Why Manual Processes Are A Barrier To Payer-Provider Collaboration

By Dan Schulte, SVP Healthcare, HGS Inc.

As payers and providers seek to uncover collaborative opportunities in an industry increasingly shifting toward patient-centric healthcare and value-driven outcomes, it’s critical to examine the most significant barriers to improved partnerships.

Differing business approaches and legal mandates, as well the lack of data integration and transparency, has certainly contributed to abrasion between payers and providers. However, delayed or incomplete reimbursement and inaccurate coding continues to present an especially significant challenge, and is often exacerbated by inefficient and costly manual processes.

The Cost Of Doing Business
According to the 2016 CAQH Index report on healthcare’s adoption of electronic transactions, the administrative costs of closing data gaps between payers and providers consumes nearly $300 billion per year—about 15% of all healthcare expenditures.

Denied claims, prior authorizations, patient eligibility and other utilization management processes represent a significant financial and administrative burden for providers. According to a 2017 article by Becker’s Hospital Review, denied claims for large hospitals (250-400 beds) can be as high as 7% to 10%, which can cause intensive resource allocation to manage denied claims and significant revenue leakage due to forgoing the appeals process.

Compounding the problem is the fact that most of these processes are manual, rather than electronic. Both payers and providers spend a great deal of time approving these requests or communicating essential information about changes to reimbursement processes by phone, fax, and even postal mail. This inevitably leads to greater inefficiencies and administrative burdens, lower reimbursement, and unnecessary treatment delays for patients.

The ability of providers and payers to engage and collaborate to improve patient outcomes, drive down costs, and enhance administrative efficiencies is essential to the industry’s larger shift to value-based care. Realizing these goals will require health plans and their provider networks to rethink their business workflows in the key areas of automation, business process outsourcing, and technology integration.

Reducing Administrative Burdens
Creating a successful payer-provider relationship depends on both parties coming to the table with an open mind and a commitment to establishing and maintaining trust. With this foundation in place, they can focus on creating alignment in several key areas.

Allowing providers to leverage health plan data, such as claims and benefit and eligibility information, at the point of care would help physicians move from episodic care to delivering care focused on the continuum.

In addition, tools like self-service portals allows both payers and providers to access complete, actionable data, reducing administrative burdens for both parties, achieving higher performance goals, and identifying coding and care gaps more quickly. Continued investment in automation and self-service is also critical in order to focus precious resources on treating patients and keeping them well and less time on administration and compliance.

Alignment Through Automation
Payers and providers each possess patient data that when put together that not only provides a more holistic view of the patient/member but also allows providers and health plans to identify opportunities for more cost-effective and outcomes-based care strategies for high-risk populations.

Manually obtaining authorizations is labor-intensive and stressful, with payers constantly changing the rules for multitudes of different plans. It can also cause provider staff burnout and increase patient dissatisfaction. Automation reduces or eliminates manual processes for many tasks with data-intensive processes, across multiple domains and verticals. It acts autonomously to use and run multiple applications, bringing inherent data protections and transactional integrity across systems and providing clear audit trails.

Automating transactions like prior authorizations can streamline workflows, and also help prevent denials by alerting schedulers if a rescheduled service falls on a date beyond the authorization’s end date. For example, the technology flags the scheduler that the authorization needs to be renewed, which can save some providers hundreds of thousands of dollars a year. That’s in addition to savings from avoiding denials based on a neglect to acquire an authorization at all.

Health plans can align with providers by offering efficient administrative processes. Ideally, alignment should allow providers to share with payers all relevant clinical data on their patients based on an agreed upon care plan and compensation. Payers would reciprocate with clinical care support and administrative tools to ease costs and administrative burdens, and enhance efficiencies and clinical outcomes through actionable data shared throughout the continuum.

For example, automating utilization management and other transaction processes can streamline workflows, as well as speed the exchange of clinical, financial and patient data to near-real time. In addition, the use of multi-payer portals allows providers to exchange information with multiple health plans they contract with at the same time.

Claims Denial Management
Automation can also positively impact the rate of denied claims. According to the Advisory Board, although nearly two-thirds of denied claims are recoverable, 90% are preventable. The truth is that most denied claims are the result of errors, oversights, and the inefficiencies of manual claims processing.

Employing technology and services that improve a provider’s clean-claim rate by eliminating manual functions, identifying claim issues—such as eligibility and authorizations—and capturing modification in health plan rules before prior to submission can save hospitals and health systems millions of dollars in claim adjudication costs. Automation can also help with bundled-payment programs, which aggregates payments into a single fee and are often a cause of denied claims.

Effective automation relies on good business process design, with multiple factors to consider, including systems use, business impact, data touchpoints, ROI of labor, and investment. And the ROI—from the front office and the back office—is significant.

For example, robotic process automation (RPA) reduces or can even totally eliminate the manual effort required for many activities or tasks. RPA doesn’t require back-office integration through APIs and seamlessly works with end-user interfaces and enterprise applications. The technology-agnostic solutions work well with data-intensive processes, across multiple domains and industry verticals.

Summary
As health plans address the underlying problems of organizational silos, legacy systems, and manual processes, they are making it easier for providers to share quality and risk information; reducing the number of requests to providers by asking the right person for the right information at the right time; and improving adoption of data management systems by allowing providers to quickly and easily update their demographic information and send it to all participating health plans.

With access to timely and accurate data, health plans are better able to manage costs, improve engagement with providers, and ensure members have the information they need to make informed healthcare decisions.