Administrative demands in the healthcare industry are very complex and organizations of every size face administrative challenges every day. However, one thing that payers and providers have in common is when administrative challenges are overwhelming, it can be felt across the entire healthcare ecosystem. Between varying technology adoption rates, workflow designs, and evolving patient care practices, payers and providers can find themselves facing communication barriers that can negatively impact the care cycle and bottom line for everyone involved.
In this second edition of Exploring the Complexity of Healthcare in the U.S., we are taking a closer look at a specific administrative-based challenge that payers are facing in the United States, interoperability.
What is Interoperability?
Interoperability allows healthcare organizations of all sizes to communicate with each other when it comes to exchanging patient data. Interoperability is most commonly discussed in conjunction with electronic health records (EHR) and billing systems. Interoperability not only impacts patient care, but it puts an undeniable strain on a healthcare systems’ bottom line and resources. A few signs of poor interoperability in the payer arena include manual errors being made in insurance coverage, Explanation of Benefits (EOB), pre-authorizations, and medical billing. The reason that interoperability is challenging is because there are so many healthcare organizations at various stages of technological advancement when it comes to securely transferring a high volume of patient data.
How Interoperability Impacts Payers
As many have experienced during their lifetime, there are times when patients receive care from different providers or specialists. More often than not, pre-authorization is required to receive that care. Integrating that data efficiently across the care cycle not only gives providers access to a patient’s full medical history, but payers can ensure that the patient is receiving the correct EOB and invoice. Simplifying the workflow between payers and providers is something that the healthcare industry has been working toward for a number of years. A laser focus on this challenge is needed more than ever as the United States remains one of the highest among developed countries when it comes to cost per person.
Healthcare is an industry that is in a constant state of evolution. In the early 1990s, Centers for Medicare and Medicaid Services (CMS) began taking the first steps to streamline communication efforts and transaction sets for payers and providers using 837s and 835s. During this timeframe is when HMOs, EPOs, and managed care began to emerge.
Despite the healthcare industry being one of the most innovative industries in the world, interoperability and workflow processes continue to be a challenge even in 2021. A lot of advancement has hit the healthcare market over the years, such as Fast Health Interoperability Resources (FHIR) and API standards. There have also been significant introductory efforts made within the industry to see how new IT standards that support interoperability and continuity can be applied to the original systems. However, a significant amount of work for improvement within the industry is still needed.
Relying only on human intervention when it comes to communicating coverage to providers, pre-authorizations, and inputting information from paper claims not only leaves room for errors that can result in a denied claim and financial frustration for many, but it takes up an immense amount of time and labor for health plans.
“While the industry continues to make progress automating administrative tasks, opportunities remain. Although electronic transactions have become more efficient, transactions that continue to be processed through partially electronic web portals and manual methods are becoming more expensive and time consuming,” according to the 2020 CAQH Index report. “To address these automation gaps, standards and operating rules need to be updated more frequently to adapt to changing business needs. As business needs change and technology advances, the industry must work together to align on common expectations for data exchange to keep administrative expenses in check.”
If a process or technology that is meant to make a workflow design more efficient is not executed or supported well by the proper expertise, the adoption rate by the healthcare organization is usually low. Administrative challenges and the fragmentation between entities also typically continues, if not gets worse. The lack of interoperability between payers and providers has a negative impact on the patient experience and outcome.
Lowering Healthcare Administrative Costs is a Calling for Signature
Healthcare administration costs are on the rise almost making up 30% of all medical bills received. Keeping that number low impacts not just the healthcare organization, but also those who are being billed for the treatment they received. By ensuring that documentation is correct before it is sent to the payer, the flow of the revenue cycle can go uninterrupted and healthcare administration costs can be kept to a minimum. Patients can also feel confident that they are paying the correct amount when they are sent an EOB after receiving treatment.
At Signature Performance, we want to inspire new possibilities within the healthcare industry and bridge the gap in communication efforts between payers and providers so data can be used in a meaningful way for a better end result for the healthcare ecosystem. When important healthcare data can be utilized in a meaningful way, it ensures that the patient experience and outcome are not only positive, but it also allows healthcare systems to hone in on and deliver the type of care that they see as most needed in the communities they serve.
Our team’s mission is improving not only our clients’ business, but the entire healthcare industry. We do this by finding better ways to leverage technology, implement operational readiness, and other industry-leading processes which provide technical solutions and ultimately lower the cost of healthcare administration. We have the personnel and technical capabilities to be a one-stop shop connection for the end user, whether that be a payer or provider.
Every day, our team channels our passion for our mission in a way that allows us to solve some of the most complex challenges facing the healthcare industry. We believe the healthcare industry in the United States deserves only the best, and that sentiment is what motivates our dedicated team to do our very best each and every day.
Read the first article of this series: Exploring the Complexity of Healthcare in the U.S. for Providers
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Christa Williams is the Vice President of Consulting Services at Signature Performance Inc., in Omaha, NE. Signature Performance is an industry leader in reducing healthcare administration costs for private and public healthcare sectors. Our unmatched experience in serving both the payer and provider side of healthcare financial management allows us to implement innovative solutions for every administrative demand.