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LearnmoreaboutElectronicClaimsProcessingandMedicalBilling

Manyclaimsarefiledelectronically,infact,Medicarerequiresit
AnewstudyrecentlyreleasedbyAmericasHealthInsurancePlans(AHIP)showsthat
threequartersofallhealthinsuranceclaimsarenowsubmittedelectronically,upfrom24
percentin1995,allowing98percentofclaimstobeprocessedwithinamonthofreceipt
fromthehealthcareprovider.
Theproportionofinsuranceclaimssubmittedtohealthplanselectronicallyhasmorethan
tripledinthelastdecade,reducingadministrativecostsandsignificantlyspeedingup
paymentstodoctorsandhospitals.
In2002,just44percentofclaimsweresubmittedelectronically,comparedto75percent
today.
Thereisoftenasignificantdelaybeforehealthinsuranceplansreceiveclaimsfromhealth
careproviders,especiallyforthoseclaimsstillsubmittedonpaper.In2006,nearly3
claimsintenwerereceivedmorethan30daysafterthedateofpatientservice,withone
thirdofthepaperclaimsnotreachingtheinsurerfor60daysormore.
Twentyninepercentofclaimswerereceivedfromhealthcareprovidersmorethan30
daysafterthedateofpatientservice,and15percentofclaimswerereceivedfrom
providersmorethan60daysaftertheservicewasprovided.Fourteenpercentwere
pendedordelayedduetoincorrectorincompleteinformation,takinganaverageofnine
dayslongertoprocesswhilemoreinformationisrequestedfromtheprovider.
Electronicclaimsarelesscostlytoprocessthanpaperclaims.Theaveragecostof
processingacleanelectronicclaimwas85cents,nearlyhalfthe$1.58costofprocessing
acleanpaperclaim.Pendedclaimsrequiringmanualorotherreviewcost$2.05on
averageperclaimtoprocess.
Nearlyhalfofallclaims(48percent)werependedduetothesubmissionofduplicate
claims(35percent),lackofcompleteinformationorotherinformationneededtojustifythe
claim(12percent),orinvalidcodes(1percent).Twentyfourpercentofpendedclaims
wereduetocoverageissues,includingnocoveragebasedondateofservice(8percent),
noncoveredornonnetworkbenefitorservice(7percent),coordinationofbenefits(5
percent),orcoveragedetermination(4percent).Otherormiscellaneousreasonswerethe
causeoftheremaining28percentofpendedclaims.
In 2006, Medicare expenditures were $382 billion. Also in 2006, the Office of
Inspector General estimated that $10.8 billion in fee for service payments were
improperly made. There were 43 million Medicare beneficiaries in 2006.
In FY 2006, the enrollment for Medicaid was estimated at 47 million people, with
a total outlay of $317 billion.
Inthepastfewyears,thehealthcareindustryhasgonethroughsomebigchanges.Although

manyclaimsarefiledelectronically,therearemanyfactorsthatcauseclaimstogounpaid
andtherearemanyreasonswhyprovidersstillneedyourassistance.
Onereasonisthatemployersaremovingtowardhighdeductiblehealthplans(HDHPs)to
cutcosts.Thereisalsoanewtrendwhereconsumersaremovingtohealthsavings
accounts(HSAs).Bothofthesetypesofhealthplansrequirethepatienttopaymoreoutof
pocket.Thatmeansprovidersmustworkharderatcollectingtheirmoney.
Payers and employers will continue to shift the costs of health care to
members by moving them into highdeductible health plans (HDHPs) and
reducing benefit coverage. As patients bear more of the financial burden for
their health care, it will be harder to collect these larger amounts. Providers
should expect to reevaluate how their offices are run to improve collections
from patients.
Theuseofautomatedtechnologyisveryimportantintoday'sageofgettinginsuranceclaims
paidtoolslikeelectronicmedicalrecords(EMR),electronicfundstransfer(EFT)electronic
remittanceadvice(ERA),realtimeadjudication,claimscrubbingservices,codingsoftware
productsandothertechnologytoolsarebecomingincreasinglynecessary.However,notall
providerscanaffordtoinvestinthosetechnologiesandsomesimplydon'twantto,making
outsourcingoftheclaimsprocessanattractivealternative.
Additionally,whiletheskilllevelnecessarytogetclaimspaidhasriseneachyear,theskill
levelofthepersonperformingthetaskinmanyprovider'sofficeshasremainedthesame.
Insuranceclaimsspecialistsutilizemuchofthetechnologiesmentionedabove,typically
allowingthemtoproducebetterresultsinlesstimethantheaverageprovider'soffice.
Carriersarealsousingdataminingtocreateliterallymillionsofeditstoreducepayments
anddenyclaims.Theyemployvariouswaystoimproveontheprevioustechnology,suchas
greaterselectivity(applyingeditstosomeprovidersandnotothers),longitudinal
comparisons(i.e.basedonpatienthistory),andpatternmatching(i.e.upcoding).
Experiencedmedicalbillerscaneffectivelyutilizetechnologiesavailabletothemtoget
claimspaidandtofightclaimdenials.Everyday,itgetsharderforhealthcareprovidersto
collectinsurancedollars.Individually,providershaveagreatincentivetoutilizeoutsourced
billingsolutions.

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