Developing the foundation for achieving claims excellence

The importance of effective health insurance claims and benefits management

Health insurance claims and benefits management is a frontier ripe for innovation. Estimates of loss to claims leakage in the private health insurance system in Australia range from 1–7%, though anecdotally, our customers tell us this may be as high as 7–11%. A 1.5% loss to claims leakage equates to over $300M, representing only the direct financial cost and not any extended remediation to find and recover leakage. Fraud, waste and abuse (FWA) impedes the ability to effectively manage revenue cycles. It also potentially erodes confidence in provider relationships, creating barriers closer strategic alignment.

On average, Australian health insurers give 87 cents of every premium dollar back to members in benefits. Upward pressure on the cost of these benefits is the primary driver of premium increases for members every year. With industry management expenses averaging a further 9 cents, sustaining margin performance while maximising member value is a tug of war for Insurers.

Many leading private and public health programs globally are taking advantage of modern technologies to address these issues. They are utilising tools such as:

• Rules based workflows
• Automated pricing and adjudication
• Artificial intelligence and machine learning
• Configurable, extensible and API enable cores

How the right tools can optimize health insurance claims and benefits management

Claim processes are complex and are entangled in inefficient processes, siloed data, and user error. But improving claims processes can be relatively straightforward with the right tools, and the benefits reaped will be significant for both insurer profitability and member experience.

The importance of accurately priced claims

Calculating and paying benefits on incorrectly submitted provider fees is a sure way to cause erroneous reimbursement. Effective claims pricing is enabled by efficiently managed provider data, integrated provider contracts, and automated claims pricing by leveraging adaptive, rules-driven solutions. As a result, accurately priced claims immediately deliver reductions in claims leakage. Previously, claims pricing and adjudication have operated in silos. These must be interconnected to streamline operational processes and maximise margins by reducing frictional costs across the value chain.

Look for a solution that delivers:

• Real-time claims processing—no need to wait for batch processes
• Preconfigured processing flow, with the ability to modify system behaviour at various points in the claims flow
• High levels of auto-adjudication rates
• Complete traceability of applied rules and decisions, and configurable claims messages for maximum transparency

The advantage of automated adjudication

To achieve highly accurate auto-adjudication at scale, technology must be built for purpose and be highly adaptable and transparent. The ability to manage variations in product benefits, facilitate eligibility checks, set combination rules, and provide limit detection and counters are critical for this purpose. However, claim automation should extend beyond a ‘straight-line’ adjudication workflow. Interaction in real-time with external systems, such as peripheral reference data, rule engines, groupers or algorithms during the adjudication workflow is key to gaining the high levels of conclusiveness an accomplished claims process requires.

Additionally, adjudication should not be a set and forget exercise. Data should be accessible and timely to power analysis in guiding continual improvements in workflow. Discovering opportunities for improving claim integrity is one thing; making the necessary changes to realise value from them is another. This is where technology needs to break free from change limitations and allow subject matter experts to quickly test and deploy valuable improvements in accuracy and auto-adjudication rates. Many legacy environments aren’t adequately configurable to take advantage of opportunities to adapt and change in a timely manner.

Artificial intelligence in health insurance

Health insurance is anything but a linear process. The legacy approach to claims management based on inflexible rules has been made obsolete by the availability of modern, flexible and agile rules-driven solutions. The next evolution is integrating intelligent algorithms into core workflows that learn from historical data and continuously evolve. From outlier and anomaly detection to analytically identifying and correcting mistakes while avoiding unnecessary, costly interventions, AI can help Insurers optimise services, lower costs, accelerate processes, and make better decisions.

As the Australian private health insurance industry navigates a transition path into a new paradigm driven by cost pressures and reform, there are immense opportunities for artificial intelligence (AI) technologies. A potential example involves business models shifting to wellness and preventative care by predicting and more precisely managing and treating disease. Available technologies such as IoT, AI, and machine learning (ML) can provide predictive diagnostics, next best actions and ultimately healthier longer lives, thus efficiently delivering a new value proposition to Australians.

Innovation in health insurance: Oracle Health Insurance

Oracle Health Insurance Claims Administration

Oracle Health Insurance Claims Administration comprises service-orientated modules that form a highly adaptable, automated end to end claims solution for the private health insurance industry. Its rules-driven approach to claims processing allows insurers to implement an efficient, accurate, and auditable claims process. Transactions entering Oracle Health Insurance Claims Administration undergo a series of highly configurable rules-based steps, with each step in the workflow defined to manage a specific part of the end-to-end adjudication process and containing parameters and logic for ensuring the highest performance in claims processing.

Oracle Insurance Gateway

Included with Oracle Health Insurance is the Oracle Insurance Gateway (OIG). Providing substantial interoperability capability, OIG streamlines the integration of OHI components with other systems within a technology landscape.

• Supports a wide variety of integration scenarios
• Supports multiple integrations flows: Scheduled or invoked separately
• Collect data from the source system
• Invoke external processes
• Transform data for compliance purposes
• Deliver data to single or multiple target system(s)

Oracle data and AI offerings

Oracle continues to work closely with customers and the industry worldwide to learn and support the innovation potential. Our customer advisory board extends this beyond the continuing advancement of the OHI application and Oracle underlying technologies into developments and partnerships that provide OHI customers access to all insight and innovation that only Oracle can provide through its broad industry relationships.

OHI is currently engaging internally and externally to work within innovations such as:

• Blockchain (Smart Contracting, e.g. Out-of-Network claims)
• Wellness (Quantification of wellness against claims expense)
• FHIR standard Interoperability