Medicare is a federal program that provides health insurance coverage for individuals aged 65 and older and for certain disabled persons. It is funded by general revenues, payroll taxes paid by most employees, employers, and individuals who are self-employed, and beneficiary premiums. Medicare consists of four parts. Medicare Part A provides payment for inpatient hospital, skilled nursing facility, some home health, and hospice services, while Part B pays for hospital outpatient, physician, some home health, durable medical equipment, and preventive services. In addition, Medicare beneficiaries have an option to participate in Medicare Advantage, also known as Part C, which pays private health plans to provide the services covered by Medicare Parts A and B. Further, all Medicare beneficiaries may purchase coverage for outpatient prescription drugs under Medicare Part D, and some Medicare Advantage plans also include Part D coverage. In 2010, Medicare covered 47 million elderly and disabled beneficiaries and had estimated outlays of about $509 billion. CMS uses contractors to help administer the claims processing and payment systems for Medicare. These administrative contractors are responsible for processing approximately 4.5 million claims per workday. The contractors review the claims submitted by providers to ensure payment is made only for medically necessary services covered by Medicare for eligible individuals. Medicaid is the federal-state program that provides health coverage for acute and long-term care services for over 65 million low-income people. It consists of more than 50 distinct state-based programs that each define eligibility requirements and administer payment for health care services for low-income individuals, including children, families, the aged, and the disabled. Within broad federal requirements, each state operates its Medicaid program according to a state plan. Low-income Americans who meet their state’s Medicaid eligibility criteria are entitled to have payments made on their behalf for covered services. States are entitled to federal matching funds, which differ from state to state but can be up to three- fourths of their costs of this coverage. The amount paid with federal funds is determined by a formula established in law. CMS oversees the Medicaid program at the federal level, while the states administer their respective programs’ day-to-day operations, such as enrolling eligible individuals, establishing payment amounts for covered benefits, establishing standards for providers and managed care plans, processing and paying for claims and managed care, and ensuring that state and federal health care funds are not spent improperly or diverted by fraudulent providers. The estimated outlays for Medicaid for both the federal and state governments were $408 billion in 2010. Of this cost, approximately $275 billion was incurred by the federal government and $133 billion by the states. The Health Insurance Portability and Accountability Act (HIPAA) of 1996 established the Medicare Integrity Program to increase and stabilize federal funding for health care antifraud activities. The act appropriated funds for the program as well as amounts for HHS and the Department of Justice to carry out the health care fraud and abuse control program. Subsequent legislation further outlined responsibilities under the Medicare Integrity Program. Under the Medicare Integrity Program, CMS staff and several types of contractors perform functions to help detect cases of fraud, waste, and abuse, and other payment errors, which include reviews of paid claims to identify patterns of aberrant billing. Among these program integrity contractors are program safeguard contractors, zone program integrity contractors, and Medicare drug integrity contractors. The program safeguard and zone program integrity contractors are responsible for ensuring the integrity of benefit payments for Medicare Parts A and B (including durable medical equipment), as well as the Medi-Medi data match program. Medicare drug integrity contractors are responsible for monitoring fraud, waste, or abuse in the Medicare prescription drug program (i.e., Part D). These contractors work with the HHS Office of the Inspector General (OIG) and law enforcement organizations, such as the Department of Justice, to help law enforcement pursue criminal or civil penalties when fraudulent claims are detected. Table 1 summarizes the origin and responsibilities of the program integrity contractors who help CMS to detect fraud, waste, and abuse. In addition to provisions of HIPAA and other legislation intended to strengthen Medicare program integrity functions, in 2006 Congress created the Medicaid Integrity Program through the Deficit Reduction Act of 2005. Its goals are to strengthen the national Medicaid audit program and to enhance federal oversight of and support and assistance to state Medicaid programs. The program provides states with technical assistance and support to enhance the federal-state partnership as well as to expand activities that involve data analysis, sharing algorithms of known improper billings, and fraud awareness through education and outreach. Individual states are responsible for ensuring the accuracy of Medicaid payments within their state programs, which can involve using their own staff or contractors to analyze claims to detect improper payments. In addition to the states’ efforts, CMS employs Medicaid program integrity contractors to perform specific activities as part of its efforts to detect fraud, waste, and abuse in the Medicaid program, such as reviewing provider claims payments that have been processed by the states. Generally, each state Medicaid program integrity unit works independently, using its own data models, data warehouses, and approach to analysis. As a result, Medicaid data are stored in multiple disparate systems and databases throughout the country. Because of the volumes of work, states often augment their in-house capabilities by contracting with companies that specialize in Medicaid claims and utilization reviews. State Medicaid program integrity units target their activities to those providers that pose the greatest financial risk to their Medicaid programs. However, the states have limited methods of identifying Medicaid fraud in neighboring jurisdictions or by providers who move from state to state. As stated in a July 2007 report by the HHS OIG, the agency intends for program integrity contractors to perform a significant amount of self- initiated, exploratory analysis to seek patterns or instances of fraud and abuse. One of the specific activities undertaken by these contractors is the analysis of claims data to identify improper billing that may indicate fraud or abuse. If the billing appears to be potentially fraudulent or abusive, the contractors take further actions, which can include requesting and reviewing medical records associated with the claims and referring the case to law enforcement. In 2010, CMS created the Center for Program Integrity to serve as its focal point for all national Medicare and Medicaid program integrity fraud and abuse issues. The new center is responsible for, among other things, collaborating with other CMS components to develop and implement a comprehensive strategic plan, objectives, and measures to carry out the agency’s program integrity mission and goals, and ensure program vulnerabilities are identified and resolved. According to agency documentation describing the program, the center was designed to promote the integrity of the Medicare and Medicaid programs through provider and contractor audits and policy reviews, identification and monitoring of program vulnerabilities, and support and assistance to states; collaborate on the development and advancement of new legislative initiatives and improvements to deter, reduce, and eliminate fraud, waste and abuse; oversee all CMS interactions and collaboration with key stakeholders related to program integrity (e.g., the Department of Justice, HHS OIG, and state law enforcement agencies) for the purposes of detecting, deterring, monitoring, and combating fraud and abuse; and take action against those who commit or participate in fraudulent or other unlawful activities. Like financial institutions, credit card companies, telecommunications firms, and other private sector companies that take steps to protect customers’ accounts, CMS uses automated software tools to help predict or detect cases of improper claims and payments. For more than a decade, CMS and its contractors have applied such tools to access data from various sources to analyze patterns of unusual activities or financial transactions that may indicate fraudulent charges or other types of improper payments. For example, to identify unusual billing patterns and to support referrals for prosecution or other action, CMS and program integrity contractor analysts and investigators need, among other things, access to information about key actions taken to process claims as they are filed and specific details about claims already paid. This includes information on claims as they are billed, adjusted, and paid or denied; check numbers on payments of claims; and other specific information that could help establish provider intent. These data, along with data on regional or national trends on claims billing and payment, support the investigation and potential prosecution of fraud cases. Upon completing investigations, the contractors determine whether to refer the investigations as cases to law enforcement officials. CMS and its program integrity contractors currently use many different means to store and manipulate data and, since the establishment of the agency’s program integrity initiatives in the 1990s, have built multiple databases and developed analytical software tools to meet their individual and unique needs. However, according to CMS, these geographically distributed, regional approaches to data analysis result in duplicate data and limit the agency’s ability to conduct analyses of data on a nationwide basis. Additionally, data on Medicaid claims are scattered among the states in multiple disparate systems and data stores, and are not readily available to CMS. Thus, CMS has been working for most of the past decade to consolidate program integrity data and analytical tools for detecting fraud, waste, and abuse. The agency’s efforts led to the initiation of the IDR program and, subsequently, the One PI program, which are intended to provide CMS and its program integrity contractors with a centralized source that consolidates Medicare and Medicaid data from the many disparate and dispersed legacy systems and databases and a Web-based portal and set of analytical tools by which these data can be accessed and analyzed to help detect cases of fraud, waste, and abuse. The CMS Office of Information Services is responsible for agencywide IT management. Its initiative to develop a centralized data warehouse began in 2003 as an element of the agency’s Enterprise Data Modernization strategy. According to agency documentation, the strategy was designed to meet the increasing demand for higher quality and more timely data to support decision making throughout the agency, including identifying trends and discovering patterns of fraud, waste, and abuse. As part of the strategy, the agency established the Data Warehouse Modernization project to develop and implement the technology needed to store long- term data for analytical purposes, such as summary reports and statistical analyses.