The Canadian StoryThe Canadian Health Care

Anti-fraud Association

Joel Alleyne, Executive DirectorCanadian Institute of Actuaries

Annual MeetingOttawa, ON

June 30, 2006

The Health System in Canada

• Approximately $130 Billion system

• Funded both publicly (70%) and privately (30%)

• Canada Health Act

• Provincial health care plans

The Health System in Canada

• Private insurers– Three largest account for over 60% of

the business– Active mix of

• for-profit,

• not-for-profit, and,

• third party administrators

/benefit managers

The Health System in Canada

• The debate continues– Federal involvement– Private health care– Waiting lists– Staffing shortages

Canadian Health Care Anti-Fraud Association

• Founded (formally) in 2000

• Strategic Partnership of Canadian

private and public health care

insurance payers, and Law enforcement

• Membership open to regulators and

provider associations

Canadian Health Care Anti-Fraud Association

Vision

To improve the Canadian health care environment by eliminating health care fraud.

Canadian Health Care Anti-Fraud Association

Mission

Our mission is to combat health care fraud and assist in restoring the integrity of the Canadian health care system.

Problems and Opportunities

• On several fronts– Providers– Plan sponsors– General public / claimants

• Awareness of the problem

• Importance of the problem

• Senior level commitment and support

Accomplishments Raising Awareness

Conferences / Regional seminars Sub - committees

Advocacy e.g. Privacy, Legislative amendment e.g.

Regulated Health Professions Act Communication

web-site, media, sharing information/expertise Liaisons e.g.

Law Enforcement, Regulators, Provider EHFCN Associations, US based carriers, NHCAA, FBI, NW4C

What is Health Care Fraud?

Our working definition:

“An intentional deception or misrepresentation that the individual or entity makes knowing that the misrepresentation could result in some unauthorized benefit to the individual, or the entity or to some other party”.

(NHCAA Guidelines to Health Care Fraud)

“Health care fraud remains uncontrolled, and mostly invisible. … … this problem represents one of the most massive and persistent fiscal control failures in their history.”

“For those who profit from it, health care fraud is not seen as a problem,but as an enormously lucrative enterprise, worth defending vigorously.”

Malcolm K. Sparrow

Professor, Harvard University - Kennedy School of Government

“License to Steal, How Fraud Bleeds America’s Health Care System”

Health Care Fraud Schemes

1. Billing for services/supplies not performed/provided

2. Intentionally making misrepresentations to obtain payment for services/supplies

3. The deliberate performance of medically unnecessary services for the purpose of financial gain

Who Commits Health Care Fraud?

1. PROVIDERS2. SUPPLIERS 3. PATIENTS 4. PLAN SPONSORS

- may act alone or with other participants

- may involve complex schemes or conspiracies, including

organized crime

The Appeal of Health Care Fraud

Diversity -many private and public payers - lots of $$$$$

Multiple victimization common Assumption of honesty - “good

faith” system System geared to pay claims

rapidly, efficiently Safe, “push of the button”

crime “Victimless crime” Detection unlikely

Victims and Impacts• Financial Victims - e.g. Insurers, Employers,

Public at Large

• Higher taxes / premiums / prices

• Less money available for the deserving

• Reduced coverage/ insured services

• Potential of Physical Harm

• False medical/billing records may affect future employability and/or insurability

Fighting Health Care Fraud cont’d

Detection Provider profiling using data mining tools Identify high risk behavior using fraud “red

flags” and benchmarks in data On-site provider audits Pre-payment/post payment audits Audit / verification / EOB letters Tips line Monitor known problem providers closely

Fighting Health Care Fraud

Prevention• Monitor trends, keep current• Educate/train staff, ins. plan sponsors,

patients• Employ skilled Practitioner Consultants

– expertise; best practice information

• Advise providers of fraud and abuse policy, and business expectations

• Strategic partnering / networking

Fighting Health Care Fraud cont’dInvestigation Special Investigation Units Referral to Police Services Complaints to Regulatory Bodies Decline fraudulent claims Recover unauthorized payments Restitution orders / Victim Impact

Statements / Crown assistance Recommendations for process controls

Working With Law Enforcement?

• Effective communication – e.g. Advisory notices “Health Care Fraud

Alert”• Assistance in Health Care Fraud training

– e.g. conference / seminars• Analytical support

– Utilization of Experts– Medical necessity review– IMR & opinions– General coordination between Law – Enforcement & the Insurance Industry

• Joint Investigations

Some Case Studies

• CBC TV Investigative report - dental• A woman from Brampton charged with 234 counts

of double doctoring and fraud for prescription narcotics

• A pharmacist charged with obtaining prescriptions for high priced drugs and paying the patient a percentage of the total prescription – not dispensing the meds however billing ODB for the prescription.

• A US citizen charged who was receiving insured medical services for which he was not entitled

Some Case Studies

• Foot care practitioners charged with submitting fraudulent claims to OHIP

• A Pharmacy case – fake Norvasc medication being dispensed to clients and the coroner investigating if this contributed to the deaths of multiple patients

• A Canadian pair who were charged over their fake Cancer clinic – this affected over 800 patients in Mexico totaling 12 million dollars

The Hospital Issue

• Canada Health Act

• Billing for semi-private coverage when no ward rooms available

• Patients are being implicated in the fight over funding

Canadian Health CareAnti-Fraud

Association

2006 Annual Conference

Halifax, NS, CanadaOctober 12 – 13, 2006

Contacts

• Jeff Alcock, Chair

• Joel Alleyne, Executive Director Canadian Health Care

Anti-Fraud Association (CHCAA)

http://www.chcaa.org/

phone 416-593-2633

e-mail info@chcaa.org