fraud detection

By: Claim Analytics  09-12-2011

Claim Analytics, Predictive Modeling, Predictive, Model, predictive model, Insurance, Benchmarking, Scoring, Claims, Data Mining, Patter Detection, Acturial, Actuary, Long Term Disability, disability, claims data model sample, fraud detection, probablility

A New Tool In The Anti-Fraud Arsenal

Healthcare fraud is a cat-n-mouse game!

Fraudulent service providers will develop schemes to over bill for services provided, or even services not provided. Any scheme which passes through the payers’ rules-based systems will be exploited by the fraudsters until the payers catch on and add a new rule.

Claim Analytics provides a NEW approach.

A new approach is needed to provide a second layer of protection for insurers, an approach that can detect novel and undetected schemes that a rules-based approach will miss.

Claim Analytics technology is particularly strong in fraud detection in its ability to expose emerging fraudulent practices:

  • Examines millions of submitted claims
  • Identifies atypical claims
  • Open-minded unbiased analysis
  • Pre-payment identification of suspect claims
  • Works with lightning speed

Our technology goes beyond traditional rules-based approaches By comparing each claim to every other claim, and each practitioner to every other practitioner, our technology goes beyond traditional rules-based approaches to fraud detection.

  • This open-ended approach identifies virtually any type of atypical activity, rather than only those defined by a pre-determined set of rules.
  • Claims departments can become more efficient by focusing their investigative and recovery resources on the outlier providers.
  • Prepayment screening becomes more effective by measuring how typical or abnormal any given claim is.
  • Different levels of tolerance can be allowed, depending on the profile of the service provider, before referring the claim for manual adjudication.

The claim history of each provider is compared to every other provider of the same specialty and outlier are quickly and easily identified. Isolating the atypical providers offers significant opportunities for both payment recovery and prepayment screening.

We look at the bigger picture.

Previous generation fraud detection tended to focus on the individual claim level. However, this doesn’t take into account who the claimant or practitioner is, and the nature of their claim history.

We use individual claims as building blocks to grow a bigger, clearer picture of activity at the level of individual practitioners and individual claimants. We don’t consider each claim in isolation we take into account the entire history of work for each practitioner, and for each patient, allowing our model to find and quantify more types of irregularities.

Atypical providers are easily identified and understood.

The models find similiarities and differences between all claims and categorize each into one of a small number of clusters. The distribution of claims by cluster for each service providers can be compared to the aggregate distribution. Atypical providers are then easily spotted and why they are atypical can be understood.

Predictive Modeling and Dental Fraud Detection

Other products and services from Claim Analytics


claim scoring

Claim scoring uses advanced pattern detection technology to provide a numeric measurement of the likelihood of return to work of a disability claim. This accurate and objective measurement of disability or workers compensation claims enables the optimizing of all claim management resources. Forecasting Return to Work with Predictive Modeling By Barry Senensky and Jonathan Polon.



Traditional methodologies are constrained by their inability to manage more than a very limited set of claim differentiators: at best age, gender, elim period and one or two others. The Claim Analytics approach is to apply advanced predictive modeling techniques to determine precise, claimant-specific termination rates. This methodology results in reserves for each claimant that reflect that claimant’s true probability of terminating.


claim approval

The model was built by quantifying patterns in historical approval decisions and applying this logic to score newly reported claims on the likelihood that they would be approved based on an insurance companies existing practices. A score of 2 will indicate that eligibility and compliance to the duration guidelines need to be checked and then the claim can be approved.



The same pattern-detection tools used by Claim Analytics are the tools of choice for many of the world’s toughest and most complex applications – credit card fraud detection, consumer buying prediction, weather forecasting, and taxpayer profiling. The Claim Analytics pricing approach incorporates claimant-specific reserves for each open claim. Disability Insurance PricingBetter Analysis For Improved Pricing Accuracy.