Managing medical claims effectively is an extremely complex task. Each process has numerous steps and variations which makes it difficult for insurers to bring about consistent improvements in the claims operations. Medical Insurers also need to find a better way of reducing claims processing expenses as insurance payouts form a substantial part of an insurer’s costs. But an insurance policy holder’s service needs and their right to receive an equitable and fair settlement must never be compromised for cost efficiencies. A policy holder’s loyalty and satisfaction are largely dependent on their claims experience and therefore, medical insurance companies must give the high-quality experience more importance. The National Health Insurer Report Card by the American Medical Association has stated that a rise of 2% in claims processing errors caused an unnecessary administrative cost of $1.5 billion to the health system.
Factors that influence the payment of claims are rarely within the control of the insurers but steps can be taken to mitigate frustrations and unwanted expenses which are usually associated with claims denials and delays. Insurance companies find it difficult to operate when the claims system involves complex, confusing steps, and manual procedures which in turn results in an inefficient, error-prone structure that drastically affects the company’s performance. The goal must be to prevent operational issues in claims from arising by observing and dynamically managing processor productivity and behaviors and pinpointing opportunities to improve compliance, accuracy, and productivity. Health insurance companies can significantly increase their return on investment (ROI) by streamlining methods to operationalize claims processing and reduce the steps involved in claims processing.
Here are the best practices in medical claims processing:
Submit Claims Electronically:
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HIPAA regulations make it mandatory for claim transmissions to be made electronically. Though this is ideal, as it saves a lot of paperwork and reduces errors, not all claims are submitted electronically. Electronic claims also take 30% less time to process compared to paper claims. Electronically submitted claims usually take around one to two weeks to process. Once the claims are submitted, claim status along with remittance advice can be viewed online, prior authorization can be requested, provider profile can be maintained and member eligibility can be verified. Once all of this is done, claims are usually settled in two hours or less. Electronic submissions also prevent unnecessary claims denial, decrease costs and increase cash flow.
Prevent Inaccurate Info:
Delay in providing reimbursement is usually caused due claim processing errors. If these errors are not resolved, policyholders may not get paid at all. The typical reasons for claims rejection include wrong patient names, insurance IDs, date of birth, address, CPT (Current Procedural Terminology) or ICD (International Classification of Diseases) codes, and place of service code. As rejected claims are not processed, no appeal is accepted and the claims have to be corrected and resubmitted all over again.
Prevention is the best way to increase claims payments. A clean claim must be submitted without any errors. If the information doesn’t look right or is difficult to read, originating documents such as patient insurance cards must be referred to make things right. The front office employees at the insurance company must ask each and every patient for any changes in their insurance or patient info. Updating this info after the claim has been rejected is more difficult and time-consuming. The American Medical Association the electronic claim processing accuracy of insurers is around 88% to &73%. When it comes to claims processing in healthcare, time is the biggest enemy. Identifying errors and resolving them quickly is extremely important as most insurance payers have time limits within which the rectified forms have to be filled and submitted.
Collect Copayment, Deductible, and Patient Balances:
On most occasions, the patient financial responsibility statement is not collected before the commencement of the treatment which results in patients forgetting their checkbook or walking out without paying. During registration at the front desk, copays must be collected. Before any additional charges are levied on the patient, it is advisable to review the patient’s account so that prior balances, if any, can be collected. If a deductible shows up in the insurance verification, a small deposit amount must be collected from the patient up front and the balance amount must be settled after the treatment. If the patient has already met their deductible elsewhere, it is cheaper for the insurance company to mail refund checks rather than to follow up and write off uncollectable balances.
Invoice the Patient:
As soon as the explanation of benefits (EOB) is posted, the patient invoice must be sent. If a patient receives the invoice sooner, the more likely they will pay up. The patient invoices must clearly detail each and every aspect such as services performed, date of service, payments already collected, insurance reimbursement received, and any other balance amount. The invoice must be easily comprehensible and must have a patient-friendly feel and look. Various insurers accept credit card payments over the internet or the telephone which accelerates payment and reduces costs and saves customers the time of writing and mailing a check.
There is high pressure on insurance companies to improve their performance and visibility and comply with all the regulations. With so many areas coming into the picture, analytics is the best option. Analytics and automation help insurance companies to bring about improvements in operations, bridge process gaps, and improve services rendered to the members. In the current scenario, insurance companies are usually in the dark about the source of the errors and problems. Analytics will provide insurance companies with the right capabilities to avoid common errors and handle complex claims thereby removing performance variability, reducing operating costs, and deploying people in areas where their skills will be best utilized.
Following these best practices in medical claims processing can streamline processes and improve efficiency. The National Health insurer Report Card has stated that close to $17 Billion can be saved annually by eliminating claims errors. It would be unrealistic to think that claims processing errors will be completely eliminated in the future. But insurance companies can take a dedicated step toward reducing errors that can benefit a large number of people who avail medical insurance. Medical insurance companies can effectively overcome the challenges of processing speed, accuracy, volume, regulatory compliance, and administrative costs by outsourcing to an expert medical insurance claims processing service provider and improving customer satisfaction levels.