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Using Database Mining Techniques to Detect Fraud Within Health Care Insurance Databases

Award Information
Agency: Department of Defense
Branch: Defense Advanced Research Projects Agency
Contract: N/A
Agency Tracking Number: 26690
Amount: $100,000.00
Phase: Phase I
Program: SBIR
Solicitation Topic Code: N/A
Solicitation Number: N/A
Solicitation Year: N/A
Award Year: 1994
Award Start Date (Proposal Award Date): N/A
Award End Date (Contract End Date): N/A
Small Business Information
10455 White Granite Drive, Suite 200
Oakton, VA 22124
United States
HUBZone Owned: No
Woman Owned: No
Socially and Economically Disadvantaged: No
Principal Investigator
 Lisa Sokol
 (703) 218-0325
Business Contact
Phone: () -
Research Institution

The GAO has reported to Congress that the loss due to fraudulent health care activity amounted to an estimated $84 billion in 1992. The ability to detect fraud and abuse is critical to the reduction of health care costs. The claims processing system will soon undergo rapid change with the introduction of rapid payment transaction processing systems. The emphasis on rapid turn around combined with increases in data volume will exacerbate the fraud and abuse detection problem. We propose to prove the feasibility of an automated high speed, pre-pay system for processing claims data to detect instances and patters of fraud and abuse. MRJ developed this technology for classified specail-access projects within the Department of Defense, the Intelligence Community, the Department of Justice, as well as within Department of the Treasury. MRJ has demonstrated the potential of using prallel processing for very high speed analysis of patterns of abuse to the law enforcement community. We will develop the system using knowledge mined from historical claims databases and test its heuristics on actual claims data. Blue Cross/Blue Shield of South Caroline (BCBSSC) has expressed interest (Appendix I) and will provide access to its experts and data. Anticipated Benefits: The goal of the project will be to demonstrate the technical feasibility of an automated high speed near real time, pre-pay system for processing helath care claims data to detect instances and patterns of potential fraud and abuse. The fraud detection technology will also lend itself to other types of fraud -- auto insurance, life insurace, phone fraud, mail fraud, etc.

* Information listed above is at the time of submission. *

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