Knowledge Objects Rodney Boyd AHIA Claims Leakage & Fraud Forum August 2007 Rodney Boyd Managing Director Knowledge Objects Healthcare Australia Pty Ltd Level 2, 10-14 Bulletin Place Sydney NSW 2000 Australia Telephone (02) 8213 3579 www.KnowledgeObjects.com.au

Today’s Agenda About our company Claims leakage: common problems About our services & software Common findings 24 months… key learnings A vision of the future Copyright 2006 Knowledge Objects Healthcare Australia Pty Ltd

About Knowledge Objects Established in 1996 15 health funds – Asia, Africa, Australia In Australia for two years Mission = help PHI funds stop claims leakage Part of the Bathabile Group

About Bathabile Technology & health insurance risk management 14 companies 5 countries, 4 continents Clients = health insurers, managed care organisations, government departments

Common Failings… Worldwide IT systems built for transaction processing Rules are hard coded Limited specialist focus on leakage The business can’t manage the process The fund can’t afford specialist clinical expertise

About KnowledgePower™ Proprietary developed claim rules engine Supplement existing technology Increase automation Stop the claim before payment - be proactive, not retrospective Let the business define & manage the rules - without IT involvement

About KnowledgePower™ (continued) Provide a “process” and tools required to implement a rules based claims leakage programme Store “knowledge” in a central repository Measure and report

KnowledgePower Rule Types Claim Padding / Card Farming Limit Surfing / Provider Collusion Smart Duplicates / Over Servicing Erroneous hospital claims Provider / Member / User alerts & tracking Plus… product rules, membership rules, customer retention etc… if you have the data then KnowledgePower can build the rule

How to use KnowledgePower Health fund philosophy to claims leakage established Data mining & retrospective analysis KnowledgePower Write rule Test within KnowledgePower Adjust rule Generate within Test environment Test rule Fund sign-off Generate within Production environment Investigate and action

How KnowledgePower Works Claims Claims Assessing Process Branch Paper Hicaps EDI Manual Capture Web interface Eclipse Thelma Administration System Payment Business Business Business Process Process Process One Two Three Reject Reject Reject

How KnowledgePower Works KnowledgePowerTM Automated Code Generation Claims Claims Assessing Process KnowledgePower Branch Paper Hicaps EDI Manual Capture Web interface Eclipse Thelma Administration System Machine Code Payment Business Business Business Calling Process Process Process Program One Two Three Reject Reject Reject KP: Reject / Refer / Tag

How KnowledgePower Works Health Fund Rule Managers Knowledge Objects Fraud Ancillary Hospital Medical Knowledge Objects Rule Engineer KnowledgePowerTM Automated Code Generation Claims Claims Assessing Process KnowledgePower Branch Paper Hicaps EDI Manual Capture Web interface Eclipse Thelma Administration System Machine Code Payment Business Business Business Calling Process Process Process Program One Two Three Reject Reject Reject KP: Reject / Refer / Tag

How KnowledgePower Works Health Fund Rule Managers Knowledge Objects Fraud Ancillary Hospital Medical Knowledge Objects Rule Engineer KnowledgePowerTM ClaimsExpress Automated Code Generation Fund Claims Adjudicator Claims Claims Assessing Process Claims scored: Reject / Pay / Investigate KnowledgePower Branch Paper Hicaps EDI Manual Capture Web interface Eclipse Thelma Administration System Machine Code Payment Business Business Business Calling Process Process Process Program One Two Three Reject Reject Reject Recover KP: Reject / Refer / Tag

How KnowledgePower Works

How KnowledgePower Works

How KnowledgePower Works

How KnowledgePower Works A B C

How KnowledgePower Works C B A

How KnowledgePower Works

How KnowledgePower Works A B C

Common Firings Mismatches between hospital & medical claims Prothesis & materials not accompanied by procedures Dental rules relating to age restrictions Dental rules not following ADA guidelines Excessive ancillary claiming patterns Conflicting MBS charges Excessive LOS for procedures

After 24 Months… Key Learnings Rule management requires commitment The philosophy of leakage management requires top management buy in, it’s an EXCO level discussion as it requires trade offs A natural tension exists between leakage minimisation and other divisions of the fund eg claims assessing, provider relations. A balance is required which requires high level management intervention

After 24 Months… Key Learnings The process of managing rules is as important as the rules themselves Resources are always limited so focus is imperative Set a strategy for rule development and follow it Intellect beats man power – but both are better 30 more minutes of structured testing can save days of wasted effort

After 24 Months… Key Learnings Lack of data = disempowerment Consistency in claims assessing processes is vital for rules to work Reporting and definitions are crucial

A Vision A greater focus on claims leakage in the board rooms of PHI funds in Australia A greater willingness to accept that as key funder of healthcare in Aus the PHI industry has a right and responsibility to manage claims leakage for the benefit of all members Increased collaboration: a common industry set of rules, augmented by individual fund rule sets More clinical based rules to monitor appropriateness of care A common panel of industry accepted clinical experts Every fund using KnowledgePower!

Thank You!