“A STUDY ON FRAUD DETECTION IN HEALTH INSURANCE CLAIM AND ITS

CHALLENGES FACED BY HEALTH INSURANCE AGENCY”

Internship project submitted in partial fulfillment of the requirements for the
award of the Degree of
MASTER OF BUSINESS ADMINISTRATION
OF
BANGALORE UNIVERSITY
By
PREETHI. R
Reg. No: P03DB22M015041
Under the guidance of
Mr. Mohammed Ishaq
Associate Professor
G.T INSTITUTE OF MANAGEMENT STUDIES AND RESEARCH
Sunkadakatte, Magadi Main Road, Bangalore - 560091
Bangalore University
2023-2024
 INTRODUCTION

• Fraud detection refers to the process of monitoring transactions and customer behavior to pinpoint
and fight fraudulent activities. It is usually a central part of a firm's loose prevention strategy and
sometimes forms a part of its wider anti-money laundering (AML) compliance processes.

• When fraud detection and its related functions are integrated into a wider AML framework, the
combination is sometimes referred to as fraud and anti-money laundering (FRAML).

• The consequences of health care fraud are profound, extending beyond financial losses. Fraudulent
activities compromise patient care, erode public trust, and inflate the overall cost of healthcare
services.

• Detecting and preventing fraud in healthcare claims is therefore a critical component in ensuring
the sustainability and effectiveness of healthcare systems globally.

• Fraud detection in healthcare claims is a critical aspect of the health care industry, aiming to
identify and prevent fraudulent activities that may lead to financial losses and compromise the
quality of patient care.
 COMPANY PROFILE

• Carelon Global Solutions, a healthcare services company formerly known as Legato Health Technologies, intends to hire 3,000 people across various levels in 2023. The

company — which began operations in India in 2017 — currently employs more than 18,000 people across Hyderabad, Gurugram, and Bengaluru.

• “Legato has evolved from an outsourcing center to a strategy and innovation hub, delivering whole health for its parent company, Elevance Health. As a new brand,

Carelon’s main objective is to improve the health of the healthcare system,” noted Rajat Puri, COO, Carelon and President, Carelon Global Solutions.

• The transition is designed to transform healthcare operations through digital means and enhance the overall consumer experience, he told business line. Elevance Health

is a health insurance service provider based in the United States, with revenues of $156 billion in 2022.According to the company, a lot of emphasis is put on developing

mobile applications in India. “The main app for our parent companies, such as Sydney Health, and for our members is an app that is developed out of India by Legato/Carelon

Solutions.”

• The transition is designed to transform healthcare operations through digital means and enhance the overall consumer experience, he told business line. Elevance Health

is a health insurance service provider based in the United States, with revenues of $156 billion in 2022.According to the company, a lot of emphasis is put on developing

mobile applications in India. “The main app for our parent companies, such as Sydney Health, and for our members is an app that is developed out of India by Legato/Carelon

Solutions.”
VISION

To be the trusted partner that makes better health possible. We come to work with
bold, big-picture ambitions: to empower a healthcare ecosystem for all.
For us, that means equipping health plans, health systems, employers, life
sciences, government agencies, and developers with premier, digital-first
solutions that make whole health easier to achieve across the health system —
from individuals and clinicians to care advocates and communities.
RESEARCH METHODOLOGY:

STATEMENT OF THE PROBLEM

Fraud detection is a system to rectify the things happened incorrect previously or

current. Fraud detection helps to identify the drawback of fraudulence and take the
corrective measures to avoid the unnecessary risk. The major challenges faced by
Health Insurance agencies by customer who is going to, claim falsely. It creates the
financial losses as well to losing the investment. Most of the time health insurance
agencies fails to identify the fraudulence claims by the customers. It is necessary to
identify the claims of customers are genuine or not. This research is useful to
understand about the fraud detection in health insurance claims.
OBEJECTIVES OF THE STUDY

• To study about fraud detection and its significance in health

insurance claims.

• To know the various challenges faced by health insurance agencies

in fraud detection.

• To understand issue of health insurance claims and its fraudulence

activities

• To identify the measures for an overcome with fraud detection

REVIEW OF LITERATURE

• Health care management science 11, 275-287, (2008): Fraud and abuse have led to
significance additional expense in the health care system of the United States.

• Journal of Health Informatics in Africa 6 (2), 64-73, (2019): This research developed
a Fraud Detection System for National Health Insurance Scheme (NHIS) in Nigeria.

• Journal of Engineering (2019): Fraud in health insurance claims has become a

significant problem whose rampant growth has deeply affected the global delivery of
health services. in addition to financial losses incurred patients who genuinely need
pain because providers are not better because of delays in the manual vetting of
their claims and are therefore unwilling to continue offering their services.
RESEARCH METHOD:

A descriptive and primary survey will be undertaken for the study of

health insurance claims and its challenges faced by health insurance
agencies with reference to Carlene Global Solution.

DATA COLLECTION

PRIMARY DATA:

The primary data will be collected through questionnaire and

interacting with employees of insurance agencies.

SECONDARY DATA:

The secondary data is collected from various sources available within

the organization like various website, articles, journals, magazine and
Company past record, library books, internet, annual reports, and
consulting administration staff from consulting managers.
SAMPLING DESIGN

• Sampling plan

The collection of data will be collected through the employees.

• Sampling method

Simple random method will be undertaken for collection of data from the respondents.

• Sample size/Unit

The sampling size of the respondents is 30.

PLAN OF ANALYSIS

To bring out the results of the study the data presented in the form of graphs, charts and figures with people

analysis and interpretation given for the study.

LIMITATIONS OF THE STUDY

• The study is limited for 4 weeks.

• The study is limited for fraud detection in health insurance claims in Bangalore.

• High premium cost.

• Limited respondents could be contacted because of the time constraints.

CHAPTER SCHEME

CHAPTER-01- INTRODUCTION

CHAPTER-02- COMPANY PROFILE

CHAPTER-03- RESEARCH DESIGN

CHAPTER-04- DATA ANALYSIS AND INTERPRETATION

CHAPTER-05- FINDINGS, CONCLUSION AND SUGGESTIONS

BIBLIOGRAPHY

ANNEXURE
 TABLE NO. 4.13
TABLE SHOWING IF NEW TECHNOLOGY CAN BE USEFUL IN
IDENTIFYING FRAUD

OPTIONS RESPONDENT PERCENTAGE

Yes 23 76.7%

No 7 23.3%

TOTAL 30 100%

ANALYSIS

From the above data it is analyzed that out of 30 employees, there are 23 employees who states yes that is
76.7%, 7 employee who states no that is 23.3, for saying technology can be useful for identifying fraud.
 CHART NO. 4.13

CHART SHOWING IF NEW TECHNOLOGY CAN BE USEFUL IN

IDENTIFYING FRAUD

CAN NEW TECHNOLOGY HELP

FINDING FRAUD
90.00%
80.00%
70.00%
60.00%
50.00%
40.00%
30.00%
20.00%
10.00%
0.00%
0 0.5 1 1.5 2 2.5
CAN NEW TECHNOLOGY HELP FINDING FRAUD

INTERPRETATION
From the above graph it is observed that majority of the employees at Carelon Global Solution
states YES and 2nd most states NO for identifying fraud using new technology.
TABLE NO. 4.14

TABLE SHOWING WHAT RESOURCES THEY USE TO IDENTIFY HEALTH

INSURANCE FRAUD
OPTIONS RESPONDENT PERCENTGE

News 7 23.3%

Articles 10 33.3%

Government 11 36.7%
Websites
Industry Report 2 6.7%

TOTAL 30 100%

ANALYSIS

From the above data it is analyzed that out of 30 employees, there are 7 employees who states news that is 23.3%, 10
employee states articles that is 33.3%, 11 employee who states government websites that is 36.7%, 2 employees who states
industry report that is 6.7%.
CHART NO. 4.14

CHART SHOWING WHAT RESOURCES THEY USE TO IDENTIFY

HEALTH INSURANCE FRAUD
RESOURCE TO IDENTIDY FRAUD
40.00%
36.70%
35.00%
33.30%
30.00%

25.00%
23.30%
20.00%

15.00%

10.00%
6.70%
5.00%

0.00%
0 0.5 1 1.5 2 2.5 3 3.5 4 4.5

RESOURCE TO IDENTIDY FRAUD

INTERPRETATION

From the above graph it is observed that majority of the employees at Carelon Global Solution states articles and 2nd most is
government websites as the resources for identifying fraud.
FINDINGS

• Majority of employees belong to the employed of Carelon global solution,

followed by healthcare professionals and insurance company personnel,
indicating a diverse workforce.

• While a significant proportion of respondents have not filed health insurance

claims, awareness about health insurance and concerns about fraud are
prevalent among the workforces.

• Employees express varying levels of confidence in identifying health

insurance fraud, with many considering new technology as a useful tool for
detection.

• Lack of awareness and technology limitations are perceived as significant

challenges in detecting health insurance fraud.

• Despite witnessing instances of fraud, a considerable number of employees

have not reported them, highlighting potential gaps in reporting mechanisms.
SUGGESTIONS
• Implement comprehensive training programs for employees to improve
awareness of health insurance concepts and fraud detection techniques.

• Allocate resources towards adopting advanced technologies such as data

analytics and machine learning algorithms to bolster fraud detection
capabilities.

• Establish clear and accessible channels for employees to report instances of

fraud confidentially. Implement a robust whistleblowing policy to encourage and
protect employees who come forward with information about fraudulent
activities.

• Ensure compliance with stringent regulations governing the healthcare and

insurance sectors. Regularly update policies and procedures to align with
changing regulatory requirements and industry standards.

• Foster collaboration between different departments within the organization, as

well as with external stakeholders such as government agencies and industry
associations.
CONCLUSION

In conclusion, the findings from the analysis underscore the importance of

proactive measures in addressing health insurance fraud within Carelon Global
Solution. By implementing a comprehensive strategy that includes enhanced
training programs, investment in technology, streamlined reporting
mechanisms, and regulatory compliance, the organization can significantly
improve its fraud detection and prevention capabilities. Additionally, fostering
interdepartmental collaboration, maintaining continuous education and
awareness initiatives, and prioritizing data security are crucial steps towards
creating a robust anti-fraud environment.

Furthermore, establishing partnerships with government agencies and

prioritizing continuous improvement will ensure that Carelon Global Solution
remains vigilant and adaptable in the face of evolving fraud threats. By
embracing these recommendations, the organization can safeguard its financial
resources, protect its reputation, and uphold the trust of its stakeholders.
Ultimately, a proactive approach to combating health insurance fraud will
contribute to the long-term sustainability and success of Carelon Global
Solution in the healthcare industry.
BIBLIOGRAPHY

1. Smith, J. (2008). Health Insurance Fraud: Detection and Prevention

Strategies. Publisher.

2. Aspen Health Law Center · (1998) · The HHS, DOJ, state Medicaid Fraud
Control Units, even the FBI is on the case.

3. Johnson, A., & Brown, C. (2019). "Challenges in Health Insurance Fraud

Detection: A Case Study Analysis." Journal of Insurance Research, Volume
(Issue), Page range

4. D’Amour, Alexander, et al. "Fraud detection in healthcare: a survey."

Artificial Intelligence in Medicine 82 (2017): 1-24.

5. Sadeghi, Mohammad Reza, et al. "A comprehensive review on healthcare

fraud: methods and approaches." Journal of Medical Systems 42.8 (2018):
140.
Thank you