Leading Australian Health Fund HCF Automates Claims Processing with ILOG BRMS

HCF Improves Straight Through Processing, Reduces Claim Handling and Settlement Costs

SYDNEY - July 11, 2007 – ILOG® (NASDAQ: ILOG; Euronext; ILO, ISIN: FR0004042364) today announced that the leading Australian Health Fund, HCF, has implemented ILOG Rules for .NET as a key component of its automated claims adjudication and payment system, thereby reducing the costs associated with handling, processing and settling claims. With ILOG Rules for .NET, a key offering in ILOG's business rule management system (BRMS) product line, HCF has reduced the time required to evaluate and settle claims by about 30 percent, while automating fraud detection. In addition, it can now implement rule changes within days instead of weeks, and the number of people managing the claims system has been reduced from 10 people to only three, allowing HCF to re-deploy the experienced staff to other parts of the organization.

HCF is the fourth largest health fund in Australia, offering more than 423,000 health memberships covering over 978,000 people and providing more than 341,000 policy-holders with HCF life insurance. Founded in 1932, HCF provides a means for customers to mitigate the cost of hospital in-patient care. Individual practices hospitals and billing agents submit claims electronically to HCF to check eligibility criteria and determine the proper payment.

With an average of 27,000 claims to process every day, HCF needed a robust solution to shorten the time it takes to validate, review and settle claims, while also ensuring consistency. The new BRMS-based system enables HCF to eliminate redundant data and quickly respond to changes in business and government regulatory requirements. The new system also enables HCF to achieve an automation or pass-through-rate of 80 percent.

Using ILOG's BRMS, HCF achieved significant speed to market gains by implementing rule changes within four days instead of three weeks that it used to take previously. Prior to using ILOG Rules for .NET, maintaining the business rules was difficult because they were less visible to business users. With ILOG's BRMS, claims-related business rules are extracted from the legacy systems and maintained in a centralized rule repository making them easier to manage.

HCF was also able to achieve greater alignment between IT objectives and business strategies by extending rule management to business users. In addition, HCF can ensure that fraud detection is an integral part of the claims process, enabling the carrier to identify suspicious claims early in the claims' lifecycle. Carriers can easily add or change attributes and score incoming claims to support their fraud detection guidelines. It took HCF just eight months to build and deploy the new system, with benefits realized immediately.

"A BRMS was the right strategy and ILOG's solution was the right choice. ILOG Rules for .NET fits well into our architecture," said Patrick Shearman, Chief Information Officer, HCF Australia. "The BRMS also provides flexibility for our future needs and enables IT and business to collaborate to manage business rules. Not only have we realized the vision of STP, ILOG's BRMS has assisted HCF to become a leader in the field of claims automation by being the first health insurance entity in Australia to implement it."

About ILOG
ILOG delivers software and services that empower customers to make better decisions faster and manage change and complexity. Over 2,500 corporations and more than 465 leading software vendors rely on ILOG's market-leading business rule management system (BRMS), supply chain planning and scheduling applications, and optimization and visualization software components, to achieve dramatic returns on investment, create market-defining products and services, and sharpen their competitive edge. ILOG was founded in 1987 and employs more than 800 people worldwide. For more information, please visit http://www.ilog.com.

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