An aging population, lifestyle related risk factors such as diet, sedentary nature of work, increasing share of chronic illness; climate change, exponential technological advances (new medical equipment, drugs, personalized care) and wider access to care are all factors that contribute to the rising cost of healthcare. Fraud, waste and abuse (FWA) is one component that adds to these costs.

By definition FWA refers to the overutilization of services, or other practices that directly or indirectly result in unnecessary costs. Generally, waste is not considered caused by negligent actions, but rather, misuse of resources. Therefore it would be prudent to assume that all measures taken to reduce the overall cost would reflect on the control and containment of FWA too. With regard to FWA, the most witnessed in the industry, in my opinion, is overutilization. This englobes all involved parties, even members that might expect extra benefits or services from a provider simply because they believe they are entitled to it.

Overutilization contributes to the cost and should be addressed to reduce its impact. The answer to this conundrum is, indeed, digitization. We have to accept the fact that the world is changing fast and we as humans as well as the insurance industry should cope, adapt and benefit. Technology is evolving so fast that we see old generations are living long enough to witness the revolution in our technological world and embracing them too. While the healthcare industry historically has been slower in terms of digital disruption in comparison with other sectors, in some quarters we are witnessing progress. Data can be a double-edged sword. One may derive meaningful information or be lost in myriads of data. From a TPA’s perspective, digitization in order to manage claims makes absolute sense. The more we digitize, the more we are able to enhance our capabilities by introducing rules and edits into an automated, logic driven claims management system that takes seconds to process a claim. Data has to be analyzed and fed into these systems to generate an evolving, dynamic environment, proving to be a treasure trove of utilization trends and other insights on the member, provider and physician levels. This is where we engage with providers as partners to make them aware and conscious of cost. Providers should be looking for ways to differentiate themselves by controlling overutilization and focusing on quality and value to increase patients’ footfall and retain revenue.

With such digital systems it is now possible to map the typical journey of an insured member availing treatment in a seamless environment and devise tools that will positively impact the insured. Artificial intelligence or machine learning edits and enables adjudication, therefore allows better outcome at a faster turnaround time and lower cost. Digitization is not unique as a vision. What differentiates between companies is how they put it to action. And to have the action in the right direction, there should be a favorable ecosystem to foster and put this change in motion; » Stakeholders: It’s not enough for only some parties to be involved in the process. Government, regulators, medical providers, insurance companies need to be part of it. The e-claims system and nation-wide electronic medical record are all steps in the right direction. » E-health agenda: An e-health agenda must include appropriate technical infrastructure and technical interfaces for all stakeholders, e-processes to ease the journey and manage costs i.e. e-claims, e-prescription, e-billing, digital tools to empower people to look after their health, patient-accessible electronic health records for all clinical information. For instance, in the recent outbreak of the COVID-19, our members availed our teleconsultation service through MyNextcare Mobile App. This is a way to keep our members safe with accessible e-health, especially in such circumstances. »

Preventative care: Empowering people to take actions to prevent health events before they occur i.e. genetic screening, wellbeing programs, regular checkups, disease screening, and embracing healthy lifestyles. » Digital transformation: Digital transformation is a mindset to drive the vision of an integrated e-health ecosystem. Ultimately, the end goal of all these endeavors is a larger vision, namely, value-based healthcare. In the near future, a far more sustainable model, based on the quality and outcome of the treatment, would replace the fee-for-service model. The journey started with bundled pricing, Diagnosis Related Group (DRG), and Electronic Health Records (EHR), which are being introduced as important milestones in this direction.

Written by Jihad Francis (Published in Premium Magazine, April 2020).