Editor's note: To see Dave Chase speak about the currentstate of the industry, be sure to attend the 2018 BenefitsPRO Broker Expo in San Diego, April17-19, 2018.

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According to the Department of Labor, companies spend an average of 31.7 percent of labor costs onemployee benefits. This is one of the fastest growing portionsof a company balance sheet, and many companies have just seemed toaccept it. Slowly, it appears there is a new movement in thebenefits space for companies fighting back. The Health RosettaProject is one of those organizations leading the chargeagainst the constant increase in benefits costs. It’s an opensource project that’s created a strategic framework for companiesto use and re-engineer their benefits packages to lower costs by 20percent to 40 percent, while improving overallbenefits.

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One of the leaders in this movement is former Microsoftemployee, Dave Chase, who founded two new $1 billiondollar businesses within Microsoft, including their $2 billionhealth care platform business. He is the co-founder of HealthRosetta and executive producer of The BigHeist Movie, a film on health care that shows how and whyhealth care's financial incentives are wasting trillions of dollarswithin the United States.

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I was recently fortunate enough to chat with Mr. Chase about hisgroundbreaking movement and his thoughts on how artificialintelligence is affecting employee benefits.

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Rick Ramos: What do you see as the biggest issue forcompanies with employee benefits?

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Dave Chase: Put simply, they aren’t applyingthe same level of care to they do to every other major expense intheir business. After all, health care is usually the secondlargest expense after payroll. It’s odd that the same company thatwill reject an expense report that is missing a $62 restaurantreceipt will blindly pay a $100,000 claim. In 20 years of workingon hospital bills, I’m not sure I’ve seen one over $1,000 thatdidn’t have an error or overcharge. Once they apply the same levelof care, they’ll quickly learn that the underlying costs of healthcare haven’t fundamentally changed (with the exception of somespecialty drugs). Thus, you only need to accept hyper-inflatingcosts if you like redistributing your precious resources to ahealth care system that is wildly underperforming by virtuallyevery measure. Smart employers have awakened that world classhealth care is available at half the price of what most employersare paying for mediocre outcomes.

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RR: What areas do you think AI has the most potential tochange within the benefits space?

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DC: AI is most effective when there is cleandata to work with. That excludes a large percentage of clinicaldata. However, in areas such as member benefits or claimsprocessing, there is ample opportunity to apply AI. For example, inmy new book, "CEO's Guide to Restoring the American Dream: How toDeliver World Class HealthCare to Your Employees at Half the Cost,"I wrote about how criminal fraud is much bigger than people think.It’s easy to imagine how smart AI could flag the massive levels offraud (estimated at over $300B per year). Just as your use of acredit card has a certain pattern, so too do medical claims.Antiquated systems used by the claims processors (insurancecarriers) are ill-equipped to thwart the sophisticated cybercriminals that are having a field day with the U.S. health caresystem.

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RR: Almost all employee benefits today are sold througha benefits consultant, how can AI help them do their jobbetter?

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DC: There will be obvious areas, such ascustomer service, where AI can help. Less obvious is how greatbenefits consultants can ensure their clients have a modernbenefits approaches and technology to help them steward the largeinvestment being made in health benefits. Naturally, in areas suchas payment integrity, artificial intelligence can help reduce oreliminate fraud, waste and abuse.

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RR: The decisions that employees make whenusing health care can affect costs massively. What are yourthoughts regarding AI and chabot technology and making employeeguidance simple?

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DC: I think there’s a range of ways AI andchatbots can help employers as well as their employees. They canaddress the common, rote issues that have definitive answers. Theycan also be assistive for more nuanced situations where thecombination of AI and human judgement is the optimal approach.For example, the inputs on the clinical side may be messy, so apure AI approach wouldn’t be sufficient.

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It’s still early days for AI in the employee benefits space, butcompanies are already seeing a huge return on investment and it’sonly expected to grow. Since health care is such a large part of acompany's expenses, these early backers will become morecompetitive within the market. Companies need to start investing inAI technologies and add them to more business processes to improveservice, lower cost and add efficiencies. Companies that fail toimplement AI will be saddled with extra costs and legacy processesthat will erode their market share.

Rick Ramos is the chief marketing officer for HealthJoy.com, an AIguidance and cost containment platform for employers to managetheir health care.

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