Is the health insurance claims space ripe for IDP? | Insurance Business Australia
Insurance companies are increasingly adopting intelligent automation (IA) to keep abreast of customer and stakeholder expectations – and improve their operations. The complexity of the health insurance industry’s claims process makes it a perfect candidate for IA supported improvements.
Vibushan Lakshminarayan (pictured), director & practice lead, automation & AI for Deloitte, is a speaker at the upcoming 2022 ClaimsTech Summit Australia. He says intelligent document processing (IDP) is crucial for improving the claims process in the health insurance space.
“Yes, I’m passionate about it,” he said.
The ClaimsTech summit is the country’s leading ClaimsTech event putting the spotlight on the latest challenges in the sector. The summit also focuses on innovations and tech tools that can streamline claims handling, facilitate more effective communication with customers and achieve operational efficiencies.
“What IDP does is combine OCR (optical character recognition) with additional machine learning algorithms that have a lot of advanced features and functionalities to extract data with up to 99.9% accuracy - which OCR has traditionally not been able to do,” he explained.
Lakshminarayan said the claims area in the health insurance sector is still a relatively traditional space where paper plays a surprisingly prominent role.
“For more than 40 years people have been saying that paper is going to vanish, however the market still hasn’t gone paperless. So what we would like to do is support the digital transformation with IDP because IDP actually augments the digital journey and it helps in getting to that stage a little quicker while delivering benefits of productivity and efficiency,” he said.
Lakshminarayan said implementing IDP in the health insurance space would help solve one of the primary challenges confronting customers.
“To self-serve, customers need to lodge a claim through a portal by entering data from the invoice for processing. This can be simplified and automated through IDP to help contribute to a positive customer experience,” he said.
Lakshminarayan said medical service providers have practice management software generating invoices that go to the health insurer to be processed.
“But what happens is medical service providers have their own version of the invoices with their own formats and the way they send this data is highly unstructured and not standardized. Traditionally, big paper-based batches are scanned and sent for processing,” he said.
It’s the health insurer’s end of the claims process where he said there is a “sweet spot” for updating the whole claims process with the help of IDP.
“That is where such technology can help health insurance providers optimize this whole process through classification, extraction and automation of the processing without much disruption to their network,” he said.
“For the health insurance providers, the bigger their network, the better for them,” he added.
Lakshminarayan said once a health insurer adopts IDP, it would help their digital transformation process too.
“Once you’re able to do your IDP and extract all this data properly you can fast track your digital journey because you’re digitizing at a rate that is faster while actually giving a positive experience to both customers and medical service providers alike,” he said.
Lakshminarayan said to enable complete digitisation the processing methods must first be standardized end to end.
“That means the incoming data formats would also need to be standardized,” he said.
The Deloitte IA expert added that apart from enabling a digital journey, adopting IDP will help with standardisation, productivity, efficiency and improve the employee experience by enabling them to focus on less robotic and more knowledge-based work.
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The first area that could be tackled in the health insurance space is the variety of invoices.
“So what happens is a machine learning AI (artificial intelligence) augmented approach essentially can process these invoices based on certain keywords, the placement of these keywords and the line items and then corelate them to understand the invoice as a whole,” he said.
“Most importantly, if the ‘machine’ is not confident in its extraction, it is carefully highlighted for supervision by a claims expert to avoid incorrect processing. This level of sophistication is quite advanced,” he added.
Lakshminarayan said the accuracy of AI-led IDP platforms is high - provided the right configurations are used.
“The accuracy of data extraction can range as high as 96% to 100% in some cases. That will help open up a world of opportunities on the downstream processing side, like decisioning and advanced analytics,” he said.
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Lakshminarayan said the medical space is quite different to other sectors, which makes it a unique challenge. However, one challenge they often share is increasing pressure on a limited number of staff to process mounting numbers of claims.
“Given the pandemic a lot of these document processing activities have been impacted because there are not enough people and contact centres have been inundated with calls,” he said.
Many insurance sectors could be suitable candidates for IDP.
The 2022 ClaimsTech Summit Australia will take place at the Swissotel Sydney on March 03. The event will unite Australia’s top insurance companies and feature panel discussions, case studies and presentations addressing the most pressing issues in claims, with the goal of promoting innovation and adapting to the changing business environment. You can register here.