The shift to digitized business practices throughout healthcare is heralding increases in efficiency on many fronts besides just patient care. Streamlining the claims adjudication process has become one avenue where practices are able to boost bottom lines and focus on operational efficiency. As a whole, industry wide electronic claims submission to payers is sharply on the rise. According to America’s Health Insurance Plans (AHIP), a national trade association representing the health insurance industry, the percentage of claims received electronically was 94 percent in 2011, up from 82 percent in 2009, 75 percent in 2006 and 44 percent in 2002.
Electronic submission of claims likely means practices are able process them and receive re-imbursements quicker than they otherwise would have in the past. The process can still lag, however, because of a number of variables. For example, in 2011, 66 percent of claims were received by health plans within two weeks of the date of patient service, but 16 percent of electronic claims and 54 percent of paper claims were sent to payers from providers more than 30 days after the initial service date. Nine percent of all claims in 2011 were received more than 60 days after the service date.
Interestingly, about 79 percent of all claims were adjudicated automatically in 2011. The average cost of processing a claim was reported at $1.36. The average cost of processing an automatically adjudicated claim was $0.99; the average cost of processing a “pended” or delayed claim (a claim that requires additional information or more complex manual processing) was $3.99 per claim.
Providers remain committed to making the claims adjudication process as efficient, painless and even automatic as possible. Every efficiency helps, particularly during a potentially lengthy process where adjudication can easily slip into 60 days or more.
For practices, keeping the process simple is important, and electronic attachments used to support the claims adjudication process may be a step in the right direction, especially if a claim is pended for further review by the payer. Obviously, it is the task of the payer to determine what will be paid on a medical claim, but it is a decision that often involves requests for supporting documentation or even entire patient medical records from the provider particularly if payers request documentation that practice administrators must print, prepare, mail, open, index and sort in support of the request. This, of course, is where digital attachments come in and can reduce the ease of transmission of records and supporting documents in support of a claim.
Though attachments are only required in a portion of medical claims (about 10 percent), they have been shown to have a significant impact on the speed of re-imbursements because soliciting and preparing paper attachments slows the process. Payers typically solicit attachments two to four weeks after the initial claims submission; therefore, practices adding digital attachments solutions can shorten this cycle, in some cases reducing their outstanding receivables by 10 to 14 days. Of course, this means they’ll be paid sooner than if the process is solely one of hard copy record transmission.
Additionally, if practices provide a complete set of records during the initial claim submission, when payers begin the claims adjudication process they will be able to proceed with a claim on a simple first pass. Following this line of thought, as we know, insurance reviewers only have so much time, which is limited by how much they have to wade through. Any increase in efficiency in the claims adjudication process increases the number of claims they can process, and results in quicker turnarounds for providers and patients. Electronic attachments have been shown to result in fewer denials and re-work requests, particularly since the typical cause for these delays is a failure to provide required or requested documentation to the payer in a timely manner.
To the point, all sides want to see claims adjudicated as quickly as possible. Because of advancements of electronic attachment technology and even with Medicare’s expansion of its audit program allowing providers the ability to send supporting documentation electronically, technology solutions for practices now allow a simple way for practices to streamline, serve and save.
Lindy Benton is CEO of MEA|NEA, a provider of interoperable electronic attachment solutions used specifically in healthcare.