Embracing Technology To Enable Accurate Claims Payments

posted by Burgess

on March 6, 2019

The health care industry is slow to advance technologically, and the limitations of many legacy systems lead payers to spend time and money fixing inaccurate payments. The claims payment process needs to be more efficient.

Take a look at the shortcomings of the claims process: Disconnected third-party solutions, complex policy updates, authorizations and regulations that affect claims, and the fact that the system works in a linear process that can’t handle today’s complexities.

Fortunately, there are health care IT solutions to address these issues. Advancements in interoperability, integrated ecosystems, and business intelligence allow efficient and accurate payments – the first time.

Claim policy updates | The tipping point | Tools to solve the problem

A better way | How to get there

Claim policy updates across multiple disparate solutions

Why are these updates the life of me?

We’ve all experienced the pain of making updates throughout the claims process. With every change, whether small, like a fiscal year update to Medicare, or large, like the implementation of ICD-10 codes, we spend resources adjusting the claims payment system.

You interpret new regulations, develop requirements across your IT ecosystem, and finally, carry out the changes in the numerous vendor and home-grown solutions that utilize different data formats and update cycles.

When an editing solution is updated by a vendor on the 1st, a pricing solution on the 15th, and a prior authorization solution on the 20th, the process gets even more complicated. On top of that, government agencies, state programs, and Medicare update at different times, and can be late or retroactive. This complex environment leads to significant rework and manual review, and a higher probability of error.

Much of this chaos is because in the health care industry, we tend to search for solutions for current problems. We bolt on solutions to address specific issues, but this only adds disconnected pieces to a broken framework instead of fixing the problem at its core.

All these disparate solutions are also set up to work in a linear fashion. But if information is needed from a component further along in the process – for example, a medical records review performed after pricing – it’s nearly impossible to back up and fix anything quickly and accurately. This creates manual rework and a higher probability of error, causing conflict with payers and providers.


The tipping point

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Embracing the Evolution of Healthcare Technology
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What is stopping us from fixing this?

The technology to address these solutions continues to improve rapidly, but the health care industry is slow to adapt. Many organizations take on increasing operating expenses to support aging and ineffective technology rather than investing in upgrades to the system.

Why? Maybe they haven’t yet reached the tipping point.

For health plans, some of these tipping points could help push them toward new technology:

  • A payer moves toward a commercial venture involving claims administration for several other plans.
  • A medical loss ratio changes and an organization suddenly needs to spend more on medical care and less on administration.
  • Competitive threats, like new entrants using contemporary technology and business practices to operate more efficiently.

But perhaps the biggest tipping point is financial. Technological advances are inhibited by budgets and competing priorities, but neglecting to invest in the advances has led to billions of dollars wasted in administrative and manual claim rework. It’s estimated by the AMA that we would save 14 billion dollars annually by paying every claim correctly the first time. Every day we support outdated systems, we let profits slip away.


Tools to solve the problem

How can technology ease the burden?

One major technological advance for our industry is interoperability—systems communicating seamlessly with each other.

Several research firms, including Gartner, have emphasized that without proper interoperability, payers receive unreliable information, resulting in poor service levels. When systems communicate effectively and exchange data accurately, it enables smarter integration and workflow, fewer translation errors, and complete information to the recipient.

But even when multiple solutions achieve some level of interoperability, there are other challenges. Each solution has separate licenses with contracts, fee schedules, IT updates, and client service teams to get support when there is an issue. Imagine how this challenge is magnified for payers dealing with 50 different point solutions.


A better way

These challenges can be solved with an integrated ecosystem, an enterprise platform with natively-built integration and workflow, so payment processes work together easily.

An integrated ecosystem:

  • Has a single software update cycle, a single cost from an administrative perspective, and a single customer service team as a point of contact if a problem arises. This offers you a more efficient process, freeing resources and time.
  • Shatters the limitations of the traditional linear claims processing path. In our earlier example, a medical records review may find something that needs to be addressed in pricing, but because of the linear process, it can’t be automated. In an integrated ecosystem, pricing and editing solutions interact directly with every solution, allowing full automation.
  • Designs data to be shared system-wide. This makes it easy to run various analytics. One example is forecasting the financial impact of a CMS policy before implementation. Current solutions allow “what if” scenarios that harness shared data, making it easier to see the impact a policy will have on your bottom line. Analytics can be updated in real-time and augmented with artificial intelligence to allow more proactive analysis and decision-making for your business.


How to get there

Which solution is best for us?

In today’s landscape, with developments like value-based payments, accountable care organizations, and mergers and acquisitions creating new major players in the market, it’s truly a bigger risk to resist advances than it is to support them. But how do you approach selecting the best solution for your organization?

When choosing the ideal path:

  • Take a broad look at the impact a new solution has in every area of the payment process so you choose a solution that addresses both short- and long-term needs.
  • Involve all those impacted in the decision-making process: Claims Operations, Information Technology, Provider Relations, Procurement, and other related departments should work together.
  • Evaluate the values and goals of third parties and consultants to find partners aligned with your organization, ensuring mutual success. Requirements for any project should be developed alongside these potential partners. Spend time early in the process working with those in the industry to see what is available, and how you can achieve lasting change.
  • Commit to change. Making a change of this magnitude, and ultimately achieving long-term goals takes time and collaboration—it’s not a case of flipping a switch or plugging in a new system. Full accuracy can’t be achieved quickly. Dedicate the resources to plan for the next 5-10 years with the end goal in mind.
  • Look at the entire payment system and core problems, not just immediate issues. Those tasked with leading the change must have the freedom to fail and try again.
  • Be willing to throw your entire claims payment process away. It’s time to embrace the evolution of technology, much like we have allowed smartphones to render many other tools obsolete.

For so long, our industry has put off technological advances because we think it’s too hard to change course. By embracing the evolution of healthcare technology, we can move toward optimizing care and the way we pay for it.