2nd Generation Financial Harms Controls for the Insurance Sector

Conventional risk management, fraud controls and investigations are not proving to be enough in the property and casualty, and health care insurance sectors.  Financial harms prevention and reduction strategies center on the deterministic controls of cause and effect. These linear models are bound by approximations.

Linearity is precise enough to construct mechanical outputs. The models assume by knowing a present state, the past and future states can be projected along a straight line. Small incongruities in data can be ignored as “noise” –  that is the errors in the math calculations which are so small that it doesn’t effect building bridges, officer towers, machines and other physical constructs.

But the insurance sector payment plans are dynamic and nonlinear  complex systems , the stuff of quantum mechanics and the mathematics of chaos. The whole is rarely the sum of the parts. The costs of controls rarely correlate directly with prevention outputs.  Payment plans are complex systems.  “Complex systems” thinking is the new horizon for mitigating threats posed by waste, misuse and abuse. It will require clarity in distinguishing ordinarily honest people cheating a lit bit when tempted to do bad things, from predatory fraud. It is a move away from rational choice and  ‘wack a mole’ linearity, to better understanding the inter-connectedness and inter-dependencies between things in order to reduce harms situational or geographic specific enough to go to war on in a few short months and measurement of outcomes.  

tranzform-security is an idea importing complex system thinking and prevention science to conventional controls for preventing insurance payment system waste, misuse abuse. It draws on insights from psychology, neuroscience, social physics, mathematics (chaos) and evolutionary biology.   

Ignoring negative environmental conditions and minor bad behaviors is a slippery slope to accelerated waste, misuse and abuse behaviors. It becomes too easy for people to self-justify bad behavior with rationalizations to reduce stress when tempted to do bad things. The tranzform team works with risk managers, administrators and loss-reduction specialists to nudge the right behaviors and to  identify and get on top of people cheating a little bit before it escalates into larger scale problems.                                                                                                                                                                                                                                                                                                                                                                                                                                                                          Joel Alleyne                                                                                                                                                                                               
Work with us

We will assist clients deep dive into health care and property and casualty insurance plan ecosystems. We will help you look for “noise” in behavioral patterns which if addressed early on prevent tipping points to more harmful future states.

Our team assists progressive risk managers, administrators and loss reduction specialists with tools to counter internal waste, misuse and  abuse.  We apply behavioral insights to nudge  people towards higher standards of moral behavior. We bring together at team of like-minded, new science consultants to educate and assist government and business sustain cultures where it becomes more difficult to rationalize cheating when tempted to do bad things.

The Nasty Stuff – Predatory Fraud 

Our predatory fraud and corruption prevention science team works on problems of a different scale. 

The tranzform-security problem-solving approach is unique. It recognizes there is no top-down, cookie cutter solution for controlling predatory fraud. Each ecosystem inside a health care plan will have its own characteristics and “noise”, demanding different combinations of counter-measures. It is a never ending cat-and-mouse game of scan, analysis, response and assessment at levels geographically or situational specific enough to quantify the outlier activities, to identify what uniquely attracts the fraud activity to this geographical and/or situational space, and to tailor counter-measures in reduce the financial harms in projects that or doable and the results measurable for effectiveness.  

John Lyons –  The ATRiM Group


Our education and fraud problem-solving helps organizations reduce the threats posed by individuals who do bad things when tempted and to tackle bands of people without moral conscience. We consult on data mining strategies for identifying outlier behaviors and we teach/consult on our unique approach with a proprietary Situational Health Care Insurance Fraud & Corruption Matrix©. We  take a problem-solving which includes seamless escalation of harms from internal to civil and criminal remedies in a way that optimizes recoveries.

We consult and train organizations on how to mitigate threats from dependency on ID and other documents to do business with people. We develop predatory fraud problem-solvers in organizations. They will learn how to isolate problems in a way that they can be tackled in six to nine months and then measure for outcomes. The lessons learned from this planning-in-action approach to what works and what doesn’t work in each situation, rolls up into the next generation of prevention strategies, and in a way the sustains high levels of adaptability to changing attack methods.

Helping organizations get a Jump Start 

With our prevention science search conference format, our facilitators help insurance plan administrators, controls employees and investigators discover a new mindset on how to controlling  waste, misuse, abuse and predatory fraud. Participants leave with a new level of clarity the distinction between controlling cheating by mostly honest people, and systematic predatory fraud.

The conference (2.5 days) helps create alignment among participants from all level in the organization. It builds the relationships necessary for designing a different approach to these financial harms problems. In the post-conference launch phase, we help our clients develop a planning-in-action culture to find bottom-up solutions that are situation or geographic specific enough to sink the organization’s teeth into in a way that produce measurable results.