On February7 we will be discussing Computational Biology at Demo. No doubt we will hear about some potential breakthroughs in healthcare. One thing we know for sure is that new healthcare solutions are costly. How will people afford them? There are many issues associated with this and one of them is the fraud that occurs in today’s system. IBM has been working on this area for years and recently introduced their solution in Rockland County, New York.
The IBM Verify New York Medicaid claims management program has identified $13M in potentially improper Medicaid billing in just 10% of the cases in just one county in just one state. For a modest software and consulting fee, IBM used it’s powerful supercomputers to do a sophisticated statistical analysis of the billing from the top 10% of Medicaid reimbursed pharmacies and general practice doctors in the county during a 21-month period. Seems like a good target since New York’s Medicaid program is the largest in the US, with an annual cost of $44.5 billion — and rising fast.
Rockland County has more than 41,000 residents who use Medicaid and the county spends about $384 million a year on their care. Initial estimates are that as much as $13 million of the billing may be improper. If this turns out to be the case, the nationwide numbers are in the $billions for sure. The IBM system uses thousands of queries to look for anomalies such as suspiciously large numbers of bills for services on a single day, repetitive or duplicate billing or unusually expensive services. Forty-two percent of the ten percent in Rockland County appeared to have discrepancies.
The project doesn’t mean that providers are automatically guilty nor that the money can be quickly recovered but at least it shows the investigators where to look. They have always had the data but with help from IBM they now have the tools. There are obstacles. In New York, the counties are responsible for Medicare but they are not allowed to take action against fraud. Only the state can do that — but they haven’t. The IBM program enables the counties to provide very specific information to the state and press for action to reduce fraud.

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