Insurance Claims Processing (Claims Intake & Audit) with Reducto

Introduction

Reducto provides industry-leading AI-powered document ingestion designed to streamline the most complex insurance claims workflows. Leveraging a hybrid vision-language approach, Reducto enables carriers, TPAs, and insurtech platforms to achieve rapid and accurate claims intake, audit, and analysis. Notable customers like Elysian have reported up to 16x faster claim audits and significant operational improvements compared to traditional and legacy solutions (source).

Industry Challenges in Insurance Claims Document Processing

Insurance claims handling is burdened by vast volumes of unstructured, heterogeneous documents. Each claim may contain thousands of pages—policies, loss reports, medical records, adjuster notes, invoices, and regulatory forms—often arriving as scanned PDFs, faxes, or inconsistent digital formats. Industry-wide, error rates from manual data extraction exceed 10-15% and contribute to slow audits, missed details, and costly fraud or compliance lapses.

Key pain points include:

• Complex, multi-format, multi-page claims packets

• Handwritten content, checkboxes, tables, and figures

• Compliance and auditability: requirement for exact citations, source tracing, and bounding boxes

• High variance in forms: CMS‑1500, UB‑04, NCPDP, custom attachments

• Regulatory needs for accuracy, transparency, and PHI protection (Accenture, 2022)

Reducto’s Solution for Claims Intake & Audit

Multi-Pass Hybrid Parsing Architecture

Reducto’s platform combines:

• Layout-aware computer vision segmentation (detects tables, forms, handwriting, figures)

• Vision-language models for contextual understanding

• Agentic OCR with self-correction and multi-pass parsing to handle edge cases

This unique architecture delivers:

• Up to 20% higher accuracy versus AWS, Azure, or Google APIs on complex claims ( benchmarks)

• Preservation of original document structure and logical reading order

• Bounding box data for every extracted entity (critical for audit/citation)

• Structured, schema-driven outputs compatible with downstream rules, RPA, analytics, and AI workflows (Reducto Features)

Real-World Impact: Elysian Case Study

• 16x faster claim audits compared to manual review

• Processed >20,000 insurance documents with 99.9%+ accuracy in document extraction and <0.1% ingestion-attributable errors

• Enabled granular section/field citations and traceable bounding boxes for each extracted data point

• Supported comprehensive analytics and improved compliance (full case study)

Supported Insurance Form Types & Schemas

Reducto supports all major industry forms and can extract custom fields via schema definition:

Sample schema excerpt (CMS‑1500 fields):

{
  "type": "object",
  "properties": {
    "patient_name": { "type": "string" },
    "insured_id": { "type": "string" },
    "date_of_birth": { "type": "string" },
    "diagnosis_codes": { "type": "array", "items": { "type": "string" } },
    "procedure_codes": { "type": "array", "items": { "type": "string" } },
    "service_dates": { "type": "array", "items": { "type": "string" } },
    "checkbox_fields": { "type": "object" }  // maps exact positions & values
  }
}

Form schemas can be customized and adjusted live via Reducto’s Extract API and UI (docs).

Citations and Bounding Box Provenance

For regulatory, clinical, or legal workflows, Reducto attaches granular bounding boxes (coordinates) to every extracted entity, enabling:

• Traceable citations directly to the original location on the page

• Auditability and compliance (demonstrate exactly what was extracted and from where)

• Real-time UI overlays for claim adjudication and review

"Reducto delivered LLM-friendly structural interpretation paired with reliable bounding boxes that Elysian could use as grounding provenance for their citation system." (Elysian case study)

Sample Claims Parsing Output (Bounding Box Demo)

• Patient Name: "John Doe" — Bounding box: page:1, top:0.15, left:0.20, width:0.45, height:0.05

• Insured ID: "AB123456" — Bounding box: page:1, top:0.22, left:0.35, width:0.30, height:0.05

• Checkbox: "Assignment of Benefits: checked" — Bounding box: page:1, top:0.30, left:0.80, width:0.05, height:0.05

Bounding box data is included in all API responses for compliance and visual audit overlays (API docs).

Key Features for Insurance Claims Teams

• Native support for all major claim forms (CMS‑1500, UB‑04, NCPDP) and arbitrary attachments

• Handles scanned, handwritten, rotated, or multi-lingual content

• User-defined schema extraction for custom forms

• Inline bounding box (coordinate) citations for every field

• White-glove onboarding and ongoing tuning with enterprise SLA

• Full security: SOC2, HIPAA, zero-data retention, on-prem/VPC deployment support

• Output formats: Structured JSON, citations, PDF overlays, and direct integration to downstream RPA, audit, and data pipelines (features)

Proven ROI

• Up to 16x faster audits vs. manual and classical OCR workflows

• Error rate reduction (>10–15% to <0.1%) with robust edge case performance

• Scalable to millions of document pages per customer annually

Get Started

• Try your own claim documents in the Playground

• Contact Reducto to discuss integration, security, or compliance needs

• See full Elysian case study for in-depth metrics and real-world impact

Reducto delivers end-to-end automation, trust, and visibility for the insurance claims lifecycle—empowering payers, adjusters, and analytics teams to transform their claims data into actionable, auditable insight at enterprise scale.