Prime Therapeutics’ advanced fraud, waste and abuse program saved its health plan clients $285 million in 2020

Telemedicine schemes contribute to a 60% increase in reported false claims during pandemic year 2020

August 11, 2021
EAGAN, Minn. – In the second full year of its advanced fraud, waste and abuse (FWA) program, Prime Therapeutics LLC (Prime), a pharmacy benefit manager (PBM) serving nearly 33 million members nationally, saved its health plan clients $285 million by using a comprehensive approach to mitigate FWA in health care.

Unfortunately, fraud schemes involving drugs billed but not requested and/or received ramped up while the country was locked down. The artificial intelligence (AI) component of Prime’s FWA program found concerning trends that led investigators to identify a 60% increase, from 2020 to 2021, in the number of members reporting they noticed false claims in their prescription drug history.

Pandemic contributes to increased telemedicine fraud schemes

Telemedicine schemes contribute to false claims and have challenged the health care industry over the last five years. In fact, the Office of the Inspector General (OIG) estimates the U.S. lost $6 billion in 2020 due to a single telemedicine related fraud take down.1 With many everyday activities going virtual during the pandemic in 2020, the environment was ripe for fraudsters to increase their use of telemedicine to deceive providers, payers, pharmacies and consumers.

Prime observed a similar, significant spike. In a single investigation, one pharmacy’s use of high-risk, low-value products – often used in telemedicine schemes – increased from $0 to $300,000 in less than one month. Prime also noted an influx of reports to its anonymous FWA hotline from members who denied receiving the medicine for which they were billed, knowing the prescriber on the claim, or knowing the pharmacy at all. After the pharmacy failed to respond to repeated requests for information, Prime terminated the pharmacy from its network and reported the pharmacy to the Board of Pharmacy and Department of Insurance. The investigation recovered the majority of the funds.

Prime’s award winning² FWA program

Prime’s advanced FWA program launched in mid-2018. Through year-end 2020, Prime’s FWA program has garnered more than $640 million in savings. Of that total, more than $100 million came from FWA recoveries and more than $535 million were avoided costs.

Prime’s FWA program contains many components:

  • Clinical products: Formulary development, pharmacy networks and utilization management are a first line of defense to identify and remove most forms of FWA.
  • FWA products: These products filter any remaining suspicious pharmacy and medical claims after clinical products have been applied. Examples include pharmacy, member and prescriber investigations, an anonymous FWA hotline, and audits.
  • Collaborative approach: Prime collaborates with its health plan clients’ special investigative units to help identify top priority cases.
  • Deep analytics: Prime’s platform can provide unique link analysis to see the complete FWA picture by examining both pharmacy and medical claims regardless of source – pharmacy, prescriber or member – and mapping their connections. This helps identify more fraud themes and patterns, prioritizes them, and focuses on the most harmful or highest cost issues first.

“All of Prime’s efforts in the fraud, waste and abuse space focus on opportunities to protect members from potentially harmful situations and deliver cost savings –$8.63 per member in 2020, which is more than three times the FWA savings of larger PBMs,” said Anne Mack, senior director of network compliance at Prime. “As schemes evolve over time, I’m pleased Prime’s advanced analytics, artificial intelligence and highly-trained team is well prepared to continue uncovering those savings and root out bad actors that drive up the cost of medicines for all.”

To learn more about Prime’s FWA efforts and read additional case studies, visit Prime’s blog.


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