Fighting Fraud, Waste, and Abuse in Healthcare
Identifying Billing Discrepancies to Deliver Higher-Quality Care
A Billion-Dollar Drain on the Healthcare Industry
Fraud, Waste, and Abuse: Driving Up Costs and Undermining Care
Each year, the healthcare industry loses an estimated tens of billions of dollars to fraud, waste, and abuse (FWA) in insurance claims.
As shocking as that number is, the financial loss is only part of the story. Behind every FWA case are real humans—patients, payers, plan administrators, and providers—who are exposed to higher premiums and out-of-pocket expenses, unnecessary or unsafe medical procedures, and compromised personal information used in falsified claims.
The result: Increasing distrust in a system already facing a crisis of confidence.
As part of our mission to reduce costs, improve quality, and elevate the healthcare experience, Vālenz Health® stands committed to reducing FWA for stakeholders.
Learn how we’re making it happen with data-driven insights, proactive risk identification, and other industry-leading strategies.
The Hidden Threat Driving Up Healthcare Costs
What is Fraud, Waste, and Abuse in Healthcare?
Fraud, waste, and abuse (also known as FWA) is an all-encompassing term for improper payments and practices in healthcare, often designed to maximize financial profit for the instigating party.
Typically, these cases fall into three different categories, which can and do overlap:
- Fraud: Intentional dishonesty or misrepresentation by a party, such as billing for services not provided, falsifying records, or receiving kickbacks for patient referrals
- Waste: Overuse or misuse of resources that results in unnecessary costs, often due to inefficiencies within the system
- Abuse: Practices that do not align with accepted medical or business practices, such as improper billing or providing services that are not medically necessary
It's important to note that improper practices cannot be classified as fraud unless intent is clear and evident, a process overseen by the Office of Inspector General.
Fraud, waste, and abuse can happen on all levels. While most people are familiar with cases where healthcare providers overcharge or recommend unnecessary care, insurers and health plan sponsors, as well as patients themselves, can be instigators (even unknowingly) of FWA—for example, by charging higher premiums than necessary or repeatedly seeking out unnecessary care.
The Impact of FWA in Healthcare
Fraud, waste, and abuse are committed every day in the United States.
Some estimates place the financial loss at 3% of total health care expenditures, while others estimate as high as 10% of annual health outlay is affected by FWA, leading to:
Minimizing Risk with a Proactive Approach
How to Prevent Fraud, Waste, and Abuse
Due to its prevalence in the U.S., identifying healthcare fraud, waste, and abuse isn't as simple as spotting a single mistake on a bill. It requires vigilance, expertise, and a strategic approach from all stakeholders in the healthcare journey: patient, payer, provider, and plan.
One of the simplest and most effective ways to identify potential FWA is by requesting itemized healthcare bills.
Itemized bills clearly state what service you’re paying for and how much you’re paying for it. The more billing data available, the easier it is to spot red flags and other inconsistencies.
In some cases, an itemized bill is all that’s needed to identify and resolve those errors; as one study revealed, 73% of patients who contacted a provider due to a perceived mistake received a correction.
Medical identity theft is an escalating crime that frequently results in erroneous, incorrect information being added to a person's medical record.
It can be prevented with strict handling of all personal healthcare information, including:
- Medical ID cards
- Policy numbers
- HIPAA-regulated data
Because of its complexity, FWA is best identified by experts in medical billing review. These professionals have the necessary training to find inconsistencies, excessive charges, or unusual billing practices that might signal fraud, waste, or abuse.
For a more comprehensive approach, we recommend implementing a suite of comprehensive payment integrity solutions designed specifically for FWA, such as those offered by Valenz. These solutions proactively detect billing inconsistencies using data science, expert oversight, and advanced analytics — preventing wasted, unnecessary spend from occurring in the first place.
This combination of data-driven tools and expert manual review are essential for detecting FWA trends, minimizing monetary risk, and protecting the bottom line of every stakeholder involved.
Stopping Waste Before It Starts
Contain Costs with Payment Integrity Solutions from Vālenz Health®
Assure the validity, integrity, and accuracy of claims—and protect yourself from fraud, waste, and abuse—with industry-leading payment integrity solutions from Valenz.
We leverage a team of accredited experts and analytics-informed automation tools to help reduce overpayments, eliminate billing errors, and drive more value for our clients, all while easing the administrative burden on your team.
Our Clinical Bill Review solution stops FWA before it occurs with detailed, line-item review by trained experts and data analysis tools, validating that care is:
- Medically necessary
- Provided by credentialed professionals
- Accurately aligned with contracted requirements
The result: A reduction in claim leakage and FWA occurrences—leading to a 10%–30% average savings from contracted network discounts.
Explore our other Payment Integrity Solutions today:
DRIVING SIGNIFICANT SAVINGS FOR OUR PARTNERS
Real Client Results
Delivering Smarter, Better, Faster Healthcare
Optimize Your Healthcare Spend with Vālenz Health® Today
As the platform to simplify healthcare, Valenz is your solution for optimizing the utilization of high-value healthcare—reducing costs, improving care outcomes, and elevating the healthcare experience for all.
With our payment integrity solutions, we stand ready to help you improve your financial performance and minimize skyrocketing healthcare costs. Drive down your high-dollar claim costs and billed charges with appropriate, defensible payments secured by provider agreements.
Connect with a Valenz team member today to explore the difference our solutions can make for you.
Ready to Simplify Self-Insurance?
Your Journey Starts Here
Connect with a Valenz team member to explore the difference our solutions can make for you.