FWA solutions to Reduce Revenue Losses for Payers

Fraud, waste, and abuse (FWA) in healthcare is a widespread problem in the United States. The Office of Inspector General (OIG) at the Department of Health and Human Services (DHHS) estimates that FWA costs the healthcare system will reach upto 27% of the total Healthcare spending. In its report, “Fighting Fraud, Waste, and Abuse in the Healthcare System,” DHHS outlined the following types of FWA:

Fraud: The intentional deception or misrepresentation of facts to obtain something of value. This includes billing for services not rendered, providing unnecessary services, and billing for services at inflated prices.

Waste: The misuse or misapplication of resources. This includes using too much medication, overprescribing antibiotics, and wasting supplies.

Abuse: The improper use of healthcare services or providers. This includes providing unnecessary services, charging for services not rendered, and prescribing medication unnecessarily.

Top 8 reasons for Revenues Losses due to FWA 

Fraudulent billing or services: Payers lose an estimated $2.5 billion each year to fraudulent billing or services. This can include charges for services that were not rendered, incorrect treatments, or upcoming (charging for a more expensive service than was provided).

Improper coding: Incorrectly coding medical procedures can lead to improper payments being made by the payer. This can amount to billions of dollars in losses each year.

Fraudulent claims: False or inflated claims submitted to payers can result in significant losses for them. It is estimated that payers lose $10 billion annually to fraudulent claims.

Unnecessary tests and treatments: Tests and treatments that are not medically necessary can waste valuable resources and drive-up healthcare costs. Payers lose an estimated $17 billion each year due to unnecessary tests and treatments.

Prescription drug leakage: Improperly targeted drugs or incorrect dosage amounts can result in significant losses for payers due to prescription drug leakage.

Duplicate claims: Duplicate claims can also lead to significant revenue losses for payers. If two providers submit duplicate claims for the same service, the payer will have to reimburse both providers for the same service. This can cost the payer a lot of money, and it can also be very time-consuming to investigate and resolve these claims.

Customer Trust: Finally, FWA can also lead to a loss of public trust if it is revealed that the payer has not been processing claims correctly or has been engaging in fraud and abuse. This could lead to patients choosing not to enroll in health plans or seeking care from other providers.

Alternative costs: FWA can also lead to higher administrative costs for payers. This is because payers have to go through the process of reevaluating the claims and correcting the mistakes.

Technologies that can Reduce Revenue Gaps in Payer Network 

Blockchain technology: Blockchain technology can be used to solve FWA related problems for payers. It provides an immutable audit trail of all transactions, which can help payers track and prevent fraud. It also allows for secure and transparent peer-to-peer transactions, which can help payers save money on transaction fees.

Data analytics: Data analytics involves extracting insights from large data sets to help organizations make better decisions. By analyzing data related to healthcare claims, payers can identify patterns of fraud and abuse and take corrective action early on. It can also help detect fraudulent activities in real-time and identify potential areas where savings can be made.

Artificial intelligence (AI): AI emphasizes on the creation of intelligent agents, which are systems that can reason, learn, and act autonomously. AI can help payers to automate the detection of fraudulent activities and train staff members on how to identify fraudulent activities. It can also help manage claims processing workflows more efficiently.

Predictive modeling: Predictive modeling is a method of statistical modeling that uses historical data to predict future events. By using past data about fraudulent claims, payers can develop models that predict which claims are likely to be fraudulent. Predictive modeling can allow for the identification of high-risk claims before they become actual losses. It also helps improve the accuracy of claim adjudication processes.

Billing: The billing process can be complex and time-consuming for payers. Billing software can automate many of the tasks associated with billing, such as generating invoices, tracking payments, and creating reports. This can help reduce administrative costs and improve billing accuracy.

Interoperability: An interoperable payer system can share data and work together seamlessly. Such a system is capable of identifying fraudulent claims coming from any system, therefore, minimizing the cost of rechecks and rectifications.

Mobile Application development: A mobile application will give your customers more access and authority over their encounters. If customers/patients can check their encounters and bills before it reaches the revenue pipeline, it will reduce the risk of duplicate claims and fraudulent billing.


We have a number of solutions to help you reduce your revenue leakages and improve your bottom line. Our experienced team can work with you to identify where your losses are occurring and put in place measures to prevent them. Our healthcare payer solutions have been helping organizations all over the US, for over a decade.

Contact us today for a free consultation to find out how we can help you boost your profits. info@nalashaa.com

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Mitrajit Das

Mitrajit Das

A writer with a keen interest in the Healthcare domain and B2B content marketing. He enjoys writing and creating pieces around the latest Healthcare IT trends using the simplest of words.
Mitrajit Das

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