What’s the cost of health insurance fraud in the US?

As much as $300 billion of the nation’s healthcare spending, says the National Health Care Anti-Fraud Association (NHCAA), but as a review of the dilemma at HealthPayerIntelligence points out, that number doesn’t account for the millions of affected patients. 

The problem isn’t new, of course, but the article points to what is new: the addition of new AI to the effort to root out and protect against health insurance fraud.

According to Kurt Spears, vice president of financial investigations and provider review for Highmark Inc., a Pittsburgh-based provider of a range of health insurance options, his company recently added AI to what was already a multi-pronged investigative approach that includes the expertise of registered nurses, investigators, accountants, former law enforcement agents, clinical coders and programmers, and others.

“We're trying to use the AI tool to add reasoning into the analytics that we use,” Spears said.

And the company is already seeing positive results. 

In a recent press release, Spears explained that “The goal of AI is to adapt quickly to changing behavior and to help predict aberrances earlier than traditional tools that often rely on established rules to catch suspicious behavior.  We know it is much easier to stop these bad actors before the money goes out the door than pay and have to chase them.”

According to the company, in 2019, Highmark’s anti-fraud team saved $260 million in prevented losses, recovered funds, and policy savings through a combination of its traditional multi-pronged approach and the addition of AI. That is the highest savings it has seen in the past five years.

“My main goal is to help protect the health and safety of our customers, protect them from fraud, waste, and abuse, as well as being good stewards of their healthcare dollars,” Spears said. “And this is just one more tool for us to try to get in front of issues before they get too far down the line.”

In his view, payer executives can support their anti-fraud departments first and foremost by maintaining their companies’ focus on the consumer’s welfare, while also supporting the implementation of models that identify risks.

But AI alone isn’t enough, Spears said. Given the growth of well-funded national fraud schemes, the nation’s health plans have to band together.

“The health plans are going to have to continue to come together more and work together even more closely,” Spears warned. “We’re going to continue to have to be aligned on anti-fraud strategies and methodologies to have the biggest impact we can.”