We have talked extensively about the fields that rely most heavily on big data. The insurance industry is one of the companies investing the most in big data technology. Exactly one year ago today, SNS Telecom & IT published a report highlighting the demand for big data in the insurance industry. The report showed that insurers spent $2.4 billion on big data in 2018 alone. However, the report didn’t go into the nuances of the types of insurance that are affected by big data. Workers’ compensation is one of the fields of insurance that has been most affected.
Big Data is Turning the Workers’ Compensation Profession Inside-Out
Big data is already making a major impact in one of the largest insurance sectors in the country: workers’ compensation. The industry has been slow to adapt big data and technology that provides actionable insights and changes. Dax Cragen, a CEO and leading expert on workers’ compensation, has already discussed the benefits of big data in his field. Many others are following suit. myDataSense, a platform that is building intelligence programs for workers’ compensation, is already finding success. The platform is using big data to determine the risks and benefits of drug therapy. The platform monitors the patient to be able to determine thresholds, when passed, indicate that a person is at “high-risk.” The risk can be defined by physicians or workers’ compensation officials. The big data approach has many benefits, such as allowing officials to better analyze the pharmacy or doctor the applicant is using. Big data will be able to determine which doctors prescribe high opioid dosages or which have an unreasonably high amount of the same claims. IBM is one of the companies that believes big data is going to have an even bigger role on the insurance industry in the future. Some of the most promising applications haven’t even been identified yet.
Injury Understanding and Course of Treatment
Insurers have an abundance of data which often goes un-utilized. This data is now being incorporated into big data solutions. Data analytics is being used to help injured workers faster and for insurers to better understand the issues that workers with a specific injury face. Big data allows for faster treatment and a better understanding of what the right treatment option is based on similar cases. The solutions that are being developed will be better able to allocate resources and the right people to increase employee outcomes. Developers claim that while insurers have a lot of data, it’s more important that the data is used properly to help with claims. Big data also has the potential to lower medical costs, which account for 60% of all claim costs.
Improved Outcomes and Efficiency
Claims are often tedious to manage and even longer to settle. Injuries and quality care must be a priority, and data analytics can better help management process claims and deliver better outcomes for employees. Faster and more efficient, Liberty Mutual is using big data to help control costs of claims in three key ways:
- Insurers are working on methods of determining if a claim deserves compensation. Not all claims, even if they do occur at work, deserve compensation. Models are able to be produced using big data to minimize the risk of paying a fraudulent or unnecessary claim.
- Insurers want to keep costs down, and one method is through an escalation alert system which alerts insurers that a particular claim may be high-cost. The alert allows for the claim to become a priority and allows for faster treatment to take place.
- Insurers are also using big data to provide better outcomes and comfort to claimants. The big data solutions will provide faster, more robust treatment options that save insurers money while allowing those injured to reduce their risks of long-term side effects.
The return to work process is also being improved with big data able to determine how fast a person can return to work, or how long the person should remain out of work based on new symptoms or conditions. The result? Better outcomes and lower costs.
Big Data is Changing the Future of Workers’ Compensation in Promising Ways
The arena of big data is having a very positive impact on many professionals in the insurance industry. In recent years, most of the discussions have focused on the use of big data in health insurance, because healthcare accounts for such a large share of the economy. However, workers’ compensation insurers are also going to be highly dependent on big data moving forward. IT will be interesting to see how wide-reaching their use of big data will be.
