Blue Cross Blue Shield of Michigan Anti-Fraud Efforts Recoup and Save More Than $277 Million Since Inception

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May 26, 2010, 02:00 ET

DETROIT, May 26 /PRNewswire/ -- Blue Cross Blue Shield of Michigan's health care fraud investigation unit, the oldest and most successful health plan operation of its kind in the U.S., saved or recovered nearly $277 million since it first began operation nearly 30 years ago, including $15 million in savings in 2009.

That amount includes actual recovery of fraudulent payments, court-ordered restitution and a conservative estimate of the amount of money that would have been paid out if the anti-fraud unit had not forced an end to illegal activities.

"Our anti-fraud activities help ensure that critical health care dollars are being spent appropriately," said Daniel J. Loepp, BCBSM president and CEO.

Today at a media briefing in Washington, D.C., Greg Anderson, BCBSM vice president of Corporate and Financial Investigations, joined the Blue Cross and Blue Shield Association in announcing Blue Cross plans across the country collectively had prevented more than a half-billion health care dollars from being wasted on fraud in 2009. Anderson is a member of BCBSA's National Anti-Fraud Advisory Board and spoke about multi-state and multi-agency efforts to combat fraud.

"Coordination with state authorities and local law enforcement agencies is a key focus of anti-fraud efforts," said Anderson. "These efforts yield significant results and help defeat the sophisticated efforts of many fraud schemes. In addition, an educated public is a huge boost to investigations. We urge anybody with information concerning potential health care fraud to call our hot line number."

During 2009 the BCBSM anti-fraud unit acted on 2,300 tips involving suspected fraud. Its investigations led to 149 arrests and 94 convictions, and resulted in nearly $15 million saved or recovered in 2009.

He gave two examples of Michigan fraud cases:

Working with the Michigan State Police Mid-Michigan Area Group Narcotics Enforcement Team (MAGNET), BCBSM assisted in an investigation that led to charges against five mid-Michigan physicians. The physicians were charged with distribution of controlled substances such as Vicodin®, methadone and others, health care fraud and falsifying health care claims. Undercover officers obtained the drugs from the physicians who then billed BCBSM for the drugs. All five physicians pled guilty.

BCBSM assisted in the investigation of a large group of individuals passing fraudulent prescriptions for Oxycontin® in southeast and lower central Michigan. Subsequent arrests and convictions included individuals printing the prescriptions, supplying patient information from a doctor's office, driving drug users to pharmacies and submitting the subscriptions under insurance coverage. Legitimate patients were unaware that their insurance information was being used to obtain controlled substances. Much of the Oxycontin was smuggled into other states.

Health care fraud constitutes nearly 3 percent of all health care spending, according to the National Health Care Anti-fraud Association.

Telephone calls to BCBSM's toll-free, anti-fraud hot line are the starting point for most investigations. A routine mailing of explanation of benefits statements to Blues' members prompts approximately 70 percent of all hot line calls. The form lists services paid by BCBSM and encourages members to report any irregularities to the hot line. BCBSM also has an online method of reporting fraud through its website at bcbsm.com.

Anderson added that health care providers, the medical community and law enforcement agencies have been very supportive of anti-fraud efforts.

The anti-fraud unit recently earned a BlueWorks award as Top Special Investigations Unit among Blue Cross plans across the country in 2009. Among its achievements was the development of a training session for anti-fraud investigators across the U.S. that led to the hosting of its 1st Advanced Investigative Training Academy.

The unit is a unique combination of skills. The majority of its members have law enforcement backgrounds in surveillance, undercover work, credit card fraud and narcotics. Others come from inside the company with experience in auditing, security and nursing.

BCBSM played a supporting role in the passage of landmark anti-fraud legislation in Michigan, including the Health Care False Claims Act of 1984, which made any attempt to defraud a medical insurance carrier a felony and established maximum penalties of 10 years in prison and a $50,000 fine for violators.

Anyone with information about suspected health care fraud in Michigan should telephone the BCBSM toll-free, anti-fraud hotline at 800-482-3787, between 8:30 a.m. and 4 p.m. Monday through Friday.

Blue Cross Blue Shield of Michigan is a nonprofit corporation and independent licensee of the Blue Cross and Blue Shield Association. For more company information, visit bcbsm.com.

SOURCE Blue Cross Blue Shield of Michigan