Verizon, LexisNexis Tackle Health Care Fraud With Predictive-Modeling Apps

Verizon and LexisNexis have showcased software to help the health care industry curb medical claim fraud that costs government and commercial insurers billions of dollars.

Verizon Connected Health Solutions and LexisNexis have demonstrated software platforms to help government agencies and commercial health care organizations use data-analysis techniques to uncover medical claim fraud.

Both companies displayed their anti-fraud products at the National Health Care Anti-Fraud Association (NHCAA) Institute's Annual Training Conference in Atlanta, which runs from Nov. 15-18.

Verizon Fraud Management for Healthcare uses predictive-modeling algorithms to identify potentially fraudulent claims in real time and send them to case managers to be screened, Verizon reports. Connected Health Solutions is Verizon's subsidiary that offers IT and consulting services for the health care industry.

As in financial services and telecommunications, predictive modeling involves advanced algorithms and analytics. Companies can analyze health care claims and transactions to screen large amounts of data in real time for fraud, according to Verizon.

Meanwhile, LexisNexis Risk Solutions, a division of publisher Reed Elsevier, demonstrated its Social Network Analytics software, which the company launched in 2010.

With Social Network Analytics, health care organizations can use predictive analytics to uncover hidden relationships in the claims process among medical providers and other entities to stop unlawful payments, according to LexisNexis.

"Social Network Analytics represents the latest frontier in technology solutions that enable members of the health care industry to identify and prevent fraud, waste and abuse," Bill Fox, senior director for health care at LexisNexis, said in a statement.

"Finding organized, collusive health care fraud is critical to stemming health care fraud and protecting consumers, medical providers and government and commercial payers," he added.

Fraud adds $260 billion, or 10 percent, to expenditures in health care per year in the United States, according to 2009 U.S. Department of Health and Human Services statistics.

Verizon Fraud Management for Healthcare, launched Nov. 16, relies on patented algorithms to find anomalous data patterns in transactions. Features include a risk-scoring module, real-time continuous monitoring and data integration with a health care organization's IT systems.

"Predictive modeling in real time can stop the payment from being made," Connie Scheyen, managing principal for Verizon Connected Health Solutions, told eWEEK.

Suspicious incidents include claims for treatment not medically necessary, stolen identities and falsified billings, Verizon reports.

Algorithms could detect when a doctor bills for extra patients than they'd normally see-such as 100 a day, Scheyen explained. Other warning signs would be several health care providers in one area seeing a patient on the same day, Scheyen said.

The software's geomapping features can even spot false storefronts of pharmacies or health care establishments.

Fraud Management for Health Care is highly scalable, meaning it can adapt to any type of health care organization, Scheyen said.

It provides an alternative to the usual "pay and chase" process, in which payers make payments and then need to recover the funds later, Scheyen explained. "What Verizon brings is prepayment intervention capability," she noted.

Medical equipment purchases account for 30 percent of health care fraud, according to Scheyen.