AI-powered DRG auditing solution drives transformative results
A leading managed healthcare company faced inefficiencies with their review and evaluation of hospital bills for inpatient stays, a meticulous process that ensures the diagnosis-related group (DRG) assigned for billing and reimbursement is correct. During this process, auditors verify that the patient's primary/secondary diagnoses, procedures, and discharge status are accurately coded and documented, which is crucial for healthcare providers to receive appropriate payment. This requires skilled auditors, nurses, doctors, and clinicians to review vast amounts of unstructured medical records, often exceeding 2,500 pages per case. These records, in formats like PDFs, JPEGs, and PNGs, must be carefully analyzed to detect billing discrepancies and validate claims.
The manual process was fraught with inefficiencies and risks:
Time-consuming tasks: Auditors spent an average of 45 minutes per case manually sifting through documents to extract relevant clinical facts and reach conclusions.
Operational inefficiencies: A manual approach led to higher costs, limited scalability, and increased risk of revenue loss.
Human errors: Fragmented processes caused inconsistent outcomes, while auditor fatigue and burnout further exacerbated the problem.
Steep learning curve: New auditors faced significant onboarding challenges, slowing down savings capture and reducing overall efficiency.
The result was an error-prone, financially risky system that left payers vulnerable to missed opportunities and compliance gaps. A comprehensive digital solution was urgently needed to streamline the audit process, reduce manual tasks, and enhance scalability.
Solution
EXL, in partnership with AWS, developed a scalable, cloud-native natural language processing (NLP) solution to transform unstructured clinical data into a searchable, indexed format. This innovative platform introduced several key features to revolutionize the auditing process:
- Smart search capabilities: Auditors could instantly locate relevant documentation using smart keyword suggestions and match highlights, significantly reducing search time.
- Guided audit path: An in-house trained model presented decision-based questions linked to multiple evidence points, enabling logical, easier workflows for claim validation.
- Unified audit summary: Consolidated notes, evidence, and references into a single summary, eliminating the need for system toggling and delivering findings in client-preferred formats.
- Centralized audit wiki: Provided real-time access to guidelines, client instructions, and regulatory updates, ensuring auditors have the latest information at their fingertips.
- Impact reporting: Delivered visibility into savings, outcomes, and compliance metrics, enabling data-driven decisions.
- Continuous improvement: An embedded feedback loop refined NLP performance with every audit, ensuring the platform evolved to meet changing needs. This end-to-end solution enhanced accuracy, efficiency, and transparency, redefining the audit experience for all stakeholders.
Outcome
The deployment of EXL's AI-powered audit platform delivered transformative results for our client, including:
Reduced search time: Medical record search time was cut by up to 95%, allowing auditors to focus on higher-value tasks.
Improved auditor efficiency: Intuitive search capabilities and knowledge graphs reduced the learning curve for new auditors, while experienced auditors achieved greater accuracy and reduced audit duration by 10%.
Increased productivity: Audit capacity doubled using the existing staff, boosting productivity by 100%.
Faster claim resolution: Standardized letter drafting reduced post-audit correspondence time by 20%, expediting claim resolution and cash realization.
Enhanced ROI: By enhancing operational efficiencies and targeting high-risk providers, the solution uncovered $16 million in overpayments and improved medical record receipt rates from 65% to 78% within 12 months.
Rapid deployment: The modular design enabled quick implementation and fast ROI, accelerating evidence localization across 1,000-page documents.
EXL's innovative, AI-powered DRG auditing platform has set a new standard for efficiency, accuracy, and scalability in the healthcare industry. By leveraging advanced analytics, NLP, and cloud-native technologies, EXL transformed a traditionally manual and error-prone process into a streamlined, high-performing system. The result is a win-win for all stakeholders—auditors, payers, and providers—delivering significant cost savings, improved compliance, and enhanced operational efficiency.