Regence uses technology and know-how to protect Medicare members from fraud
The past few years, scammers posing as providers have increasingly targeted the Medicare population by using patients’ Medicare ID numbers to file billions of dollars in false health care claims. As the cost of health care continues to climb, it's more critical than ever to protect Americans from these fraudulent practices.
Listen to the full podcast episode on the player above. Below are some highlights, which have been edited for length and clarity.
AB: Can you tell me more about the special investigations unit at Regence and its mission?
JW: It’s our job to investigate allegations of suspected health care fraud. And our mission is to support our company's reputation as a safe place for our customers to spend their health care dollars, and to be good stewards of protecting those dollars.
We investigate really any allegation of suspected health care fraud. It could be billing for services not rendered, any type of questions regarding how a provider has submitted a claim as far as the coding goes. But really, if a member suspects or alleges that services were not rendered or not rendered to the degree that they were billed, then that would be something that our unit would investigate.
AB: A lot of this is trying to make sure that customers entrust that we're going to be a safe place for them to spend their health care dollars, right?
JW: Absolutely. We do take our commitment seriously to our members and try to protect their premium dollars. Health care is expensive. I think everybody knows that. I think everyone has felt that over the last five, six years. It's complicated. It's hard to navigate, especially for our Medicare-aged members; if they don't have someone representing them or helping them, it can be really, really convoluted and hard to understand, and they have no idea that they're at risk. So we want them to know that when they call us and say, “I don't think I had these services,” that we're going to do everything in our power to either prove the services legitimate or illegitimate, and continue to protect them going forward.
AB: You mentioned our Medicare members; how has fraud targeting the older adult population increased in recent years?
JW: It started pre-COVID. There was a really large Medicare fraud scheme, with durable medical equipment, (whose crackdown by the Justice Department was dubbed Operation Brace Yourself), where “providers,” in air quotes, were submitting claims for leg braces and other types of orthotics for Medicare members who did not receive those services, or if they did, they weren't medically necessary.
It started there, and then COVID opened the door. Our Medicare population, I think just because it's so large, they were an easy target. There are so many claims coming in and out that these providers think no one will ever notice, but they grow into these huge million- and billion-dollar schemes. Durable medical equipment still being the heaviest hitter of what we're seeing.
These providers are not providing any kind of service. Whether they're getting member ID numbers from our Medicare members unsolicited by calling them and claiming to be from a provider that their doctor recommended, and our Medicare members maybe are sharing their information with these providers, or there's a network, where they're sharing and selling this Medicare member information. But what we're seeing is that specifically they’re targeting the Medicare population, submitting large batches of claims for these Medicare members, and then we receive those claims as crossovers from Medicare to their secondary plan.
AB: The term for these bad actors is “phantom providers,” correct?
JW: Yes, essentially, they're a business owner, using that term loosely, who file for a business license with their secretary of state. They usually don't even have a real location, a mailbox drop or some kind of empty office location or a home or a garage, and they just somehow came into possession of these member ID numbers. And they will submit these large batches of claims, high-dollar durable medical equipment, and then that business will cease to exist, and a new business will start up out of that same address or same owner.
AB: How has Regence addressed the issue of phantom providers to protect our Medicare members?
JW: We identified the issue of phantom providers pretty early on. The only issue was that when we were catching these, or we were getting tips from our members, it was after the fact. So these claims were already paying; they were already sitting in our claims adjudication system. And aside from voiding checks, there was really nothing we can do. And so early on in my career as a data analyst in our special investigations unit, I identified this gap where we needed to get to these claims as early as possible. We needed to put our fingers on them before payment was going out to these providers. And so we created a dashboard where we look at all incoming claims that fit this very specific scenario before they hit our claims adjudication system.
So when a provider submits a claim through our third-party portal, it sits in this holding space before it comes into our claims processing system. And so the tool that we created was to look at those claims in that holding place and separate them by specific outliers that maybe fit this scheme or other schemes, and review the claims there before they've hit our claims adjudication system, so that we can try to stop those claims before checks are created, before claim payment is made, before our members have to call us and notify us as these services weren't rendered.
AB: What have the results been so far with the new tool protecting our Medicare members from fraud?
JW: In the first two years, 2023 and 2024, we prevented about $13 million in fraudulent payments. And we were able to identify and block 55 phantom providers who were targeting our Medicare members.
AB: What can Medicare members do to protect themselves from this kind of fraud?
JW: They need to make sure that they're looking at their Explanation of Benefits. If they don't understand it, call our Customer Service line. Be familiar with their benefits, and if they have someone who can help them go through these things if they don't understand it; it's always great if they can have a representative or a family member to help them understand or check. If they don't have that, we're here always. Customer Service is great, and they reach out to us often.
And don't answer those unsolicited phone calls, and keep their Medicare member ID number, their Regence member ID numbers safe. Don't share those with anybody. If it's a true physician that they're working with, that physician should have that information or be able to access it. So, don't give that information to anybody over the phone if the person can't confirm their identity for you, or you have no idea who they are, or you aren't sure that they're working with your provider.
Not everyone has great intentions, and that's really unfortunate, but it's OK to just say, “No, I can't give you this information,” and then reach out to us or their provider or Customer Service, and try to confirm the identity of that caller if they can, and if they can't, then don't give them your information. No need to respond to them.
AB: Health care just gets more and more expensive. We at Regence are always trying to make health care more affordable for our members. And you look at these really cool fraud prevention results for this new tool, saving $13 million in the first two years. How do you feel about being able to help our Medicare members with rising costs?
JW: It's incredible. And to be able to say that I know for a fact that we’re doing everything in our power to prevent rising costs, it's great. I know there's more that we can do. We can do better, absolutely, because we can't stop or prevent everything, but we're going to try. We're going to do our best.
For Medicare members: Bad actors are calling Medicare members to try to steal their personal information. The scammers pretend to be from Medicare or a health care company and ask for personal Medicare or Social Security information. Regence will never call our Medicare members unsolicited and ask for our members’ Medicare card number or Social Security number.
Access more Regence tips and resources about how to protect yourself from Medicare fraud.
