At no time during the history of the $3.2 trillion health care system in the U.S. has there been so much change in how we pay for health care services. Most of that change is being driven by cost concerns, which, in turn, incent each stakeholder to shift its financial risk for patient care to someone else.
The only way patients, payers and providers can see their way through the reimbursement fog is achieving payment clarity.
Payment clarity is the ability to see clearly: What something costs; who pays who for what; how much each side pays; and when they have to pay it. By knowing those four elements of payment clarity, patients, payers and providers can safely navigate their way to a safe landing.
Three Steps to Achieve Payment Clarity
The question for health care providers is: What can they do to achieve payment clarity for themselves and for their patients and payers? There are three steps providers can take.
- Providers must be able to furnish accurate cost estimates to patients prior to the services they are to receive. Those estimates must include the total cost of care and who is responsible for what share of that cost, including what patients should expect to pay out of pocket.
- Knowing what patients are expected to pay out of pocket, providers must be able to collect part or all of that payment at point of service. Post service, they should follow accepted guidelines on seeking payment and collecting any overdue bills.
- Providers must know prior to service what they should and will be reimbursed by payers for their share of the total cost. That means verifying patients' health plan, benefits, benefit levels, cost-sharing components and any required prior authorizations or utilization review.
Manually taking those three steps is inefficient at best and impossible at worst. That's why I strongly recommend that to achieve true payment clarity and satisfy each of its four elements, providers must leverage technology to help automate and streamline each component of revenue cycle process.
How Technology Can Fuel Payment Clarity
- U.S. operating division of Ahold NV based in Zaandam, Netherlands
- U.S. headquarters are CarlislePa., and Quincy, Mass.
- 115,000 U.S. employees
- Publicly traded
- Six brands: Giant Carlisle, Giant Landover, Stop & Shop New England, Stop & Shop New York Metro, Martin's and Peapod
- Operates 770 supermarkets, 562 pharmacies and 210 pick-up points in 14 states and D.C.
- Four health and household business lines: Pharmacy, health and beauty care, household needs and baby care
Pre-service solutions can validate a patient's identification, verify his or her benefits and eligibility and automate prior authorization and utilization review. They can determine benefits, benefit levels and the financial responsibility for both patient and payer. They can also calculate a bill estimate and prepare a recommended point-of-service deposit amount for the patient.
Post-service, technology can automate the claims management process, setting up exception-based workflows that speed billing for routine claims while flagging problematic claims that can be quickly resolved by finance department staff. Technology also can help improve denial management by identifying coding errors prior to submission. That will become even more important after the ICD-10 diagnostic and procedure codes take effect on Oct. 1 despite that CMS recently said it will (PDF, 199 KB) from physicians who use the wrong codes.
Technology can also fuel a provider's advanced data analytics, or Big Data, program. Providers can use Big Data to extract actionable revenue cycle data to establish payment performance benchmarks and alert the finance department staff to significant variations. That knowledge could lead to additional actions to ensure accurate payments are made on time.
As the health care reimbursement skies continue to fog up, achieving payment clarity no longer is something nice to have. It's a necessity. Providers that master it will reduce their uncompensated-care costs and financial uncertainty. Those that don't, risk flying blind with nowhere to land.