Artificial Intelligence the next frontier for fighting healthcare fraud

by David Keelaghan12 May 2017
Like a Swiss army knife, data analytics is a tool with multiple uses for the life and health insurance industry. Being able to utilize big data is allowing providers to streamline the underwriting process, thus making the application process less burdensome for consumers. Advancements in technology are also allowing insurance companies to combat fraud, which is a significant problem across Canada. The CLHIA says its members provide supplemental health coverage to 24 million Canadians, paying over $30 billion annually. Estimates of fraudulent claims in North America range from 2–10% of total claims, so it’s certainly a large enough number to deserve the industry’s full attention.

The CLHIA Claims and Anti-Fraud Annual Conference held in Montreal this week saw various providers congregate to discuss strategy to combat healthcare fraud. It is now commonly accepted as fact that data analytics and artificial intelligence will lead the next generation in fraud detection. At the conference, Irish software firm ClaimVantage displayed its ClaimFirst solution that will incorporate data analytics and AI applications designed by Salesforce.

Present in Montreal was Joan Weir, director, Health and Disability Policy at the CLHIA. She identifies some of the common cases of fraud in the life and health space.  

“It could be claims that were submitted where the services simply didn’t happen,” she says. “Another common case is what we call up-coding – that is where there is a higher charge for a higher set of services than is actually delivered. Sometimes there is even collusion between the provider and the patient.”

The investigation process can be laborious, and in the past focused mainly on following a paper trail. “Some insurers send out confirmation letters to their members to their members to ask if they actually received the service that was billed for. So they might ask for back-up documentation from providers or members to substantiate the claim.”

As attendees at the Anti-Fraud Annual Conference will have found, however, there are a lot more options available to those tracing fraud cases in 2017. Data analytics already means providers have more advanced means of identifying bogus claims, and the development of AI programs will boost that capability massively in the years to come.  

“It means things like profiling healthcare providers and comparing them to other providers in the area to see what kind of services are being billed and are they out of the norm,” says Weir. “Data analytics is a big part of figuring out what sort of claim profiles do not fit within the norm.”

When a healthcare provider or individual is found to have committed fraud, there are a number of possible scenarios that can play out, none of which will be enjoyable for the guilty party.

“One of the avenues our members would take is going to the relevant regulatory college,” Weir says. “As the body that issues providers their licence, a complaint would then be handled by them. They would look into the compliant and decide what punishment to give; a suspension of your licence is typical.”

Related stories:
Healthcare fraud in North America a multi-billion dollar problem
Market-leading claims management software to be showcased at CLHIA conference