April 13, 2015 | By Rey Villar
Several months ago, I wrote a blog post discussing the challenges that cause health plans to lose money on their claims payment integrity programs. In this post, I’d like to dive deeper into the problems caused by insufficient technology and dispersed payment integrity operations.
If your organization is plagued by manual integration of recovery results and fragmented financial reporting, then this post is for you.
Technology and data silos
The “technology” supporting most claims payment integrity organizations is a proliferation of spreadsheets and local databases. Consider that often times, payment integrity groups in a health plan overlap by line of business (e.g., Commercial COB, Medicare COB, and Medicaid COB) with multiple payment integrity areas (e.g., coordination of benefits, subrogation, claims review, etc.) using multiple technologies and spreadsheets to execute their business processes and collect payment integrity data.
The variety and proliferation of payment integrity databases that are not integrated with one another causes expensive redundancy, inaccuracy, and data inconsistency issues, which lead to a lack of business trust in the data. No single operational or reporting database houses all of the enterprise-wide payment integrity information, including claims, member, eligibility, and provider data. As a result, there often is major confusion about “what the data means” – multiple answers to the same question. The business does not have access to business definitions for entities and attributes – this is an issue that needs to be addressed.
Fragmented member eligibility data
Dispersed eligibility data – an essential input for any payment integrity process – only exacerbates the problem. Healthcare payers receive data that impacts a member’s eligibility from multiple sources. This information is typically not well-organized, and it is not uncommon to see a payer with eligibility information stored in many different systems, which are often siloed by line of business. The challenge is there isn’t a single version of the truth for eligibility data, which is a requirement for making primacy and payment determinations. The eligibility data that is available is accessed via multiple business functions within the organization without regard to who owns the data. There is typically limited data governance and no evidence of active data quality management. Many payers don’t have enough time to proactively address these eligibility data issues, resulting in:
- Excess costs from ad-hoc patient requests
- Lower autoadjudication rates
- Claims overpayment
- Manual work associated with non-standardized appeal processes
- Improper mandatory reporting
As a result of fragmented and prolific data sources, the volume of data and transactions is too great for the current payment integrity staff to manually synthesize data from reports, file extracts, spreadsheets, and other sources. Time that should be spent performing analysis is being consumed by manual data integration, reporting, and forecasting activities. Data is many times updated monthly or weekly versus daily. Additionally, payment integrity organizations frequently have many manual processes that they execute along with paper handling – with IQ letters for example. The ordering and coordination of processes across business departments that handle overpayments is difficult to keep up with on a manual basis using spreadsheets.
Insufficient transparency and financial reporting
Likewise, payment integrity organizations frequently rely on manual reporting using tools like Excel and don’t have automated reports or self-service interactive dashboards that will allow them to see recovery performance by recovery area and by vendor on a timely basis. This situation also makes it difficult to capture and track productivity metrics related to how the payer’s internal recovery teams are performing. The reporting that is available as a rule is oriented more towards the payer executives and perhaps middle management versus what is needed on a day-to-day basis to run an efficient payment integrity organization.
Payment integrity forecasting, like reporting, is also typically done on a manual basis using spreadsheets. Trusted historic data that is needed to develop an accurate forecast may not be available, making it very difficult to forecast accurately based on historic results and trends.
In the throes of healthcare reform, health plans are being asked to do more with less – to work smarter and more efficiently across all functions of the organization. The current situation for many payers leads to an unnecessary reliance on claims recovery – which creates more work and more cost. Payers that manage payment integrity-related data more strategically across their organizations will be in a stronger position to understand the overall performance of payment integrity operations and to improve the outcomes of those operations. In upcoming blog posts, we’ll discuss technology and solutions to help payers overcome these challenges.