How does the Claim Analytics fraud detection approach differ from current methodologies?
The most common approach to fraud detection is to apply rules-based technology. Claims are screened for procedures that match known types of fraud. This approach has two weaknesses. • A rules-based approach cannot screen for new, unknown, types of fraudulent behavior. • A rules-based approach does not recognize that each practitioner/claimant has a history of claims and that some practitioners/claimants have demonstrated a greater or lesser degree of atypical activity. The Claim Analytics approach to screening for fraud is to analyze all claims paid by the insurer over the past 12 or more months. We use advanced pattern-detection technology to: • Categorize each claim as typical or atypical, • Roll this information back up to the practitioner level, and thereby • Identify practitioners with atypical claims patterns. Our approach allows the insurer to identify and concentrate on those practitioners with the most suspicious claims activities regardless of whether or not their behaviors m
