Anomaly Detection in Health Insurance Claims Using Bayesian Quantile Regression

Ezekiel N. N. Nortey, Reuben Pometsey, Louis Asiedu, Samuel Iddi, Felix O. Mettle and Sergejs Solovjovs

International Journal of Mathematics and Mathematical Sciences, 2021, vol. 2021, 1-11

Abstract: Research has shown that current health expenditure in most countries, especially in sub-Saharan Africa, is inadequate and unsustainable. Yet, fraud, abuse, and waste in health insurance claims by service providers and subscribers threaten the delivery of quality healthcare. It is therefore imperative to analyze health insurance claim data to identify potentially suspicious claims. Typically, anomaly detection can be posited as a classification problem that requires the use of statistical methods such as mixture models and machine learning approaches to classify data points as either normal or anomalous. Additionally, health insurance claim data are mostly associated with problems of sparsity, heteroscedasticity, multicollinearity, and the presence of missing values. The analyses of such data are best addressed by adopting more robust statistical techniques. In this paper, we utilized the Bayesian quantile regression model to establish the relations between claim outcome of interest and subject-level features and further classify claims as either normal or anomalous. An estimated model component is assumed to inherently capture the behaviors of the response variable. A Bayesian mixture model, assuming a normal mixture of two components, is used to label claims as either normal or anomalous. The model was applied to health insurance data captured on 115 people suffering from various cardiovascular diseases across different states in the USA. Results show that 25 out of 115 claims (21.7%) were potentially suspicious. The overall accuracy of the fitted model was assessed to be 92%. Through the methodological approach and empirical application, we demonstrated that the Bayesian quantile regression is a viable model for anomaly detection.

Date: 2021
References: Add references at CitEc
Citations:

Downloads: (external link)
http://downloads.hindawi.com/journals/ijmms/2021/6667671.pdf (application/pdf)
http://downloads.hindawi.com/journals/ijmms/2021/6667671.xml (application/xml)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hin:jijmms:6667671

DOI: 10.1155/2021/6667671

Access Statistics for this article

More articles in International Journal of Mathematics and Mathematical Sciences from Hindawi
Bibliographic data for series maintained by Mohamed Abdelhakeem ().