Healthcare Claims Loss Control System
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Solution Overview
Problem
Current healthcare claim processing systems face challenges in effectively controlling losses due to fraudulent claims, coding errors, and inefficient resource coordination, leading to unwarranted payments and high costs, with limited ability to identify and mitigate these issues before payment is made.
Innovation Solution
A healthcare claims loss control system and method that intervenes prior to payment, providing a single point of contact for payers, providers, and other entities to evaluate claims for fraud, validate coding, identify discounts, and develop analytics to recommend loss control measures, thereby reducing losses and improving claim accuracy and timeliness.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Loss of time
If internal processing by payer is conducted to process and pay claims in a timely manner, then claim payment timeliness is improved, but loss control capability deteriorates due to limited ability to identify fraudulent claims and coding errors
Solution Approach 1:
The system performs preliminary loss control evaluation of claims before payment is made. The external loss control service provider analyzes claims for fraud, abuse, and coding errors prior to payer payment, enabling identification and correction of issues before funds are disbursed, thus maintaining both timeliness and reliability.
Solution Approach 2:
An external loss control service provider acts as an intermediary between the payer and providers. This intermediary service evaluates claims independently, providing an additional layer of review that enhances loss control capability without significantly delaying payment processing, as the service operates in parallel with or just before the payer's payment workflow.
2Reliability
If more thorough loss control processes are enacted, then loss control capability is improved, but return on investment deteriorates due to insufficient ROI for payers
Solution Approach 1:
The system enables providers to self-correct claims by providing them with loss control evaluation results, including identified errors, fraud indicators, and coding issues. Providers can then submit corrected claims, reducing the need for costly payer recovery processes and improving ROI by preventing losses before payment rather than requiring post-payment recovery.
Solution Approach 2:
The system provides feedback to both payers and providers regarding claim evaluation results, including specific identification of fraud, abuse, and coding errors. This feedback mechanism enables continuous improvement of claim accuracy and loss control effectiveness, demonstrating measurable ROI through reduced unwarranted payments and improved claim processing efficiency.
3Measurement precision
If comprehensive claim evaluation is performed to identify fraudulent claims and coding errors, then claim accuracy is improved, but processing complexity deteriorates due to complex coding and coordination requirements
Solution Approach 1:
The system extracts the complex loss control evaluation function from the payer's internal processing system and places it with an external service provider. This separation removes processing complexity from the payer while maintaining comprehensive claim evaluation, as the external provider handles the sophisticated analysis of fraud, abuse, and coding errors using specialized tools and expertise.
Solution Approach 2:
The external loss control service provider performs multiple functions within a single coordinated system: evaluating fraud, detecting abuse, validating coding accuracy, and providing feedback to both payers and providers. This multi-functional approach consolidates various complex processes into one universal service, reducing overall system complexity while maintaining comprehensive claim accuracy.
4Adaptability or versatility
If different clients have different formatting of information, then adaptability to client requirements is improved, but coordination efficiency deteriorates due to complicated resource coordination
Solution Approach 1:
The system accommodates different client formatting requirements by allowing parameter changes in data input formats for each client while maintaining standardized internal processing. The external loss control service can adapt to various client-specific formats without requiring changes to the core evaluation methodology, thus preserving both adaptability and coordination efficiency through flexible interface design.
Data Source
AI summary
A method for controlling healthcare claim payment losses including accessing information about a claim after a payer is prepared to pay, but prior to payment, evaluating the information including at least one of determining indications of fraud, validating service coding and editing as indicated, identifying possible payment discounts, and developing analytics indicative of risk for future claims, and providing loss control recommendations based at least partially on the evaluation, prior to paying the claim. Also a loss control system for healthcare claims with a loss control engine and a database in communication with the loss control engine, wherein the loss control engine accesses information about healthcare claims from the database after the claims have been processed for payment and wherein the loss control engine further analyses the claims for potential cost savings and returns a loss control recommendation for each claim to the database before payment of the respective claim.