Health Agencies to Debut Predictive-modeling Tech Tool to Stem Improper Payments

CMS Administrator Dr. Donald Berwick and HHS Secretary Kathleen Sebelius; Photo:,

The Department of Health and Human Services is set to roll out a new system next month aimed at rooting out waste, fraud and abuse at health agencies, using a new data-analytics approach known as predictive modeling.

Predictive-modeling relies on risk-scoring tools to analyze claims as they come in, zeroing in on suspicious activity much the same way banks already do.

Currently, the Centers for Medicare and Medicaid Services follows an inefficient “pay-and-chase” model, where claims are submitted and payments doled out before the agency determines if they are fraudulent or unnecessary. The new initiative, which CMS will launch July 1, focuses on preventing fraud and abuse before payments are made.

CMS Administrator Dr. Donald Berwick said the health agency’s new approach “is bad news for criminals looking to take advantage of our seniors and defraud Medicare. This new technology will help us better identify and prevent fraud and abuse before it happens and helps to ensure the solvency of the Medicare Trust Fund.”

CMS’ new tech-savvy method of stemming improper payments relies on technology from contracting giant Northrop Grumman, which partnered with National Government Service and Verizon’s Federal Network Systems to develop the predictive-modeling program.

In a speech last week, HHS Secretary Kathleen Sebelius said the new approach would allow CMS officials an unprecedented view into how Medicare dollars are spent. Agency officials would be able “to see billing patterns in real time and the technology to analyze those patterns,” she said, according to Federal Times.

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