Viewpoint: Your Adjusters Are Drowning in Virtual Paper

Claim adjusters have a difficult job. They are responsible for dispersing funds that comprise the largest category of outgoing cash an insurance company has. Every decision they make about which expenses to approve or decline affects the bottom line. But they also affect the care and well-being of the injured party. These critical decisions can’t be labored because adjusters are measured like factory workers. How many claims are they closing each week? How do their paid losses compare to other adjusters working on similar claims? Oh, and are the claimants happy with the company’s service? They have these pressures to manage for not just a handful of claims but upwards of 200 at a time in extreme cases.

Imagine doing this job in the era of paper documents. Documents about a claim are kept in a claim “file.” In the paper era, a complex and lengthy claim might consist of five or six 2-inch folders stuffed with 500 pages each. That’s up to 3,000 pieces of paper to organize, track, store, evaluate, analyze and recall when needed. As you might imagine, not all adjusters keep pristine claim files, adding time and cost to remembering important details when required.

This recall is vital when reacting to new information in the claim’s life cycle. Better decisions depend on associating further information with what has transpired to date. With so many open claims on the adjuster’s desk, depending on his memory or cryptic notes of the claim details is a poor way to know how the new information relates to past events, treatments, correspondence and other information. And these relationships are critical to understanding if a claim is proceeding as expected or if a new course of action is required.

Furthermore, when a claim moves from one adjuster to another (a common occurrence), the original adjuster might present the inheriting adjuster with a less-than-coherent picture of the claim, its history, and what to expect next if the file is unkempt. The new adjuster often spends days or weeks trying to sort things out. Don’t forget, she has up to 200 other claims to handle.

While moving toward digital claim files has helped with some of these problems, digital documents are mostly just scanned images of paper documents the carrier receives. While scanning removes file folders stuffed full of paper, the adjuster must still read and interpret digital copies manually.

They need to be organized, too, not by the date a document was scanned but, in the case of casualty claims, by the date of service to the injured party. It’s not uncommon for a carrier to receive a bill for services rendered more than 45 days after the procedure is performed. For an adjuster to truly understand the longitudinal activity on the claim, the file must be organized by service dates, not ingestion or “scanned on” dates.

Scanning claims documents addresses an initial essential requirement for digital claims management. But for this information to be usable by a computer, it must be extracted, interpreted, standardized, searchable, sortable and relatable to other information in the claim. This is the actual “heavy lifting” in claims management, which remains mainly in the hands of adjusters. But is this the best approach? Maybe a claim adjuster with 20 years of experience, who keeps orderly files, can perform most of these tasks quickly and efficiently on “run-of-the-mill” claims, but what about the scenario where an entirely new avenue of treatment is presented on a straightforward claim? Will the adjuster recall that on claim XYZ, the injured worker is treated only for a broken arm when a neurologist’s bill shows up? The odds are good that bill will be paid without much scrutiny. And if seasoned adjusters can’t keep up with all the details of all their assigned claims, how can a junior adjuster be expected to?

You’d be correct in saying that they can’t. At least they can’t with any sense of speed, efficiency and proper decisioning.

Fortunately, advanced technologies are starting to significantly improve digital document use during claims adjusting. Scanning technologies are much improved at extracting and standardizing data from static medical claim forms. That technology is finally mature.

But many claims documents are not of the Health Care Finance Administration (HCFA) or state workers’ compensation variety. Many are bills submitted by a medical group and other care providers, and their formats vary considerably from provider to provider. For instance, I mentioned earlier that “date of service” is a critical piece of information for processing claims. That date will appear in a set place on an HCFA or state form. On a medical bill, it could be anywhere, along with many different dates. Scanning alone cannot ensure the proper date, and only the appropriate date is extracted. What’s to be done about this scenario, and how is it the key to unlocking the potential for true digital claims processing?

Enter natural language processing (NLP).

Advances in NLP now allow algorithms and high-speed computers to turn extracted data into searchable, sortable and relatable information. In essence, NLP does the brain work of an adjuster trying to sort out the value of a new piece of information — but in seconds and with perfect recall of the claim’s details. In most cases, NLP has yet to act on its findings; instead, its output is generally presented to an adjuster for him to decide what actions to take. Rather than replacing adjusters, NLP and other forms of artificial intelligence used with it augment the adjuster’s intelligence by performing the rote tasks associated with processing claims.

One way to do this is through technology that automates the ingestion, organization and interpretation of claim documents of all types. From HCFA forms to medical bills, technology can organize claim information, identify, and interpret to alert adjusters of significant new developments. It would act as a virtual assistant and a second set of eyes, operating with perfect and total recall of a claim’s development history.

Claim organizations are increasingly empowered by digital technologies to streamline claims handling and make better decisions. The cost savings, as well as the enrichment of the adjuster’s job, are enormous. This leads to better care for injured parties, faster time-to-closure, happier insureds, and more profitable carriers, which is clearly a winning scenario for everyone.