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EDD Case Study

EDD strengthens its fraud detection methods using state-of-the-art Aquila Benefits Fraud system

At A Glance

EDD saved millions of dollars of taxpayer’s money during the increased incidences of unemployment claims during the COVID-19 pandemic.

Highlights

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EDD saved millions of dollars of taxpayers’ money by preventing fraudulent unemployment benefits
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Better equipped to support prosecutors to identify, investigate and prosecute fraudulent claimants during COVID-19 pandemic

Business Challenges

The Employment Development Department (EDD) is one of the largest state departments with employees at hundreds of service locations throughout the state.

EDD used legacy systems to detect unemployment fraud committed by single location, multiple family members claiming the same benefit, identity theft, falsified disability insurance and provider fraud. The existing system was highly inefficient in processing the data to detect fraud. Since gathering information took weeks before you could prosecute fraudulent claimants it added to the overall difficulty and timeline of detecting and preventing fraud. The system lacked the intelligence to detect and prevent fraudsters from gaining unauthorized benefits at the cost of taxpayers’ income.

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“At the EDD, we are dedicated to detecting, deterring, and preventing any occurrence of fraud in our programs. Aquila’s fraud analytics solution has enhanced our ability to detect fraudulent activity. It has helped saved several man hours in supporting prosecutors with adequate evidence against the scammers and their false claims.”

Spokesperson

EDD, US State West

Solutions

Aquila provided real time fraud detection solution which refereed to several external data sources and red flagged the record which were suspicious. The solution analyzed millions of claims with different CPT billing codes and average billing rates and highlighted anomalous bills. It used the demographics combined with location information to detect if potential claimants were involving in submitting fake claims.

Aquila’s fraud analytics solution comprises of various modules to detect providers with non-compliant license and other not-in-good-standing statuses. It has the ability to detect excessive billing or wrongful billing and uses link analysis to check multiple beneficiaries and parties from a common address and/or various colluding actors.

Results

The new system at EDD has the capability to process and analyze over 60 million records with each record having up to 500 attributes within 90 minutes.

The Anti-fraud Investigators Workbench

Helped detect a medical provider and its facility with fraudulent license. The providers were validated using extensive external sources from SOS, DIR, DCA and Medical License Boards
The system can provide real time validation using Provider NPI and supports extensive use cases of provider including suspended, not in good standing and expired NPI

Claim Fraud Analytics solution

The system provides ability to detect providers with higher average billing per CPT code
Use of geo tags to identify % of claims per provider by zip code
Detect Higher % of referrals to specific service provider by zip code

Claimant Fraud

Ability to detect fraud scenario like multiple family members submitting claims
Link analysis showing all actors and claims for the same home address
Configurable link analysis based on the number of links indicating potential fraud