MCLEAN, Va., June 30, 2011 -- Northrop Grumman Corporation (NYSE:NOC) will develop a fraud prevention system to help identify high-risk claims in support of the Centers for Medicare & Medicaid Services' (CMS) National Fraud Prevention Program. The program's mission is to prevent and detect fraud, waste, abuse and other improper payments under the Medicare program.

The Predictive Modeling Development task order was awarded under the CMS Enterprise System Development indefinite delivery, indefinite quantity contract. The task order is valued at $77 million over one year with three, one-year option periods.

Predictive modeling is a combination of advanced analytic techniques, including predictive analytics, linkage analysis, outlier analysis, network analysis, behavioral analysis and other statistical techniques. The vision of the National Fraud Prevention Program is to implement proven predictive modeling tools into the claims processing system to stop payment on high risk claims.

To achieve CMS' goal, the Northrop Grumman team will design, develop and implement a system that uses analytic approaches to generate alerts and evaluate results to identify and help prevent improper payments, fraud and abuse.

"This critical program will help prevent the misuse of taxpayer dollars that can result from waste, fraud, and abuse of the Medicare program, which will in turn decrease health care costs," said Amy Caro, Northrop Grumman's vice president of health information technology programs. "Our uniquely qualified team will implement proven solutions and industry best practices that will help prevent fraudulent transactions before they occur, rather than identify fraudulent activity after the fact."

Northrop Grumman will implement predictive modeling and other analytic technology systems capable of reporting alerts based on risk scoring applied to near real-time claims beginning July 1, 2011.

The company's teammates include National Government Services, Indianapolis, Ind., and Federal Network Systems, a Verizon company, Herndon, Va.

Northrop Grumman is a leading global security company providing innovative systems, products and solutions in aerospace, electronics, information systems, and technical services to government and commercial customers worldwide. Please visit for more information.

  CONTACT: Christy Whitman
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