Legal billing and predictive coding

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Legal billing and predictive coding

A fresh way to assess your legal spend

In recent years, many corporate law departments and law firms have been challenged with the task of reducing the costs of delivering services. Similar to other businesses, in-house and outside counsel have sought to streamline activities and improve efficiencies. In order to do that, counsel needs to be able to assess their past and current billing activities.

Uniform task-based management system (UTBMS) codes

Since their introduction more than 20 years ago, uniform task-based management system (UTBMS) codes have brought some clarity to the billing and analytics process, even as the codes have suffered from significant limitations. However, innovations in analytics and predictive coding have introduced new possibilities to traditional UTBMS coding and reporting metrics. With the information that attorneys routinely provide within line-item descriptions in billing invoices, text analytics can be utilized to delve into the informational content of the task descriptions to predict what appropriate codes should be used.

This may allow law firms and legal departments to:

  1. Develop more meaningful metrics at a much lower cost
  2. Gain more insight into cost-to-deliver services, which allows for a more strategic use of alternative billing arrangements 
  3. Improve partnerships between in-house and outside counsel

Delving into legal spend management

When used correctly, UTBMS codes can provide a profile of overall legal spend on a particular matter.

  • Legal spend analysis facilitates effective budgeting by providing a consistent format for the reporting of all matters
  • Standardization of billing helps to increase transparency across different projects and different clients, which can reduce administrative efforts
  • Legal spend data can be important in making strategic decisions for clients by allowing them to compare costs across law firms, and choose the most cost-effective law firm for different categories of the work
  • From a law firm perspective, UTBMS codes aid in the billing process, since standardized codes across projects help the client reconcile and understand the services they have received

Challenges with UTBMS code use

While UTBMS codes and reporting metrics have introduced more clarity, there are still many pieces of useful information that remain elusive.

UTBMS codes:

  • Don’t capture the number of depositions, memos, documents or reports written
  • Provide limited insight about the outcome of the matter, or how favorably the matter was initially viewed and how those expectations may have changed over time
  • They say very little about the quality of the legal services provided, only the quantity UTBMS codes face several other important challenges
  • They are often difficult to check for accuracy, and they tend to be labor-intensive to apply for attorneys

While UTBMS codes and reporting metrics have introduced more clarity, there are still many pieces of useful information that remain elusive.

Advancements in UTBMS code use

While the UTBMS phase, task and code systems have remained relatively unchanged for years, current technological advances in data analytics may breathe new vigor into this avenue of reporting. This demand is primarily being driven by clients seeking more and better information about services that they are paying for and the availability of useful data to inform management decisions.

  • Dashboard-based technology is becoming increasingly interactive with the end user, and this should result in a greater understanding as to what has been provided, how it has been provided and by whom
  • Innovations in text analytics and predictive coding may provide an entirely fresh perspective on the traditional UTBMS reporting environment

With these capabilities, the legal sector could benefit from the ability to more comprehensively evaluate historical or current legal invoices from an activity-based analysis perspective. Such analysis may include both evaluation of the invoices on the basis of UTBMS codes or the integration of other information that reside inside or outside the invoices, such as traditional bill review use and the analysis of activities versus outcomes.

Approach - from baseline to prediction

Through cutting-edge technology and carefully planned processes, Deloitte can help leverage and further the use of UTMBS codes to provide invaluable insights on legal analytics billing for legal departments and law firms. Deloitte professionals have decades of experience assisting those in the legal sphere with analyzing their legal spend information to improve strategic decision-making and predict and manage costs.

The services we offer include:

  • Evaluate current systems and data: We can advise legal professionals with evaluating the current state of their data availability and reporting in their legal invoice management system, including any variations. This provides insights into where the organization is now, and where it wants to be. 
  • Analyze information and frameworks: Our professionals can review existing invoices and inventory electronic invoicing capabilities, then help develop a framework for standard reports and analyses of activity-based legal spend. We work with clients to develop reports and analyses as well as establish baselines for predictive coding of activities. While invoice data may vary, we can help process it in a consistent, standardized manner.
  • Identify next steps: After evaluation and analysis, we can also help identify next steps, including determining where deeper analysis may be valuable, developing custom reports and creating recommendations to manage data going forward.
  • Expand applications beyond legal: As many organizations grapple with exploding amounts of data, we can apply this type of analysis to other business purposes, such as health care claims information.

More information?

Want to know more about Legal billing and predictive coding? Please contact Baldwin Kramer on +3188 288 7215.

Contact

Baldwin Kramer

Baldwin Kramer

Partner

Baldwin is a Risk Advisory partner at Deloitte the Netherlands. Baldwin specializes in the smart use of technology to assist clients solve complex business issues while he recognizes that human behavi... Meer

Bas Sluijsmans

Bas Sluijsmans

Senior Manager

Bas leads the Discovery & Digital Forensic team for Deloitte in the Netherlands. My education in technology, drive to get things created and done have proven to be valuable for me, the people I work w... Meer

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