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Building Blocks of an Effective LTCi Fraud, Waste, and Abuse Mitigation Program

By Jane Menin Bagley, Esquire, SVP, General Counsel and Chief Fraud Officer at Fuzion

LTCi claims have continued to steadily increase  over the past decade.  In 2023, LTCi carriers paid out a record $14.1 billion in claims. [1] As LTCi claim dollars increase, so do the dollars attributed to  fraud, waste, and abuse (“FWA”). Industry studies and Fuzion’s client experiences tell us that 5-10% of all insurance claims have a fraud component; and this statistic does not include the percentage of insurance claims that include elements of waste and abuse. [2] FWA mitigation requires a well-planned, multi-pronged approach to help protect your policyholders and minimize the FWA impact on your company’s LTCi business.


Does your FWA program contain the following building blocks to identify, investigate, and effectively address FWA?

  • Qualified Fraud Examiners and Case Managers

People are key to the success of any organization, and the human “factor” is even more of a critical component in mitigating insurance FWA. One of the top challenges in the area of insurance anti-fraud programs is the ability to acquire and retain qualified talent to support strategic FWA mitigation initiatives. Qualified fraud and claims examiners should have at least two years of professional experience, specifically in the niche area of LTCi. Certified Fraud Examiners (CFEs) possess specialized knowledge and skills to (i) effectively identify and address red flags (especially important ones that are not easily identifiable through data points), (ii) to triage and analyze data reports; (iii) strategically handle complicated and difficult cases, and (iv) stay current on FWA and LTCi trends through professional memberships.


  • Fully Documented and Effective FWA Program

LTCi companies without clearly defined FWA programs are at risk of failing to recover losses, damaging their reputation, and being subjected to fines or non-compliance penalties. When a company commits to establishing a robust FWA program that is customized to meet their needs, they can be assured that they will be in the best position to effectively address FWA  and optimize risk management of their business.


  • SIU / FWA Program Integrated with Claims Operations

SIU departments and FWA programs must work closely with claims organizations to identify and evaluate claims that may involve FWA and warrant further investigation. Company processes and workflows should be integrated with claims operations to ensure best-in-class communications, documentation, and operational efficiencies in order to better manage and reduce the incidence and severity of questionable claims.


  • Frequent FWA Training Using Case Studies

One of the most important components of any effective FWA program is  awareness training for essential personnel including claims examiners, case managers, call center representatives, and investigators. Customized and frequent training should be interactive, engaging, and include case studies and current trends. Awareness training programs significantly increase the effectiveness of FWA programs by providing tools and awareness to empower employees to promptly identify, address, and resolve questionable claim activity. This results in quicker resolution of questionable claims, an enhanced reputation for customer protection, and improved financial management.


If your FWA program does not tick all these boxes, Fuzion can help you fill in the gaps. We were among the first to focus on addressing the steadily increasing trend of FWA in LTCi claims and its financial impact. The direct impact of FWA mitigation on LTCi blocks is significant. Fuzion’s experience with clients has proven that implementing FWA programs that check all these boxes leads to multi-million dollar impacts that serve to protect both insurance companies and their policyholders. Our early development of strategies and actions to identify, investigate, and mitigate FWA is recognized as a best-in-class solution in the LTCi industry. Visit our FWA Services page for more details.  


American Association for Long-Term Care Insurance (AALTCI).


Coalition Against Insurance Fraud. (2022). The Impact of Insurance Fraud on the U.S. Economy
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