Predictive Modeling Technology Helps Cut Down on Medicare Fraud

The Centers for Medicare & Medicaid Services (CMS) is cracking down on Medicare Fraud through its July 1 implementation of innovative predictive modeling technology. CMS says the technology is similar to that used by credit card companies and will help to identify potentially fraudulent Medicare claims on a nationwide basis, and stop them before they’re paid.

“Today’s announcement is bad news for criminals looking to take advantage of our seniors and defraud Medicare,” says CMS Administrator Donald Berwick, M.D. “This new technology will help us better identify and prevent fraud and abuse before it happens and helps to ensure the solvency of the Medicare Trust Fund.”

This preventative technology will use algorithms and an analytical process on original Medicare claims to identify potential problems and assign “risk scores,” and will replace the previous system that had more of a recovery-based focus, says CMS. This will be the first time the Center will have access to real-time data that will enable them to spot suspect claims through “risk scores” or alerts, and take timely preventative action against paying out those fraudulent claims.


The contract for developing the system was procured by Northrop Grumman, a global provider of advanced information solutions, says CMS; Grumman has partnered with National Government Services (NGS) and Federal Network Systems (FNS) to access claims data information to shed light on health care fraud characteristics, which will help in creating predictive modeling technology. CMS says it has used a variety of resources to develop the fraud prevention program, and that the urgency of the situation has led to the contract being implemented nationally and ahead of schedule.

Written by Alyssa Gerace