The Small Business Jobs Act of 2010 (the Act) requires the Department of Health and Human Services (the Department) to use predictive modeling and other analytics technologies (fraud-detection models) to identify improper Medicare Fee-for-Service claims that providers submit and prevent the payment of such claims. To fulfill this requirement, the Department designated the Centers for Medicare & Medicaid Services (CMS) to develop and implement the Fraud Prevention System (FPS).
OIG certified the actual and projected savings with respect to improper payments prevented and recovered, and the return on investment related to the Department’s use of the FPS for each of its first 3 implementation years. However, when performing that work, OIG became aware that the Department might not have the capability to trace the savings from administrative actions back to the specific FPS model that generated the savings. Without this capability, the Department is not able to accurately evaluate an individual FPS model’s performance. Therefore, the Department may be limited in how it assesses the effectiveness of its predictive analytics technologies. OIG performed this audit to follow up on some of our concerns from our previous audits.Read the full report