If Americans thought healthcare was costly pre-pandemic, they—and their wallets—are about to be hit with a harsh reality: the cost to treat patients is expected to increase 6.5% this year, slightly higher than pre-pandemic, according to PwC’s Health Research Institute. What should be even more concerning is that a significant portion of what the United States spends on healthcare annually is lost to fraud, waste and abuse.
The most egregious cases of fraud and abuse aren’t common, but they make an impact – and sting all who are striving to make healthcare safer and more affordable. Take for example, the case of the oncologist who prescribes chemotherapy to patients without a cancer diagnosis. Or the cardiologist who conducts stent surgeries without need. These are real fraud cases that artificial intelligence (AI) technology uncovers for healthcare payers. While basic medical coding errors and Covid care upcoding are much more common, the grim reality that in 2021 alone, the Department of Justice (DOJ) recovered more than $5 billion from civil fraud and false claims cases, just a fraction of the estimated $380 billions lost every year. This is a staggering number that’s only getting bigger.
Five key areas of concern
Executive healthcare payer leaders recently gathered at a virtual roundtable to identify how the pandemic has shifted their views about medical costs, telehealth, virtual care, and technology investments related to fraud, waste, and abuse.
Here are the valuable takeaways from their discussion:
- Many factors influence rising healthcare costs, but top drivers are Covid testing and treatment and staff shortages.
- While overall utilization of healthcare is still down about 3-4%, utilization in lab work has increased dramatically by 15%. Surging lab work must be monitored by healthcare providers because it is driving an abundance of fraud.
- Covid care and treatment services are being upcoded, such as ordering respiratory panels or billing for full patient evaluations when only a Covid test was necessary. For example, in May 2021, the U.S. Department of Justice announced criminal charges against 14 defendants across the United States who exploited the Covid pandemic and resulted in more than $143 million in false billings.
- Staff shortages during Covid have also impacted access to care, which is creating a backlog that’s expected to last for at least two to three years.
- With a rise in the usage of telehealth, it’s vital to monitor evaluation and management (E&M) upcoding, where providers claim to provide a higher level of service than delivered or even claim to offer services that simply aren’t possible unless the patient was physically seen by the doctor.
How technology can be part of the solution
The adoption of AI, machine learning (ML), and automation to monitor fraud, waste, and abuse in healthcare is growing. Healthcare payers, agencies, and pharmacy benefits management organizations are realizing the value proposition of these technologies because they deliver transparency across the payment spectrum and create a unified view across claims, providers and patients for proactive integrity cost containment.
Here are some of the ways that healthcare payer executives are maximizing technology in their day-to-day operations:
- AI and ML are helping to tackle complex issues such as getting accurate billing, code auditing and finding complex areas that historically relied on manual discovery. This is a major win with the existing staffing shortages.
- AI’s potential for early detection and automation is another reason to invest—especially when it comes to fraud related to Covid care and treatment.
- AI and other technologies can create a more cohesive and holistic approach by enabling organizations to better communicate the value of payment integrity programs to providers and customers.
Catching those who are responsible for fraud, waste, abuse and errors is an act of social good. As we chart a new course in this post-pandemic era, healthcare leaders who join forces to explore the power of AI, ML and automation are directly helping to break through barriers that have held us back far too long. When we embrace innovation together we can transform healthcare to deliver more effective and affordable care for all.