1. Make sure that the insurance card carrier’s identity is confirmed. The first thing for medical professionals to do right out of the gate is always confirm that medical insurance card carrier’s identity. The majority of healthcare fraud is done when one insurance number is shared between a number of people. Dr. Johnson recognizes the difficulty in screening for false identities. “It’s complicated for hospitals and ERs because there’s a law that says you have to treat everyone in an emergency status,” he says. “[Through the ER], hospitals can be defrauded fairly often.
Dr. Johnson suggests that hospitals and medical centers put in place rigorous processes of making sure a legitimate photo ID matches the name and information on that medical insurance.
2. Match 1099 information against the bills that are issued. Healthcare payors send tax documents called 1099 forms each year to all providers that have received payment from them the previous tax year. The actual payments provided by payors should match the amount received by providers. If a provider is reporting payments that fall below the amount payors have recorded, it is possible someone has stolen that provider’s identifier number. The government recently published a list of national provider identifier numbers for hospitals across the country, which could create potential problems.
“It’s possible that someone or some entity could get control of any provider’s NPI number and submit false bills under that hospital or outpatient clinic, and there could be compensation going to somebody and the hospital is totally unaware of it,” he says.
3. Adhere to the “Red Flags” Rule. The Federal Trade Commission will soon begin enforcing the Red Flags Rule for healthcare providers, which requires businesses and organizations to develop an official plan that outlines the “red flags” of identity theft. This rule gives healthcare providers flexibility in outlining a program that will help stamp out healthcare fraud in such a way that is best suited for their environment, as long as it falls within the Rule’s parameters.
The FTC highlights some points of interest for hospitals and other medical centers to keep in mind as “red flags”: suspicious documents, suspicious personal identifying information, suspicious activities and notices from victims of identity theft, law enforcement authorities, insurers or others.
4. Be proactive. Most medical institutions, insurers and law enforcement realize instances of fraud only after those fraudulent payments have been made, and then their efforts are spent trying to identify the provider that made that claim. “Almost everything CMS and the government does is retrospective,” Dr. Johnson says. “With healthcare reform, there’s a new energy in identifying healthcare fraud prior to payment.” Some guidelines, such as the Red Flags Rule and practices to ensure correct identity, are some suggested ways to help healthcare providers avoid the headache of dealing with healthcare fraud after it has already happened.
