Tennessee Finance Commissioner Butch Eley, left, with Gov. Bill Lee during a cabinet meeting. (AP Photo/Mark Humphrey)

NASHVILLE — Tennessee Finance Commissioner Butch Eley said that while a private data firm's initial findings that state health plans erroneously paid $17.58 million in medical bill overcharges were "helpful," a planned "deep dive" is necessary before drawing firm conclusions.

"The information that I received was really at a high level and really didn't provide any real deep dive," Eley told members of the General Assembly's Joint Government Operations Committee last week. "So I think that's the purpose of going back out to really get a handle on what information we're actually looking at."

In its preliminary report in June, Connecticut-based ClaimInformatics says it found state health plans' third-party administrators BlueCross BlueShield of Tennessee and Cigna overpaid at least $17.58 million over a three-year period in bill claims by professional providers such as physicians. Those overpayments are "ready for recovery," the firm said in a 20-page, June 11 report.

That was out of a total of $748.32 million in paid professionals' claims examined by the firm. The report said the data was exclusive of any adjusted claims. It also didn't cover all transactions. Hospitals and surgical centers were among those not included and those charges represent more than 50% of the plan's annual costs.

While helpful, Eley told representatives and senators, "there's a lot of pieces to that that are not gone into in a deep way. So we need to do that further to be really able to make a determination."

The company looked at data provided by the state under a May 27 contract through Tennessee Attorney General Herbert Slatery's office. According to ClaimInformatics' report, the data came from Tennessee government's plan for state and higher education employees and their families as well as retirees.


Read a copy of data firm ClaimInformatics' first contract with Tennessee


That originated from efforts by House Government Operations Committee Chairman Martin Daniel, R-Knoxville, who last year sought the information through state Public Records Act requests. In December, BlueCross and Cigna filed separate federal lawsuits to block the information's release, saying it would compromise their payment rates to providers and other proprietary information used to process claims.

The judge issued temporary injunctions blocking the information's release.

Slatery's office later became involved and contracted with ClaimInformatics, later obtaining some state data. The big data firm did its first-blush for free. Slatery's office is now working on issuing a contract for a full-fledged look at the firm.

After Daniel obtained and released copies of ClaimInformatics' initial report, a BlueCross attorney sent a letter to ClaimInformatics threatening a lawsuit for defamation and other issues.

Daniel, meanwhile, sent his own letter to BlueCross' attorney this week, saying it is "my understanding, however, that the state health care plan claims data received by CI was received and delivered by the Tennessee attorney general pursuant to its and the state's inherent authority to audit and to otherwise insure proper performance by those who undertake work for the state."

BlueCross officials had no immediate comment regarding Daniel's letter.

Daniel told Eley that ClaimInformatics' review "does not even include the facility and surgery center and hospital claims which typically make up 55-60% of health care claims. Given that finding that there's at least $17.5 million of erroneous claims that have been paid, does that make you at least curious as to the accuracy and the ability of third party administrators to manage that claim properly?"

Replied Eley: "It definitely makes me curious. As I said, that's the reason for moving forward to get somebody on board to do a deep dive into this report. There were a lot of things that Finance and Administration was not a part of. I think that was instructed through the attorney general's office and so we were not a part of the methodology of the approach that resulted in the findings that you're talking about."

The finance commissioner also said he agreed the state should "continue to lean into making sure that we're reviewing the claims and billings above what we're currently doing and saving at any opportunity that we have."

Slatery spokeswoman Samantha Fisher later said the "focus of this effort is to ensure responsible stewardship of taxpayers' money."

She said the office is still working with state Comptroller Justin Wilson's office on details before putting the contract for a comprehensive audid out for bid.

Contact Andy Sher at or 615-255-0550. Follow him on Twitter @AndySher1.