Case Study: Major New York Health Company achieves $10.5M in savings and prevents $41M in inappropriate spending with Cotiviti

New York health plan cracks massive diagnostic testing scheme for pre-pay FWA savings

Major New York Health Company faced a suspected large-scale diagnostic testing fraud scheme after member complaints flagged services not rendered and unusually high volumes of testing. The payer engaged Cotiviti, which applied its FWA Validation and prospective FWA Validation analytics to uncover aberrant billing patterns—such as claims without referring providers and “impossible days” of procedures—that suggested coordinated fraud across multiple diagnostic groups.

Cotiviti implemented an end-to-end pre- and post-pay FWA approach, placing providers on pre-payment review, performing link analysis to support investigations, and coordinating with law enforcement. That work led to provider terminations, arrests and a 2017 indictment, and delivered more than $10.5 million in direct savings (2015–2017), an estimated $41 million in prospective savings over three years across 200+ providers (about 0.38% of spend), and contributed to charges alleging nearly $146 million in fraud.