Understanding The Role of AI In Health Insurance
Artificial Intelligence (AI) is a disruptive technology that has a universal impact, fundamentally changing and transforming every aspect of various sectors and industries.
The healthcare and insurance industry, in particular, has seen a major change in regard to adopting Artificial Intelligence, enhancing operational accuracy and customer experience while reducing time and cost.
The global AI healthcare market is expected to be worth around $188 billion by 2030, growing at a Compound Annual Growth Rate (CAGR) of 37% from 2022, when the market was worth $11 billion.
In the healthcare sector, AI has particularly benefited and transformed the health insurance sector, automating repetitive tasks, improving predictions and recommendations, and streamlining customer service.
This article explores the role, impact, benefits, and future of AI in health insurance. Let's get right in!
What is Artificial Intelligence in Healthcare?
Artificial Intelligence (AI) in healthcare involves performing several medical-related tasks and operations using computational technologies, such as machine learning algorithms, much more accurately and quickly.
It involves using tools to enhance treatment planning, prediction and diagnosis of injuries and illnesses, and healthcare management, ensuring the right treatment is given to the patient.
AI in healthcare consists of a vast range of applications, including diagnostics, medical imaging, drug discovery, predictive analysis, and personalized treatment planning.
This significantly reduces the time and effort required to diagnose illnesses and find errors, thereby cutting down on cost and time.
How Does AI Play a Role in Health Insurance?
Health insurance is one of the most critical policies in India in which the company or insurance provider covers some amount of cost from the patient's treatment or medical bill.
The health insurance market is anticipated to grow at a tremendous rate in the coming years. In fact, statistics suggest that the health insurance market size is predicted to reach $89.45 billion by 2024.
The major contributing factor towards this shift is not only the realization of the growing importance of health insurance amongst people but also the role AI plays in the digitization of the health insurance experience, making it much more efficient, accessible, instant, and accurate.
Here are the multiple roles AI plays in the health insurance sector.
1. Faster claim settlement
One of the biggest challenges for insurance seekers and providers is the lengthy manual processes of claim settlement or fraudulent claims.
While identifying genuine claims manually can be daunting, automated claim settlement processes significantly reduce the claims' turnaround time, processing claims much faster and more accurately.
Furthermore, AI also helps detect fraudulent activities and minimize financial losses for insurers.
2. Use of chatbots
Chatbots are one of the most leveraged AI technologies for several sectors, including the healthcare sector, particularly used to enhance and improve customer service.
AI-powered chatbots can efficiently handle customer service, reducing waiting times, offering claim assistance, streamlining claim assistance through detailed and educational documentation, and enabling quicker query resolution—enhancing customer experience.
3. Customer health insurance policies and personalized recommendations
AI algorithms analyze vast customer data and patterns and behavior to offer personalized and tailored health insurance policy options.
For instance, the algorithms try to understand the users' health needs and requirements, preferences, and budgets to recommend suitable coverage options and insurance policies. This enhances the users' overall experience and makes it convenient to purchase tailored insurance policies based on their specific needs and budget requirements.
4. Fraud detection
AI-powered systems and algorithms analyze claims data, patient histories, and providers' billing practices to identify suspicious patterns and anomalies, detect fraudulent activities, and minimize losses.
5. Cost-efficient
AI in Health insurance helps to streamline processes and make data-driven decisions, optimizing costs throughout the insurance lifecycle.
AI helps insurers recommend preventative best practices and behavior, such as the right nutrition and exercise, reducing healthcare expenditures for customers due to unhealthy habits.
6. Faster underwriting process
The manual medical underwriting process in health insurance is highly time-consuming, inaccurate, and cumbersome when it comes to examining the applicant's medical history.
With advancements in technological devices, such as fitness trackers and smartwatches, insurers can use and analyze the stored users' data on these devices to find more accurate and efficient ways to underwrite users.
Importance of Artificial Intelligence in the Healthcare Sector
Every industry evolves with changing times, and new and advanced technologies are needed to keep up with changing trends and requirements. As the healthcare industry revolutionizes and moves towards digitization, Artificial Intelligence plays a major role in data analysis and provides critical insights about customers.
For instance, manually handling and analyzing a large volume of stored customer data is not only feasible and burdensome but also increasing risks of inaccuracy and customer dissatisfaction.
This makes integrating Artificial Intelligence and Machine Learning algorithms into the healthcare and health insurance sector paramount as it helps in:
- Improving and quickening data analysis, thus promoting better decision-making.
- Reducing the risks of fraud and mistreatment by providing relevant, accurate, and personalized recommendations to customers.
- Ensuring faster claim settlement and reducing the burden and workload on the healthcare employees.
- Offering round-the-clock and highly responsive customer support through AI-driven chatbots, thus enhancing customer experience.
Let's get into more detail about these aspects by looking at the impact of AI on health insurance.
What is the Impact of AI on Health Insurance Companies?
AI in health insurance helps companies and insurance providers save money, enhance accuracy, and boost customer experience, making the industry more efficient and secure than before.
Here are the benefits of AI in health insurance with its positive impact:
1. Better decision-making based on clinical observations
AI and ML algorithms help insurers and health insurance providers offer relevant treatments and advices and diagnose patients with the help of large amount of gathered and analyzed data in real-time.
AI analyzes different types of patient data, including the patient's medical records, genetic information, blood sugar levels, and real-time monitoring data and also considers the patient's responses to treatments and unique characteristics to tailor personalized treatment plans.
This enables health insurers to improve outcomes, minimize adverse medical effects, and take corrective measures, strengthening decision-making.
2. Improved accessibility
Reaching out to healthcare providers or health insurance executives at odd hours, after office timing hours, or bank or other holidays becomes difficult.
AI in health insurance significantly helps overcome this challenge. AI-driven chatbots and virtual assistants offer round-the-clock support and accessibility to policyholders.
These chatbots can address the policyholders' concerns and solve their queries regarding policy coverage, claims, or other details, providing immediate assistance in real time—without making the insurance holder wait for longer hours.
Besides, the highly conversational nature of these bots and virtual assistants makes communication easier for insurance holders, offering a more intuitive, human-like, and user-friendly experience, as if the policyholders are talking to real human agents.
3. Early illness detection
AI in health insurance enables early illness detection by analyzing vast amounts of data, enabling proactive interventions, and predicting health-related risks. Statistics suggest that 90% of hospitals will be using AI for remote patient monitoring and early diagnosis by 2025.
AI uses data and historical information, such as diagnoses, images, scans, and medical reports, to educate itself over time.
So, this data analysis and remote monitoring enable predictive analysis, allowing AI to identify subtle changes in the patient's medical reports and health metrics. This alerts customers and healthcare providers to take timely measures and necessary precautions to detect illnesses at an early stage, mitigating consequences and reducing healthcare costs.
4. Enhanced drug development
AI accelerates drug development in the healthcare and health insurance industry by analyzing biological data. This enables scientists to focus on specific and required drugs and more effectively predict drug safety and efficacy than traditional methods.
Traditional drug development methods are time-consuming and even include frequently missed deadlines before companies can provide the right treatment and medical prescriptions to the patients.
AI enhances drug development and optimizes clinical trail designs, developing and bringing new drugs to the stores much faster and at a lower cost.
5. Streamlined operations and processes
By automating administrative tasks, improving resource allocation, and optimizing workflows, AI significantly streamlines operations and processes in health insurance.
For instance, AI in health insurance reduces insurers' burden by streamlining tasks like booking appointments, automating claim processing, tracking patients' treatment, and translating clinical notes. It also improves customer experience through responsive and conversational chatbots and virtual assistants.
Thus, AI helps improve productivity and ensure faster and more convenient operational efficiency by reducing manual intervention, ensuring accuracy, and reducing cost.
6. Time and cost-efficient
As discussed earlier, saving time and money has been the biggest impact of AI in the healthcare sector, enabling early illness detection and diagnosis and reducing time to offer early treatments.
Besides, AI in health insurance sector helps minimize administrative overload, automate underwriting processes, and enhance fraud detection, ensuring better operational efficiency, faster service delivery, and enabling cost savings.
Challenges and concerns in AI adoption
While AI has emerged as one of the most disruptive technologies in the healthcare and health insurance industries, it comes with several barriers and challenges when it comes to the adoption of implementation of AI in healthcare.
Here are some of the top challenges and concerns about adopting AI in healthcare.
- Data security and privacy: Health insurance consists of sensitive personal health information of policyholders, which may raise the issue of data privacy and security. Ensuring compliance with regulations, like the Health Insurance Portability and Accountability Act (HIPAA), is crucial to prevent risks of data breaches.
- Ethical considerations: AI algorithms might make decisions regarding coverage denials or risk assessments, which may lack human oversight or transparency, raising ethical concerns related to consent, autonomy, and accountability.
- Algorithmic biases: AI may include and exhibit biases, especially when trained on datasets that are not representative, leading to discrimination and unfair treatment against a specific demographic group.
- Regulatory compliance: Healthcare and health insurance are subject to strict compliance and regulatory requirements, making it more complex and challenging for AI adoption. Ensuring compliance with these governing regulations to ensure data protection and consumer rights is crucial to avoid regulatory risks and penalties.
Future of AI in Health Insurance
As AI becomes deeply integrated into the healthcare and health insurance sector, it's expected to disrupt the claims, underwriting, distribution, and other aspects of health insurance, making it even more data-driven, accurate, and personalized.
Here are some future trends expected when it comes to AI in health insurance:
- The increase in connected devices: The coming years will see a significant increase in the number of connected consumer devices, such as smartwatches, smartphones, fitness trackers, and home assistants, in new categories, such as medical devices, eyewear, clothing, and shoes. Experts estimate that there will be 30 billion connected devices by 2025.
- Open source and data ecosystems: With data becoming more ubiquitous with time, several private and public sector entities will come together to establish open source protocols and ecosystems to share data across multiple industries for multiple use cases. For instance, wearable data on connected devices can be ported to insurance carriers—disrupting the health insurance industry.
At the same time, customer experience with buying health insurance policies will become even faster and more convenient with minimal active involvement with AI holding enough information about the individual's health data, risk profiles, and medical records.
Thus, with rapid technological advancements, AI is set to transform the health insurance industry, making it more efficient, secure, accurate, and convenient than ever before.
Arya AI's Health Vitals Monitor for the Insurance Industry
Understanding the growing importance and convenience of implementing AI in health insurance, we at Arya.ai provide an excellent API called the Health Vitals Monitor API.
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This helps healthcare and insurance providers assess the individual's health and well-being while also understanding their mood and stress level. With just a 30-second scan, the API provides a complete overview of an individual's mental and physical wellness, which is highly imperative to the health insurance industry.
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Conclusion
AI provides innovative solutions to the healthcare and health insurance industry, improving operational efficiency, reducing workloads, streamlining data analysis, and enhancing the relationship between an insurer and policyholder.
While AI continues to save time and costs for health insurance providers and seekers, staying ahead of the curve and making the most of emerging and advancing technologies is crucial to improving customer experiences.
So, make sure you check out and try Arya.ai's Health Vitals Monitor API to beat the competition, gain critical insights, and boost user experience.