![\"Deterrence-based](\"https:\/\/biznews.fiu.edu\/wp-content\/uploads\/2019\/05\/Healthcare-costs-study.jpg\")
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Skyrocketing spending and excess costs in the healthcare industry can be reduced by deterrence-driven algorithms, innovative auditing methods that focus on increasing overall deterrence of waste and abuse in the long run.<\/p>\n
FIU Business<\/a> research found that these are based on the concept of \u201csentinel effect\u201d by which, once a set of practitioners is audited, information about the audit and sanctions are communicated to other practitioners who then make an extra effort to ensure that billings are accurate.<\/p>\n Traditional auditing methods focus on detecting fraud, using scoring models to select practitioners or claims that are likely to be fraudulent. Deterrence-based methods maximize the direct benefits of audits by generating a response among audited fraudulent practitioners (audit effect). However, they overlook the second-order benefits of driving action among non-audited practitioners informed about audits underway elsewhere (sentinel effect).<\/p>\n The algorithm first filters out practitioners with low fraud probabilities to preserve fairness. Taking into account both the audit and sentinel effects, the method then estimates the network deterrence that will be generated by auditing each practitioner. Practitioners with the highest expected deterrence impact are then selected for audit.<\/p>\n \u201cOur healthcare system is in dire need of reform that will decrease excess costs,\u201d Lina Bouayad, assistant professor in the Department of Information Systems and Business Analytics<\/a>. \u201cAuditing algorithms such as the ones described in this study can help policy makers move in this direction.\u201d<\/p>\n![\"Lina](\"https:\/\/biznews.fiu.edu\/wp-content\/uploads\/2019\/05\/Lina-Bouayad.jpg\")