Untangling the Mess

Are you a health leader?
Qualify for a free subscription to HealthLeaders magazine.

Part 2: The Industry Responds

Editor's note: This is the second installment in a two-part series examining claims processing in healthcare. Read part 1 at: www.healthleadersmedia.com/content/209249/topic/WS_HLM2_MAG/Claims-Quagmire.html

In the complex world of healthcare claims processing, information technology can only go so far. Overlaying electronic data interchange on an intricately fragmented environment has proven challenging, despite the Health Insurance Portability and Accountability Act of 1996, which sought to make the job easier. Although they have made great strides introducing electronic data interchange in both sending and receiving claims, some payers and hospitals are attempting to automate other aspects of the revenue cycle food chain. Following are some examples of how the industry is attempting to untangle claims.

Automating eligibility checks
In 2001, Nebraska Methodist Health System in Omaha began an effort to streamline its revenue cycle. Armed with a new financial reporting system from Cerner, the two-hospital system wanted to integrate real-time eligibility checking at the point of care. Nebraska was seeing too many denials for patients due to incorrect insurance information. It turned to WebMD, a data broker offering eligibility checking online, recalls Don McClenahan, clinical application development manager. The service was spotty, and WebMD could only provide eligibility data for two payers.

Three years ago, Nebraska turned to a replacement vendor, Passport Health Communications. The service has greatly streamlined business operations, says Tami Kohl, director of scheduling and patient registration. Using Passport's Web portal, Kohl's centralized registration crew learn a patient's insurance status—and often qualified benefits—within a few seconds. Charging on a per-transaction basis, the service connects with all 16 of Nebraska's payers, including a few it lobbied Passport to add, such as Iowa Medicaid. "We are no longer photocopying insurance cards," Kohl adds. "It beats tracking down patients four weeks after we billed."

Back-office 'scripting'
Even when insurance eligibility is unquestioned, getting a clean claim out the door is no easy task. "You need to clean up your internal processes," says Bill Overbey, chief financial officer and chief information officer at Hays (KS) Medical Center, a 153-staffed-bed community hospital. Two years ago, Hays Medical revamped its billing process to address a common industry problem. In essence, clinicians keep a running record for one patient, documenting what services they render, says Overbey. But for billing purposes, each encounter requires a separate account.

To tackle the problem, Overbey used scripting software from Boston Workstation. The software enables the clinical staff to document on one patient chart, but separates out individual encounters for the billing staff to use as the basis of the claim. Prior to automating the transfer, Hays relied on staff to manually adjust records, toggling between the clinical record and the billing system. "We are saving two [full-time equivalents] worth of time every month," Overbey says.

Sidestepping intermediaries

Boucher has led the drive at the million-member plan to curtail the need for claims clearinghouses, the intermediary businesses that broker the vast majority of transactions between providers and payers. "We have taken a contrarian stance" on clearinghouses, says Boucher.

"We have tried to eliminate unnecessary electronic handshakes." In 2007, the Columbia-based payer introduced "SuperBill," an online service that enables physicians to file claims directly to the payer. "It is a fully adjudicated claim and takes five to 10 seconds," Boucher says. "It identifies what the provider will get paid, what the member owes, and the claim number. No clearinghouses are involved." The service has been slow to catch on, generating some 20,000 SuperBill claims monthly—a mere handful of the 24 million claims the payer transacts annually.

But Boucher figures that as high-deductible plans grow, physicians will see the value of real-time claims processing with the patient present. "The likelihood that you will collect what the patient owes you deteriorates immediately once they leave the practice."

Strengthening local laws
While HIPAA set the stage for electronic claims, the law falls short in crucial details needed to streamline transactions, says Mike Ubl, director of IT strategy and ehealth at BlueCross BlueShield of Minnesota, a 2.7 million-member plan based in St. Paul. BlueCross Minnesota processes 3 million claims a month, 95 percent of which come in electronically. Despite the high rate of electronic data, Ubl praises a recent state law that will mandate electronic claims submission. "We were getting there anyway," he says.

The real value of the law, however, comes in its standardized business rules pertaining to claims transactions. HIPAA just set up a standardized way to do an electronic eligibility check, for example. The new Minnesota law takes it a step further, Ubl explains, requiring payers to provide more information. "Providers want more than 'yes' or 'no' to member queries," he says. "They want information on benefits, copays, and deductibles. The big issue is coming up with common business operating rules. There is no reason to have a lot of variation."

Gary Baldwin

Comments are moderated. Please be patient.




FREE e-Newsletters Join the Council Subscribe to HL magazine


100 Winners Circle Suite 300
Brentwood, TN 37027


About | Advertise | Terms of Use | Privacy Policy | Reprints/Permissions | Contact
© HealthLeaders Media 2016 a division of BLR All rights reserved.