AI and health insurance: a new day of opportunities

Setting the scene

The promise of artificial intelligence is the brightest thread in the complex web of modern innovations. It tells a story about a world where data-driven algorithms not only help people make choices, but also change whole industries. On the edge of this change is the health insurance business, which is ripe for change. When generative AI and health insurance work together, it's not just about making things easier or faster. It's also about reimagining what's possible, putting the person at the centre of every action, and making every policy a personal promise. Let us look at what the future could hold (in some cases the future is here)

We focus on the touchpoints for the customer based on the various life stages that they are in and how they experience their Insurance and Health requirements and interactions based on these stages.

1. The First Predictors: Predictive Analytics and Risk Assessment

In the past, health insurance risk assessment was based on averages and generalisations that didn't always take into account how genes, the environment, and personal choices interact. Generative AI, especially with the power of GPT-4's computers, wants to change this. Because it can handle and combine a huge amount of data, it can make highly personalised predictive models.

The connection between an insurer and a client is changing, because of how well risk profiling is getting. Policyholders are no longer seen as just numbers, but as people with unique stories and different health paths. This is important because insurance can make their services more sympathetic if they understand these stories. Also, as AI improves, its predictions could possibly help people make healthier lifestyle choices and through guided nudges we can drive these new choices to become a habit. 

This would create a positive feedback loop in which both insurers and insureds gain from healthier outcomes.

2. The Guided Transformation: Making It Easier to Handle Claims

The insurance claim is often feared because it is hard to understand and could take a long time. The goal of generative AI is to completely change this way of thinking. With GPT-4's ability to process natural language, even complicated medical papers can be looked at quickly and accurately. It makes a huge difference in how well things work, for example the case study of Lemonade.

Prior authorisation, a complex and time-consuming process, is ripe for AI-driven transformation. AI and machine learning enable the aggregation of diverse datasets, streamlining tedious manual tasks, and facilitating smoother workflows. By automating the assessment of whether prior authorisation is necessary for specific treatments and efficiently identifying the associated documentation requirements, AI mitigates the burden on healthcare providers and enhances overall operational efficiency. This advancement is crucial given that prior authorization is a cost-intensive transaction, often necessitating communication between providers, staff, and insurers, and is known to be one of the most cumbersome processes for providers to handle manually.

Claims management, a critical aspect of healthcare insurance, is benefiting from the integration of AI and robotic process automation (RPA). Inefficiencies in claims processing, often resulting in costly errors, can be mitigated through AI-enhanced RPA platforms. These platforms, by mimicking human processes and leveraging AI capabilities, can identify bottlenecks and suggest more efficient workflows. The use of AI in claims management has the potential to dramatically reduce denial rates, improve revenue cycle management, and enhance overall operational efficiency. For example, startups like Olive have demonstrated substantial reductions in accounts receivable days and the processing of thousands of claims in a single week through their AI-powered RPA platforms. Additionally, AI systems are emerging to predict claim rejection, providing providers with valuable insights to optimize their claim submissions and improve revenue collection.

But the real magic is when economy and objectivity come together. With AI in charge, the whole claims process is standardised, which makes sure that each client gets a fair evaluation. Also, this change isn't just happening with claim handling. It opens the door for proactive claim interventions, in which AI can find possible problems and fix them before they get worse, making the customer experience even better, through the advancement of straight through claims processing.

3. The Enlightened Educators: Customised Education and Outreach

The days of one-size-fits-all dialogue are coming to an end. In its place will come a time of very personalised marketing, made possible by AI's deep understanding of each person's character. With its ability to generate messages, GPT-4 makes sure that each person gets a message that speaks to their unique health concerns, lifestyle choices, and even personal preferences.

This change in how people communicate isn't just about getting people interested; it's also about giving people more power - putting the data into the hands of the consumer.

With personalised information, consumers can make smart choices about their health, giving them a sense of control and a sense of working together with their insurance companies. Over time, as the feedback loop gets tighter and AI keeps learning and improving its messages, we may see a paradigm shift in which insurers go from being service providers to being trusted health partners.

4. The Empathetic Engineers: New Ways to Find Fraud

Every business has its share of wrongdoing, and health insurance is no different. False claims have been a problem for a long time, draining resources and making insurance rates go up for real customers. Enter AI, which can recognise patterns better than any other technology. GPT-4 can sort through huge amounts of data and find oddities and errors with a level of accuracy that is just not possible for humans.

But there are deeper and more important effects than just the instant financial ones. By stopping fraud, insurance companies can give more affordable premiums and keep health insurance available to a larger number of people. In a world where healthcare costs are going up, this could be a big step towards making sure healthcare stays a right and not a luxury.

5. The Agile Architects: Designing Customised Policies

Static insurance plans that can't be changed are on their way out. With GPT-4, insurance companies can now make plans that are alive and change as a person's life does. Every health milestone and change in living can be taken into account by these flexible policies, making sure they are always useful.

This kind of change gives insurance companies a unique look at the market. By keeping an eye on policy changes and changes in real time, they can predict market trends, come up with new products, and stay ahead of the game. It's a brave new world where agility not only drives market success, but also defines it.

When we look into the future, the way AI and health insurance work together shows us hope, creativity, and deep personalisation. But as we go down this road, it's important to find a balance and make sure that technology, no matter how advanced, always serves humanity's core needs and values. With careful application and a focus on the individual, we are on the verge of a time when health insurance isn't just a legal requirement but also a personal, empowering, and life-changing journey.

6. The Handwriting TA: Transforming Medical Coding

An essential but error-prone component of healthcare billing, is another area undergoing a significant transformation. Natural language processing (NLP) technologies are poised to disrupt the $25 billion medical coding market by automating the conversion of clinical notes into universally recognized codes. Collaborating with human coders, NLP-powered software offers a more accurate and efficient approach, reducing errors and enhancing productivity. Big tech players like Amazon are entering this space with healthcare-focused NLP services, further emphasizing the potential of AI in revolutionizing medical coding. Moreover, historical data suggests that AI solutions can significantly enhance medical billing revenue while boosting coder productivity, making them indispensable in the evolving healthcare landscape.

7. The Intelligent Underwriter: Smart Products

When we consider all the factors discussed above, it becomes evident that there exists an exceptional opportunity within the realm of Health Insurance. Actuaries, armed with the wealth of data at their disposal, are poised to revolutionise the industry by crafting products that are intricately attuned to the specific needs and requirements of each customer, taking into account their unique life stages.

This transformation centres on placing the customer at the heart of the insurance experience, granting them the autonomy to select only those options that align with their individual circumstances and preferences. This not only empowers the customer but also ensures that the insurance they receive is truly personalised and relevant to their lives.

Final thoughts

The synergy between AI and health insurance paints a promising picture - one of hope, ingenuity, and profound personalisation. As we venture into this brave new world, it's pivotal to ensure technology remains anchored to humanity's core values and needs. We're not just looking at health insurance as a contractual obligation but as a deeply personal, empowering, and transformative journey.