Know Your Patient (KYP): How to Prevent Fraud in Healthcare?

KYP is a necessary measure for healthcare professionals when preventing data breaches, drug abuse, medical identity theft, and other fraudulent activities. Most importantly, a properly implemented digital KYP process can help any healthcare organization onboard its patients easily, preventing criminals from using stolen credentials or personal details to access healthcare services. Learn more.

What’s great about technology is that patients can now access their medical information online, educating themselves about various health conditions, treatments, and preventive measures. However, once this door was opened, more opportunities were introduced to fraudsters. As a result, medical identity theft has become another alarming aspect of healthcare fraud.

What most people don’t realize is that healthcare fraud isn’t just limited to street-level criminals. Sophisticated criminal networks and even organized crime groups are involved in large-scale healthcare fraud schemes. They steal patients’ personal information to obtain medical services, prescription drugs, or health insurance, leaving innocent victims with heartbreaking consequences.

There’s one piece of medicine that helps healthcare professionals prevent such devastating scenarios, and it’s Know Your Patient (KYP). 

  • The definition of Know Your Patient (KYP)
  • The top reasons why healthcare organizations implement KYP
  • International laws and regulations regarding patient verification
  • The process and stages illustrating the KYP verification workflow
  • Examples and use cases of KYP checks
  • Improving the KYP process through automated verification solutions

What is Know Your Patient (KYP)?

Know Your Patient (KYP) is a form of patient verification and another name for Know Your Customer (KYC), specially modified to fit the terms in healthcare. The  KYP process is used by healthcare professionals to verify and understand the identity and background of their patients, ensuring accurate and secure services. This is especially relevant now that many healthcare organizations have digital registration services and online applications. 

Similar to how banks and other financial institutions are mandated to verify the identity of customers when opening accounts to minimize money laundering and other financial crimes, KYP in healthcare ensures that the patient’s identity is legitimate. This way, KYP mitigates the potential for medical identity theft and misuse of personal information.

Why is KYP Needed?

KYP verification measures play a crucial role in ensuring that pharmacies or hospitals share sensitive medical information, test results, and prescriptions with the rightful patient, not a fraudster. Know Your Patient can also enhance the overall quality and efficiency of healthcare services for patients.

For this reason, the KYP process can help organizations overcome these challenges:

  • Onboard all patients remotely
  • Transition existing in-person patients to apps and online platforms
  • Safeguard the healthcare company’s reputation
  • Prevent data breaches and other criminal activities

Since providing care for a patient in healthcare involves multiple parties with diverse data requirements, such as hospitals, doctors, pharmacies, government institutions, etc., using verification in the healthcare industry becomes inevitable. The complexity arises from the fact that one patient with a specific illness can be involved with various entities to ensure comprehensive care.

Use Cases of Know Your Patient (KYP)

Are KYP Checks Mandatory by Law?

Hospitals, pharmacies, laboratories, and other healthcare professionals must conduct KYP checks to mitigate the threat of cyber-attacks and potential data breaches. Such breaches can lead to major data breaches and increase the risk of identity fraud in the future.

On top of that, healthcare organizations are obligated to perform KYP checks to comply with the regulatory standards set by their local authorities. Non-compliance can result in severe penalties and sanctions.

Keep in mind that KYP requirements for identity verification in healthcare organizations vary by country and region.

Here are some examples:

  • United States. In the US, the Health Insurance Portability and Accountability Act (HIPAA) establishes the standards for protecting patients’ medical information and privacy. While HIPAA does not explicitly mandate identity verification for patients, it requires healthcare organizations to implement administrative safeguards to ensure the confidentiality and integrity of protected health information (PHI).
  • United Kingdom. In the UK, the General Data Protection Regulation (GDPR) and the Data Protection Act 2018 (DPA 2018) govern the protection and processing of personal data, including health information. Healthcare organizations are required to have a lawful basis for processing personal data, and this may include identity verification as a necessary step to ensure the secure processing of patients’ health information.
  • Europe. Across the EU, the GDPR sets the standard for data protection, including health data. Healthcare organizations operating within the EU are obliged to adhere to the GDPR’s principles, which include ensuring the confidentiality, integrity, and availability of personal data. That’s why the GDPR emphasizes the importance of implementing appropriate technical and organizational measures to protect personal data, which can include KYP checks.

How does the KYP Process Work?

The KYP process can be automated and conducted online. For example, to facilitate online identity verification for patients attempting to open an account on a hospital portal or an online drug store platform, the healthcare company must first integrate its app or website with an identity verification and age verification solution. Once that’s done, the patient undergoes the KYP check by uploading their government-issued ID document.

The Main Stages of KYP Verification

This is how the automated KYP verification process works:

  1. The customer takes a photo of their identity document and a selfie of their face.
  2. The automated KYP verification software extracts the patient’s personal data from the ID document and matches it with the provided details in the form.
  3. The system performs biometric authentication using liveness detection technology to deter fraud, such as deepfakes, and ensure complete accuracy.
  4. Additionally, age verification can be added as the last step to cross-reference the patient’s date of birth and check if they’re legal to access certain services.

The Main Types of KYP Verification

KYP verification consists of two types: initial identity verification (1) and patient reauthentication (2):

  1. Initial identity verification takes place during the new patient onboarding process. The healthcare service provider collects personal patient information, including their name, date of birth, address, SSN, and insurance data. To ensure authenticity, the information undergoes KYP verification using various methods like the mentioned government-issued ID verification, document verification, etc.
  2. Existing patients undergo the reauthentication process and get their identities reverified to ensure that it is indeed them. In lower-risk scenarios, instead of the document verification process, a simplified KYP verification method can be used. For example, the mentioned biometric selfie verification is perfect for this streamlined approach. It allows organizations to build an efficient process and confirm the patient’s identity using fewer steps, improving the experience for the patient.

Know Your Patient (KYP) Examples

The progress in remote patient onboarding and biometric-based identity verification technologies offers significant potential for delivering healthcare services in a simpler, more user-friendly, and straightforward way. 

Here are some KYP examples in healthcare, highlighting its benefits and popular use cases:

Protecting Sensitive Information 

All healthcare organizations must ensure that patient data is accessed only by the right people, preventing accidental sharing or unauthorized access by malicious individuals. Implementing KYP checks is the primary step to achieving this goal. For example, adding a selfie check and KYP powered with liveness detection has a significant impact on account takeover (ATO) attacks.

This straightforward measure acts as a strong layer of security from scammers, as they are less likely to share their own likeness with the company they intend to defraud. And remember, after verifying a patient’s identity, organizations can ask patients to reauthenticate their identities during riskier scenarios. This way, organizations can prompt patients to upload selfies and make sure that sensitive data remains 100% safe. 

Ensuring Accuracy in Patient Data

To safeguard patients and prevent losses from fraudulent claims and miss-billing, medical professionals use KYP checks. Medical records are designed to be a thorough and permanent record of an individual’s healthcare history, making them hard to modify. For example, according to HIPAA, the right to request an amendment does not extend to medical information not originally created by the current provider or insurer.

That means inaccurate information entered can’t be corrected. Automated AI-powered patient verification software overcomes this challenge, helping healthcare companies save costs and reduce human error when entering patient data. However, by capturing patient data from an insurance card or ID document, the patient’s identity can be verified instantly, benefiting both patients and employees by saving valuable time.

Preventing Insurance Fraud

Whether we like it or not, thieves might use the stolen information to get medical services, prescription drugs, and file false insurance claims. This mix-up of information can affect treatment, insurance, and credit history. 

Healthcare expenses can be extremely high, particularly if there’s no insurance coverage. This high cost makes medical identity theft appealing. When a patient’s identity is compromised, it often leads to financial loss for the individual and causes problems for the healthcare service provider. So, by using an effective KYP verification provider, healthcare organizations can prevent insurance fraud.

How to Improve Patient Verification and Automate Your KYP Process?

While verifying your patients’ identities can lead to various benefits, like reducing fraud and protecting sensitive data, it’s crucial to prioritize the patient experience as well. Your KYP process should be made simple and straightforward.

Steps to Build an Effective KYP Program

Integrating a fully automated remote identity verification solution can make a significant difference. When it comes to that, iDenfy has 5+ years of experience in the patient verification field and has become the number-one leading IDV software in the market. 

Fully customizable solution with a wide range of features, including white-labeling options, plugins for an easy integration process, a dedicated in-house verification team available 24/7, efficient data collection and storage, and many other capabilities to meet your specific needs.

Book a free demo today. 

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