Exposing Medical Insurance Fraud with Quantum-Inspired Computing

Quantum Codebreakers: How Quantum-Inspired AI is Exposing Medical Billing Fraud

By 11ai | June 2025

The Problem

Every year, the U.S. healthcare system bleeds over $100 billion due to medical billing fraud, upcoding, and the misuse of diagnostic and procedural codes. The complexity and volume of billing data spanning CPT (procedure) and ICD (diagnosis) codes creates a system so opaque that even experts struggle to detect misuse in real time.

The Breakthrough

At 11ai, we are harnessing quantum-inspired optimization models to detect fraudulent medical billing patterns with unprecedented speed and accuracy.

Our platform uses Quadratic Unconstrained Binary Optimization (QUBO), a mathematical structure often used in quantum computing, to identify anomalies hidden in massive datasets. These include:

• Upcoding Charging for more complex services than those actually provided.

• Unbundling  Separating bundled services into individual charges.

• Phantom Billing  Billing for services never rendered.

  
  

How It Works

We analyze claims using real-world cost benchmarks. When a claim’s cost deviates significantly from its peer group, it gets flagged. Using a QUBO model, we feed this data into a solver (quantum or hybrid) that ranks and selects the most statistically anomalous patterns.

This isn't theory it's production-ready anomaly detection, tested and deployed.

Sample Case

In our test set, a single claim using CPT code 99214 was billed at $1,200  over three times the national average. This triggered a high anomaly score in our model and was flagged instantly.

In a live deployment, this would have generated a real-time alert, and possibly an investigation before reimbursement ever occurred.

The Future: Enforcement Meets Automation

We envision a regulatory framework powered by:

• Quantum anomaly detection

• Blockchain-based audit trails

• Zero-trust digital identity and secure AI agents

Together, this creates an autonomous compliance layer a watchdog built into the transaction layer of healthcare.

The Result

Reduced fraud Real-time billing oversight Savings returned to patients, not bureaucracy

Want to see it in action?

Reach out to 11ai we're ready to demo this for payers, regulators, and innovators building the future of ethical, auditable healthcare.

Visit https://www.11aiblockchain.com/