Georgia Medicaid To Save Millions By Using Equifax Auditing Tool

Georgia Leads States in Use of Commercial Software System to Audit Claims

ATLANTA, September 25, 1996 -- The state of Georgia's Medicaid program has selected a sophisticated computer technology from Equifax to help screen provider claims before final payment. The move is expected to save millions of dollars in taxpayer money each year without affecting quality of care.

Although a common practice by commercial insurers before paying medical claims, Georgia may be the first state to use a commercially available auditing software system in the public sector by auditing claims submitted to its Medicaid program.

"Georgia is doing everything possible to use taxpayer money wisely and improve the way the Medicaid program is implemented," said Marjorie Smith, Commissioner of the Georgia Department of Medical Assistance. "This new review system will provide significant savings of Medicaid funds that otherwise may have been paid unknowingly for claims that didn't adhere to our payment policies."

Auto-Audit(R) is a sophisticated computer audit system that allows users to identify and correct improper physician billing before the claim is paid. Georgia Medicaid can turn on or off some 40 different audit areas to customize the screening process to its payment policies. The cross-checks not only identify appropriate billing codes for procedures, but catch sudden deviations and flag other areas of possible errors such as laboratory services and other healthcare provider services. The system can audit more than 20 million billing code combinations. The alternative is a manual review of claims that may not consistently identify billing errors and is much more costly to administer.

"Based on the number of cross-checks used in the system, Auto-Audit has saved other organizations in the range of 5 to 10 percent. Clearly the potential exists for significant savings for Georgia Medicaid, which last year paid more than $481 million for physician, laboratory and other practitioner services representing approximately 15 percent of all Medicaid expenditures," said Dan Kohl, Senior Vice President and Group Executive of Equifax Health Information Services. "This is a proven, fair and consiste nt way to make sure only appropriate claims are paid with the flexibility to adjust to whatever payment policies the user wants to implement."

More than 22,000 providers submitted claims to Georgia for Medicaid reimbursement in 1995. Auto-Audit will now be integrated into the claims processing system as a final check prior to payment.

Last year, the federal government's General Accounting Office used Auto-Audit as part of a test to review Medicare claims by doctors. It documented $350 million in savings by using only eight of the available 40 cross-checks. In Congressional testimony, federal savings of up to $1.5 billion annually were estimated if all Auto-Audit cross-checks were applied to Medicare physician payments.