I recently heard CMS's Peter Budetti speaking at the National HIPAA Conference, and he said CMS is working with other government agencies to create a methodology for calculating the value of cost avoidance measures designed to prevent fraud from happening. He was referring specifically to CMS's Fraud Prevention System, which uses predictive modeling to prevent fraud from occurring in the first place. A December 2012 report from CMS said the FPS helped stop, prevent, or identify roughly $115 million in fraudulent payments during its first year of operation.

In a sign of the difficulty in calculating the level of fraud prevented by the FPS, the OIG released a report in December that took issue with the approach CMS used in coming up with the estimated actual savings and projected savings of the FPS. For example, while the CMS report said the FPS was responsible for $83.6 million in estimated projected savings, the OIG could not determine the accuracy of $68 million of the projected savings. The OIG also questioned the return on investment rate (3-to-1) that was included in the CMS report, saying it was based on questionable actual and projected savings figures.