The Death Master File is a file maintained by the Social Security Administration that contains over 86 million records of deceased individuals in the U.S. It contains their SSN, name, birth date, and death date. This file is useful for fraud detection because many fraudsters purposely utilize SSNs of the dead to incorporate fake businesses, or try to obtain false claims in the name of a deceased individual. One industry that has been particularly damaged by this type of fraud is our Medicare and Medicaid healthcare programs. According to a 2008 Congressional Report, Medicare has paid out as much as $92 million to 18,240 dead doctors, and this is not including payments made for dead patients. Imagine the monetary consequences as Obamacare is rolled out without any fraud protection against services after death.
Medicare and Medicaid are not the only victim programs however. In Washington DC’s largest tax fraud scheme in history, Harriette Walters stole $48 Million as a manager in the Property Tax Refund department. One of her methods was to intercept refund checks made out to deceased individuals that were returned to the government. Then, Walters and her co-conspirators changed the payee name and cashed the check at a check cashing store.
Fortunately, this is a relatively easy problem to prevent and detect using the Death Master File. By scrubbing data against this massive file, one can determine if the individual is deceased or not. Sadly, the SSA deleted pertinent fields such as zipcode of the person’s last residence, which helped to locate the correct individual. HIPAA pressure forced SSA to somewhat protect the identity of the dead.
Because the Death Master File is so large, it takes a processor and software with substantial processing power, such as SAS. Automated Auditors uses SAS on a daily basis for data mining and statistical analysis, and 86 million records can be processed efficiently. Our rates for batch processing are competitive with SSA’s prices and we offer a flat fee instead of a sliding scale based upon number of records searched.
President Christine Warner recently wrote an article on using the Death Master File to detect fraud, with co-author Cheryl Hyder. The article, titled “Death Fraud: This Identity Theft is Alive and Kicking” was published in Fraud Magazine in the Sept/Oct 2010 issue. Christine and Cheryl were awarded the Hubbard Award from the Association of Certified Fraud Examiners (ACFE) for the most influential article of the year. Click HERE to read the article on death fraud.