The $30M that looked like fraud

A health system that also runs an insurance plan was paying out far more than its clinical volume could explain. Leadership assumed fraud. The SQL logs showed a date-format mismatch that made the system pay for the same procedure twice.

Organization
EY, for a health system with its own insurance plan
My role
Staff Technology Consultant, Data and Platform Analysis
When
2021 to 2023
Result
$30M+ in overpayments identified; losses cut 23%

The problem

The client was losing money fast, and leadership assumed fraud. While I was working on speeding up their claims process, I noticed payout volume was well above what the clinical volume could explain. I needed to find where the money was going and prove the cause.

What I did

During the day I was building and running anti-fraud training. At night I dug through the SQL logs. The pattern in the raw records wasn’t fraud. Hospitals were sending claim updates with a date format the payer system didn’t recognize, so it treated each update as a brand new claim and paid for the same procedure twice.

I sized the impact at over $30 million and took it to the C-suite to get the fix funded. We built a layer that recognized the update flag so revised claims stopped paying out as new ones.

Result

Losses dropped 23%, and the C-suite sponsored scaling the fraud detection work.

What I took from it

In automated systems, an efficiency problem can hide a big financial one. The answer was in the raw data, not in the assumption everyone started with.

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