GOVERNANCE: Stronger Controls Would Help Identify Fraudulent Medical Claims Sooner and Limit Losses

December 10, 2019 |  Audit Reports

This report assesses the effectiveness of the company’s controls to mitigate the risk of fraud in its payments to non hospital facilities. We focused on claims the company paid to the top tenth percentile of non hospital facilities from 2014 through 2018.


Just as with our previous work on medical claims, we found that the company is exposed to potential fraud in its medical claim payments and has not obtained a capability to proactively analyze its medical claim payments for potential fraud. Notably, Amtrak is self insured and pays for each medical claim as they are incurred from its operating budget.
Among the medical claims of non-hospital facilities we reviewed, we identified 191 that exhibited billing patterns indicative of fraud. The company had not flagged the billing patterns of these facilities for further review. This has put at risk an estimated $57 million the company paid to these facilities between 2014 and 2018.


To address the findings in our report, we recommend the company do the following:
•    Review claims paid to the 191 potentially fraudulent facilities and seek recovery of whatever portion of the $57 million in claims it determines were improper.


•    Implement proactive fraud detection procedures sooner, so that the company can stop fraudulent payments earlier.


•    Implement fraud awareness initiatives to enable plan members to better recognize and report potential fraud.


•    Gather information on fraud schemes and emerging fraud trends and use it to monitor its medical claim payments.


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