By Pat Sullivan, Chairman & CEO, ClearPrice Networks
Workers’ compensation insurers, TPA’s, and self-insured employers have been paying healthcare providers to provide medical treatment to injured workers longer than any reader of this article has been alive.
And somehow, there are still a few fundamental things that we haven’t yet gotten right.
I will get straight to the point: I think the end-to-end medical billing, medical bill review and payment processes in place today to pay healthcare providers for approved medical treatment, services and equipment is broken.
What we put healthcare providers through today to get paid for their services should be embarrassing to all of us. We must do better as an industry. If we don’t, the healthcare providers that still treat workers’ compensation patients are finally going to give up on us and focus on the other 95% of the medical treatment market (Medicare, Medicaid, commercial).
Once access to quality healthcare shrinks, recovering from an injury will take longer, disability durations will go up, costs will rise and who knows what happens from there.
If history repeats itself, some industry outsider will blissfully suggest we incorporate the medical component of workers’ compensation into group health coverage and away we’ll go with a another “back to the future” discussion about “24-hour care” that will remind many of us of the early 1990’s.
If you have read this far, you are probably already tired of the rhetoric and you want some facts, or details, and maybe a suggestion or two about how to fix the legacy issues that affect all of the stakeholders in our industry. So, here is short list (certainly not all-inclusive) of what is broken and some high-level suggestions to fix it:
Healthcare Provider Billing:
It all starts at the first step in the process. If healthcare providers want to get paid quickly and accurately, they must improve the accuracy, data quality and coding integrity of their electronic billing files and paper billing. Yes, we all know state fee schedules are challenging, but that isn’t going to change anytime soon.
In a medical bill processing environment today that auto-adjudicates ~50% to ~80% of all medical bills, the accuracy, data quality and coding integrity of billing matters. If you don’t get it right the first time, and your bill is denied, rejected, or returned as inaccurate, you can add another 15-30 days to the processing cycle because your “revised” and/or “corrected” bill will go right back in the processing queue.
Frankly, some of this bill processing practice of denials or rejections is driven by well-intended regulatory payment timelines with their attendant fines for non-compliance. That means payers really don’t have a choice but to require a “clean bill” that they can pay in 30 days or less to be in compliance in many states.
Here’s a novel solution: take the time to get your billing right the first time, collaborate with payers, e-billing intermediaries and bill review companies and strive for 100% accuracy in your billing. It will help you avoid the aggravating and time consuming “reconsideration” process and accelerate cash flow.
Workers’ Compensation Payers and TPA’s:
We must strive to do better if we want healthcare providers to be key partners in the medical treatment process, which, by the way, is a critical part of our mission to “cure and relieve the effects of industrial injuries”.
We also must demand better from bill review vendors and processing partners. For example, Medicare and many large commercial health plans/payers auto-adjudicate and pay medical providers in less than ~5 to ~10 days after receiving a clean bill. Do you know any Payer or TPA that can meet that standard today? If you do, I would quickly try to figure out what they are doing right and replicate it.
The bottom line for Payers and TPA’s is we all need to take every commercially reasonable step possible to shorten payment cycles to healthcare providers to 2 weeks or less. If you can do that, you will discover a completely different level of engagement from your most heavily utilized healthcare providers which will lead to better outcomes, lower disability durations and lower overall costs.
In closing, think seriously about the fact that the entire workers’ compensation industry medical spend represents ~5% of the total medical spend in the US in a given year. If the workers’ compensation industry’s medical spend is that insignificant when compared to other payers of medical treatment, we all need to find ways to enhance our relationships with healthcare providers so they are engaged and motivated to deliver the high-quality medical care, services and equipment injured workers need to recover from their injuries.
And remember, if we don’t do this, someone else will try…and they might just succeed this time.
About Pat Sullivan
Patrick J. (Pat) Sullivan is the Founder, Chairman and CEO of ClearPrice Networks, Inc. (CPN). Pat brings 30+ years of payer and provider experience in the healthcare management segment to CPN including workers’ compensation, commercial group health, healthcare provider programs and employee benefits. As a serial business builder, executive leader, consultant and Board member of both public and private companies, Pat has either led or has been a key part of the strategic growth and success of numerous small to middle market sized companies.
In addition to his role at CPN, Pat also serves on the Board of Medlogix, a private equity sponsored technology and clinical services provider of auto and medical claims management solutions.
You can learn more about Pat’s background by visiting his LinkedIn profile.
About ClearPrice Networks
ClearPrice Networks‘ mission is to drive efficiency, transparency and lower costs into the sourcing, provision, billing and reimbursement processes in the DME, prosthetics, orthotics, medical supplies and home care service line in the ancillary services segment of workers’ compensation and auto claims industry. By eliminating the legacy “rebilling” business model, CPN is able to drive excess cost out of the healthcare system, lower costs for payers, accelerate the delivery of equipment and services, expedite payment to CPN provider partners, and contribute to better patient outcomes.
ClearPrice Networks is a WorkCompWire ad partner.
This is NOT a paid placement.