Ancillary Claims Detection investigation and prevention of claims

Ancillary Claims Detection, investigation and prevention of claims abuse and fraud

Session Outline § Referral Channels ðImportant Points § Investigative Methodologies ðPros and cons § Potential actions ðPros and cons

Referral Channels

Important Points • Maximise the use of less labour intensive channels • Have clear and heavily promoted referral channels • Keep staff updated on trends, offer tips on things to watch and provide them with an outcome

INVESTIGATIVE METHODOLOGIES Advantages versus disadvantages

Investigative Methodologies 1. Request treatment records (mail) Pros • Great preliminary check • Provider’s on notice • Lower level of resources required Cons • Open to altered or forged records

Investigative Methodologies 2. Member confirmation of services (mail) Pros Cons • Great preliminary check • Risk of member collusion • Will identify those members who weren’t aware (POSB) • Member dismisses request- too much effort • Lower level of resources required • Can reveal factors not yet identified • Member fears repercussions

Investigative Methodologies 3. Statutory declarations (retail network) Pros • Can be collected by branch staff at P. O. C • Doesn’t allow time for cohesive stories to be created • Good for inappropriate use of provider numbers Cons • Staff fail to record accurate/relevant information • Member declines offer to complete the statutory declaration • Most branches don’t have JP’s- Not admissible evidence

Investigative Methodologies 4. Formal statements (telephone/ in person) Pros Cons • Admissible evidence ** • Member attends court • High level of detail • Can be time consuming ** Conditions Apply-

Investigative Methodologies 5. Recorded Interviews Pros • Admissible evidence ** • High level of detail • He said she said format. No “I didn’t say that” – Transcripts ** Conditions Apply- Cons • Everything you say is also recorded. – Need to ensure that your questions do not lead the witness • Scary concept for some witnesses- Seems more serious than a statement

Investigative Methodologies 6. Data mining & statistical analysis Pros • Great preliminary check • Indicates parameters for investigation • Benchmarking Cons • Be careful what you ask for. • May not always provide actual proof • Time consuming to run reports

Investigative Methodologies 7. Claim reviews before payment Pros • Allows 100% control • Can request further information first • Easier to deny the payment then to recover Cons • Time and resource consuming • PHIO complaints • Can lose claims Use warnings on providers and members of interest for retail staff to call you when a cash claim is being presented. This will allow you to make a decision before the claim is referred in. Potentially reducing numbers of referrals

Investigative Methodologies 8. Phantom/mystery shopping Pros • Increased chance of success- Caught ‘red handed’ Cons • Can be costly if outsourced • Several buys proves a pattern of behaviour- • If using internal staff ensure safe working practices and training • Undeniable evidence • Medicare cards- optical • Known customers only This is becoming the way of the future with optical and some therapies

Investigative Methodologies 9. Subject matter experts- consultants Pros • Harder for provider to argue with a colleague • Has the latest information of best practices Cons • Limited to the information available in records – Can be altered • Knows what the tough questions to ask • Hard to find good ones that are prepared to make the tough calls • Great for reviewing treatment records • Juggling their time constraints

Investigative Methodologies 10. Formal examinations- e. g. dental Pros Cons • Hard to argue with the proof when you have it • Hard to prove some services weren’t provided • Great evidence • Hard to find a dentist who will make these calls • Hard to obtain member cooperation – Especially collusion Talk with you consultant about what services can be easily proven as not performed and vise versa.

Investigative Methodologies 11. Onsite Reviews Pros Cons • Harder for the provider to create or change records • 10 working day notification period • Can ask the questions then and there • Some providers will stonewall • Legal rights to go ‘onsite’ • (Dental) Review x-rays and photo’s at the same time Take a subject matter expert with you if possible.

Actions Advantages versus disadvantages

Actions 1. “We know what you are doing” letters Pros • May turn around those that are just doing it to keep customers • Documented evidence that they have been warned Cons • Won’t work of those who live to defraud people • Be careful you have the right person- was it the receptionist or another provider Get legal advice on a standardised template letter.

Actions 2. Suspending POSB Pros Cons • Can prevent claims going through without the members notice • Providers may just claim the same but through mail/branch/member • Easy way to obtain savings • Potential adverse customer satisfaction • Hits them where it hurts • Higher cost to process claims manually Look at taking the same actions for all persons at that practice

Actions 3. Provider benchmarking profiles Pros • Lets them think- we are watching you • May change their behaviour • Lets them know where they are versus their profession Cons • May disregard • May miss the intension and think it is just a ‘provider relations exercise’

Actions 4. Complaints to boards/associations/HCCC Pros • Potential deregistration – No benefits paid • Have more powers to inspect records and compel witnesses • Credibility with the member once finalised Cons • Limited resources • Potential for non-cooperation • Can take providers side • Very lengthy process (>1 -2 years) Try and obtain a contact within the association or body that you can channel complaints through.

Actions 5. Mount own prosecution Pros Cons • Full control • Costly • Easier to get into court then trying to get the DPP to mount a case • Time and resource consuming • Members called to court • Need strong legal team Use as a very last resort

Actions 6. Criminal action- police Pros Cons • Highest level of powers • Hard to get interest • More chance of witness cooperation • White collar crime view – Especially on small amounts – Most likely a good behaviour bond • Provider is charged – Easier to derecognise THIS WILL APPEAR ON THEIR CRIMINAL HISTORY.

Actions 7. Derecognition Pros • No more benefit payments – Reduced fraud risk • Sends a strong clear message Cons • Need a strong provider agreement • Members caught in the middle • How long? ? ?

Actions 8. Deeds of release- recovery of losses Pros Cons • Potentially high amounts of monies being returned • Potential for provider abuserepay and re-offend • Looks great in monthly reports • Be careful of extortion claims • May change the behaviour of borderline providers • Provider may not have the money to repay Take a subject matter expert with you if possible.

Actions 9. Counselling sessions Pros • Great chance to get provider explanation • Can include consultants • Can discuss appropriate outcomes Cons • Resource consuming • Can be costly • Chance of legal intervention • May end in a stalemate • Higher chance of behaviour modification Have a subject matter expert with you if possible.

Actions 10. Changes to business rules Pros • Good practice • Prevents future losses • Great for savings Cons • Can take a long time to action • Not always an easy process • Not always visible to members in publicity materials

Actions 11. Addition of alerts in rule based engines Pros • Higher chance of detection for future occurrences • Can be set to outright reject claims Cons • Time and resource consuming – Algorithms are hard to write (may require experts)

Actions 12. Changing benefit structures Pros • Allows benefits to be reduced on higher risk items • Visible to the member • Forces upfront thinking of benefit impacts Cons • Competitive advantage • Potential for meaningless benefit

Actions 13. No action Pros • Requires very little to no resources Cons • High level risk • Can send wrong message • Potential monetary loss to the fund It will not always be appropriate to take action (lack of information/evidence) but ensure you have a robust database to record this information as it may make a difference on a future investigation

My contact details Luke Givney Ph: (02) 9290 0284 Mobile: 0421 835 140 Please feel free to contact me if you would like further information on what we discussed today.