CMS Required to Implement Anti-Fraud Software with "Predictive Modeling" By Next Year

The Centers for Medicare and Medicaid Services is required to implement new billing technology with "predictive modeling" by next year that will better prevent fraud from occurring, according to a Miami Herald news report.

The anti-fraud provision is a component of the Small Business Lending Act that President Obama signed into law Monday, which means Medicare will have to end its 45-year tradition of paying claims without verifying them, according to the report.

Under the anti-fraud provision, the new billing software CMS must implement is required to have predictive modeling, a type of analytics that is already being used in the credit card industry to identify potential fraud. CMS is also required to start a competitive bidding process by January for contractors of predictive modeling software and to have the technology implemented in 10 states with the highest incidence of Medicare fraud by July, according to the report.

Medicare billing contractors would use the new technology to process claims for hospitalization and outpatient services, which make up the majority of the federal program's costs, according to the report.

The Department of Health & Human Services' Office of Inspector General will report the actual savings achieved through the new technology to Congress after one year of operation, according to the report.

Read the Miami Herald news report about CMS predictive modeling software for fraud.

Read other coverage about anti-fraud measures:

- Bipartisan Anti-Fraud Legislation Passes in House

- House Passes Herger, Stark Bill Barring Execs From Working With Medicare Even After Leaving

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