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The
need for electronic eligibility systems in
the
discount medical plan industry
and
how it can save time and
money.
SUMMARY: Discount Plans can save a great deal
of money by implementing an Electronic eligibility system. Practically
all of their contracted providers already are familiar with some
form of electronic data interchange (EDI) for claims and eligibility.
Most discount plans do not have the means to check eligibility
electronically; this costs both the provider and the discount
plan time and money.
DETAIL REPORT: Today, most HMO’s and insurance
companies either have their own electronic eligibility system
or bundle the eligibility into a national claims clearing house,
with most being HIPAA compliant. One of the major reasons
for the importance of electronic eligibility is due primarily
to the huge financial responsibility being carried by the medical
community. The insurance carriers have had to find a way to assure
that the individuals being treated are eligible and the medical
providers are paid. If just two percent of all claims are rejected
due to ineligible patients, this could amount to thousands of
dollars. Eligibility for many insurance companies and medical
providers are fairly complex since it involves the patients benefit
package, co-pays, deductibles and limitations. Medical
providers are willing to link into an eligibility system in order
to facilitate claim payment. In most cases, the cost of checking
eligibility is part of the price of claim submission, likewise
many insurers implemented electronic eligibility to satisfy their
medical community.
The bottom line is that it is very important that medical organizations
verify patient eligibility and their benefits in order to provide
the proper patient care and submit claims accurately (if needed)
to the insurance companies.
Now what about those providers and organizations that do not
submit claims but still need to verify patient eligibility? What
if there was a way of checking patient eligibility and benefits
through an online means? There are thousands of plans throughout
the United State that would benefit from such a system. This
in turn would save the discount medial plans (Dental, Vision, Chiropractic or
DME) time and money.
What are some reasons preventing to switch to an online system
and how it is costing the organizations money?
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They believe that their needs are being met, but if by following
the same logic that medical claims industry uses, the providers
may be losing a great deal of money. Given the fact that there
are no real claim dollars at risk, they do lose revenue when
a provider treats an individual thinking they have a discount
and they do not. If a provider is giving away two percent of
the non-discounted fees, they are losing hundreds of dollars
each and every month. This problem will only increase as our
economic problems continue.
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When a provider finds a patient that did not have coverage,
they then must attempt to collect the additional payment, which
takes time for their staff and in many cases causes a write-off.
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If the provider uses the electronic roster, this roster
is normally produced monthly or possibly twice a month. All
new members and renewal members do not show up on the lists.
When this happens the office staff contacts the plan to verify
the enrollment, which takes time away from other duties for
both the office staff and plan staff. Based upon numbers
of appointments and time required to verify, at least eight
to ten hours a month are being spent on the phone by each
organization.
-
Search criteria are limited on most rosters for two reasons
one is the plans must be very careful not to violate HIPAA
regulation, and two, too much information makes it more difficult
to distribute.
The outcome is that both the plan and the providers could be
losing thousands of dollars every month.
How to help?
The plan should implement or contract with an outside company
to provide the electronic eligibility system; there are two methods
of implementing this:
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If a plan has a closed network, which means all providers
are linked into the plans computer system, the plan can set-up
an intranet system to allow the providers to check eligibility.
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If the plan has an open network where they contract with
many providers, and they do not link into their computer system,
the plan can contract with an electronic eligibility company
to provide these services.
For additional information please contact:
Joseph J. Hughes, President
HealthSoft Enterprise Systems
joe.hughes@health-soft.com
(602) 418-7508 or
Contact Us page
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