Report to Congress Fraud Prevention System First Implementation Year 12/14/12

As required by the Small Business Jobs Act of 2010 (Act) the Centers for Medicare & Medicaid Services (CMS) developed the Fraud Prevention System (FPS) to implement predictive analytics technologies to identify and prevent the payment of improper claims in the Medicare fee-forservice program. In the first year of the FPS, CMS implemented predictive analytic technology on a nationwide basis in less time than was statutorily required. In fact, the Office of the Inspector General (OIG) finds that the complex analytic models that CMS and its contractors have developed through the FPS produced “valuable data that *CMS contractors+ have used in ongoing investigations and to initiate investigations that have identified potential recoveries and costs that could be avoided.”1 The FPS generated leads for 536 new fraud investigations, provided new information for 511 pre-existing investigations, and triggered thousands of provider and beneficiary interviews to verify legitimate items and services were provided to beneficiaries. This is the first time predictive analytic technology has been used by the government on such a large scale for the purpose of identifying health care fraud, waste, and abuse, and it is the first time CMS has calculated actual and projected savings for a specific tool such as the FPS. CMS believes that we have developed the appropriate measures needed to estimate savings with respect to both improper payments recovered and improper payments avoided through the FPS. Read More