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 extreme instances of fraud and abuse are rare, but when they do occur, they have an impact and hurt everyone working to improve healthcare access and safety. Consider the situation of the oncologist who gives chemotherapy prescriptions to patients who have not been given a cancer diagnosis. or the cardiologist who performs unnecessary stent operations. For healthcare payers, artificial intelligence (AI) technology has uncovered these actual fraud incidents. Even while Covid care upcoding and simple medical coding mistakes are significantly more frequent, the Department of Justice (DOJ) only recovered more over $5 billion from civil fraud and false claims lawsuits in 2021, a mere fraction of the estimated $380 billion wasted annually. This is an astounding amount that is only increasing.
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 resulting 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 accountable for waste, fraud, abuse, and mistakes is a good deed. Healthcare executives that band together to explore the power of AI, ML, and automation are directly assisting in breaking down obstacles that have held us back for far too long as we navigate this post-pandemic period. Together, if we embrace innovation, we can improve healthcare so that everyone can receive better, more affordable care.