SmartLight Analytics

ANALYTIC EXPERTISE - CLINICAL EXPERTISE

costs

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SmartLight Analytics grew out of a desire to take meaningful action on rising healthcare costs

In August 2016, SmartLight Analytics was founded out of a desire to help employers deal with the rising cost of healthcare and make an impact that would not only help big companies but thousands of their employees as well.

Employee healthcare costs are expected to top $15,000 per employee in 2020, according to research from the National Business Group on Health.

SmartLight Analytics is focused solely on reducing year-over-year medical spend for self-funded employers. Founder and CEO Asha George headed up the Payment Integrity departments inside various large insurance carriers for decades before forming SmartLight Analytics. SmartLight was created because she saw the need for more independent, pro-active intervention in reducing unnecessary healthcare spend. 

“The American healthcare system has become increasingly more elaborate and difficult to navigate over the past several decades. Within this environment of complexity and rising costs, over 95% of employers are now funding their own employees’ healthcare,” George explained, adding that industry experts estimate billions of dollars are leaking out of the system with no measurable improvement in patient health.

To significantly reduce this waste, SmartLight Analytics, LLC was formed by a group of industry insiders including George and her co-founder: Chief Medical Officer Dr. Franklin Baumman, a surgeon who spent 11 years as a medical director for UnitedHealthcare, the largest insurance carrier in the country.  

“We wanted to make a meaningful impact on the rising cost of healthcare,” George said.

With this end in mind, SmartLight uses statistical, clinical, and claims expertise to deliver the most complete cost reduction solution directly to the actual stakeholders – self-funded employers. Since processing claims is outside the core competency of most employers, patterns of error often go unnoticed and result in the unnecessary spend of health plan dollars. SmartLight delivers a low-touch, high-impact solution to self-funded employers.

Other organizations with the similar vision of reducing commercial healthcare costs, are primarily using member pricing transparency tools, allowing members access to pricing options for specific services. Whereas SmartLight is a comprehensive solution that works on identifying and resolving issues directly from the client’s plan funds, George explained. “SmartLight identifies wastes, coordinates with the employer’s claims administrator to prevent future waste and, most importantly, ensures that offsets and denials are credited back to the health plan.”

“I’m passionate about making a meaningful impact in this space,” George said. “Insurance carriers, in the role of third-party administrators, do their best to manage the waste in the system while processing claims, but we have, without exception, reduced spend by an additional 3-5% for our customers. We use statistical, clinical and data expertise developed over decades of experience to deliver the most effective cost-reduction solution available in the market, customized to your unique population.”

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Pass through billing schemes

“Healthleaders Media” recently reported on a case involving pass-through billing in Florida which highlights how such schemes can grow if undetected during regular claims reviews.

The case involved the owner of a substance abuse treatment facility who sent his patients’ urine samples to a lab that returned 40% of the insurance reimbursements to the owner. He then arranged with the managers of two rural hospitals in Florida to have the testing billed to private insurers at a higher reimbursement under the hospitals’ in-network contracts.

The scheme expanded to include rural hospitals in Georgia, and more drug rehab centers, resulting in laundering more than $57 million in illicit reimbursements.

Rural hospitals, often due to declining revenue, have been repeatedly identified in fraudulent and abusive billing schemes intended to increase revenue. Vigilance by those processing claim payments is required to prevent wasted dollars from being spent. SmartLight has identified multiple schemes involving suspect patterns of urine drug tests and pass-through billing.

Rural hospitals involved in pass-through billing to maximize reimbursements from claims administrators is a growing problem. SmartLight has identified over 7 hospitals in Texas and neighboring states involved in this abusive billing scheme in 2019. Analysis of claims data using inferential methods can quickly identify these suspect claims in an employer’s healthcare claims population.

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CASE STUDY: Uncovering potential abusive billing

June 2019
 

During monthly monitoring of a client’s claims, the SmartLight Analytics’ team identified potential abusive billing by a licensed in-network physician who owns a family practice in Texas. The issue was identified due to an abnormal billing pattern in comparison to provider peers.  The suspicious claim pattern included repeated payments for injections without any associated drug codes stretching over a 9-month billing period.

The provider also reported an inconsistent diagnosis of chronic kidney disease for a patient, with no follow up service related to this diagnosis seen anywhere in the patient’s medical history. Additionally, this provider began billing allergy testing and antigen therapy preparation and injections for this same patient.

Records review of this provider’s billing showed references to numerous potentially excluded, unproven and non-medically necessary services including testosterone replacement therapy for male menopause, laser face lifts, laser hair and tattoo removal, laser-lipo body contouring, Botox and chemical peels. Claims not meeting medical necessity and coverage guidelines will be denied for this provider and credited back to the employer’s plan funds.

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Phantom billing: Can you spot it in your claims?

Three seemingly unrelated imaging providers based in FL were identified in a self-funded employer’s medical claims for what was later verified as phantom billing.


The utilization patterns seen in paid claims history for an employee and his wife indicated a strong probability of “phantom” billing – billing for services never performed. Phantom billing typically involves setting up fake corporation(s) with the intent of billing non-rendered services. The individuals involved with the phantom corporations will then recruit patients by offering them an incentive in exchange for allowing their insurance to be billed.

Patients will also be offered incentives to recruit other members of the same insurance plan. Phantom providers start and stop billing within a short period of time in order to avoid detection.

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Cosmetic Surgery Is Ripe for Fraud

Multiple healthcare fraud schemes have been investigated over the years involving providers who misrepresent cosmetic procedures as medically necessary ones to increase patients and their profit. Rhinoplasty is known to be the most common procedure that is inappropriately billed to health insurance. Surgeons charge for repair of a “deviated septum” and then perform cosmetic rhinoplasty. Tummy tucks have also been billed to insurance as hernia repair. Separation of the abdominal muscles is sometimes falsely called a hernia and billed to insurance.


Any effective wasteful spend analysis should routinely conduct review of a focused sample of medical records as an identification and prevention measure. We posted last week about one case.


An example can be seen from a selected visits review ($10,000 – $30,000/per procedure): A 26-year-old female was billed for reduction mammoplasty by a Beverly Hills plastic surgeon. Services that are typically seen prior to this procedure, i.e. physical therapy for back pain or related office visits, were not seen in this member’s medical history prior to surgery.