Industries / Health Insurers

Fraud and Improper Payments

Detect, prevent and combat fraudulent activity in health care

Health insurance fraud costs the industry an estimated $70 billion to $260 billion in the US and $30 billion to $100 billion in the EU each year. Historical fraud detection methods only uncover about 10 percent of losses, and because of the post-payment nature of such methods and the resulting pay-and-chase recovery process, less than 5 percent of losses detected are ever recovered. Fueled by technology advancements that have made crimes such as identity theft and multiparty fraud schemes both easy to commit and hard to detect, health care fraud continues to grow. It holds particular appeal for organized crime syndicates, which account for a growing proportion of health care fraud, waste and abuse.

" SAS helped us implement robust health care fraud detection software within a 90 day time frame. The software is already helping to detect issues in pharmaceutical claims we're receiving. The SAS team has listened to and met all our needs and has worked well with our internal team."

— Mike Occhipinti

Director, Informatics
Business Intelligence and Data Management
Horizon BCBSNJ

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How SAS® Can Help 

Improvements in prepayment fraud detection could mean up to hundreds of millions of dollars in savings. SAS takes an enterprise approach to fraud, waste and abuse detection and prevention by providing a hybrid software solution that enables you to:

  • Ensure accurate, reliable data by using comprehensive information management capabilities to:
    • Transform vast amounts of data (including text-based data) into a meaningful format.
    • Restructure and group data into categories for easier analysis.
  • Take a unique, hybrid approach to fraud detection that combines business rules, anomaly detection, predictive modeling and network analytics, enabling you to:
    • Detect fraud and improper payments before claims are paid.
    • Spot hidden connections, patterns and anomalies – often years ahead of traditional methods.
  • Quickly uncover organized fraud rings and identify targets that are likely to lead to emerging or migrating schemes.
    • Expose previously hidden relationships among entities using social network analysis.
    • Actually see connections between discrete episodes of fraud, waste and abuse with a unique visualization interface.
    • Build fraud propensity scores on new events by using predictive modeling techniques on prior cases of known fraud.
  • Improve investigator efficiency.
    • Build fraud propensity scores using predictive modeling techniques (e.g., decision trees and neural networks).
    • Employ prioritization methods to route potentially fraudulent claims to the right resource based on type, skill set, experience and workload.
  • Get up and running quickly by using pre-packaged, ready-to-use heuristic rules and analytic models, then easily modify models and rules to meet your specific needs.

How SAS® Is Different 

Only SAS takes a hybrid approach to combating fraud, waste and abuse by combining four key analytic methods – business rules, anomaly detection, predictive models and network analytics – into a single solution. With SAS, you get:
  • Pre-payment fraud detection and alert generation. Uncover suspicious activity using multiple analytic techniques, and automatically route suspicious cases for review.
  • Alert management. Automatically assemble alerts from multiple monitoring systems, associate them with common individuals or entities, and automatically prioritize and route potentially fraudulent cases to appropriate team members.
  • Social network analysis. Identify targets for investigation by analyzing all related activities and relationships at a network dimension, so you can detect previously hidden linkages and uncover organized fraud rings.
  • Optional case management capabilities. Available as a separate solution, case management capabilities let you systematically facilitate investigations, and capture and display all information pertinent to a case without corrupting the system with duplicate data entry.
  • Advanced text analytics and data mining. Analyze both structured and unstructured text data to reveal fraudulent activities that would otherwise go unnoticed.

Related Products and Solutions

SAS® Fraud Framework for Health Care

Fraud, waste and abuse cost the health care industry billions of dollars each year. Health payers pass losses on to consumers in the form of higher premiums. Money lost to fraud and abuse is money that can’t be spent on improving the quality of care for those incurring valid expenses. Unfortunately, fraud often isn’t discovered until after claims are paid – and recovery of funds is unlikely. The SAS Fraud Framework for Health Care can help. 

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SAS® Enterprise Case Management

SAS Enterprise Case Management enables investigators and operational risk managers in a variety of industries – banking, insurance, government, health care, etc. – to streamline processes and conduct more efficient, effective investigations, leading to reduced costs and better fraud prevention. The solution provides a structured environment for managing investigation workflows, attaching comments or documentation and recording financial information, such as exposures and losses.

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Ready to learn more?

Call us at 1-800-727-0025 (US and Canada) or request more information.