In May 2009, the Department of Health and Human Services (HHS) and Department of Justice (DOJ) created the Health Care Fraud Prevention and Enforcement Action Team (HEAT). The HEAT initiative is a multi-agency team of federal, state, and local investigators that use data analysis techniques to fight health care fraud, such as data mining, predictive analytics and trend evaluation.  For example, agents can review Medicare billing data from across the country, identify patterns of unusual billing conduct and send investigators to hotspots to investigate providers.

Providers can be targeted when they are outside the norm or deemed “outliers.”  This could be because of productivity higher than that of their peers, or because they treat a higher percentage of seriously ill patients causing the physician to bill higher level codes.

If a provider’s claims utilization and billing practices are outside of the norm, a provider can be subjected to an administrative audit (e.g. RAC, ZPIC), and/or potentially civil and/or criminal investigations (e.g. False Claims Act liability, Stark Law violations, Anti-Kickback violations).  Providers that are targeted through data analysis generally face extrapolated damages, which can easily run in the millions of dollars.  Since January 2009, the DOJ has recovered a total of more than $30 billion through False Claims Act cases.

Since data-driven investigations have proven very lucrative to government agencies, providers can expect continued scrutiny in the future.  We recommend the following proactive steps to reduce your exposure:

  • Hire a compliance officer.
  • Develop a compliance plan. If you have a compliance plan you should have it reviewed to make sure it is up-to-date and your company is following it.
  • Develop written policies and procedures. If you have policies and procedures you should have them reviewed to make sure that they are up-to-date and your company is following them.
  • Implement and document employee compliance training.
  • Conduct quarterly internal and annual external chart audits to determine whether the documentation in the chart supports the services provided and billed.
  • Use the results of such audits to develop corrective action plans to correct any problems.
  • Use publically available comparative analytics to compare your utilization to that of your peers. Example: Medicare Provider Utilization and Payment Data is available at
  • Timely refund identified overpayments (within 60 days).

For more information regarding this Client Alert, if you need assistance with developing/updating a compliance plan, or if you are the subject of an administrative audit or government investigation, contact Elizabeth Shaw at (904) 567-1175;