • Push Data Mining to the front
  • Integration of State, Federal and Provider Efforts

The Future of Program Integrity continued
  • Data analysis (by both providers and agency) will
    drive program integrity
  • Never events, highly improbable events, and
    series of events
  • Systems and controls at larger providers and
    MCOS-share prevention duties
  • Still significant role for clinically supported
    audits and investigations