By Manjunath, Practice Lead, Claims Adjudication, Sagility
Claims optimization continues to provide health insurers a key area of opportunity to reduce consistently high loss ratios. In fact, the U.S. healthcare industry has a significant opportunity to deploy claims automation to save $11.1 billion annually, according to new data released in the fifth annual CAQH Index. And increasingly, automation bolsters the potential of intelligent claims in areas of compliance and decreased provider abrasion.
Payers have recently been achieving significant cost-containment by addressing pre- and post-pay deficiencies as part of the claims adjudication process. Technology only strengthens these capabilities, as well as efficiencies gained from adjudication and other process reengineering projects. In the next several years, many payers will continue to enhance their overall automation capabilities. To focus on these growing areas of opportunity, Sagility leverages our process, analytics, and industry expertise as well as our 1,100 nurses and 400 coders to accelerate adjudication and improve payment recovery.
Over the past decade, the complexity of manual claims processing has increased due to the streamlining and standardization of critical processes such as pre-authorization. Claims processing platforms are now enhanced and enabled to look up these pre-auth guidelines and seamlessly apply on the claim for an almost error-free output. The payer network teams are relentlessly working toward automating the financial comments of a provider contract, so that the claims system can automatically look up these exclusions and apply rule-based decisions on a claim. With all such clinical intelligence built into the system, there is increased effectiveness and noticeable reduction in the volume of claims that would require manual interventions.
The next frontier of claims automation is breakthrough ROI in three areas: compliance adherence, improved financial performance, and enhanced provider engagement.
- Compliance adherence: Payers are challenged by compliance hurdles that come with meeting of stringent CMS and state-specific regulations on claims submission requirements. With these challenges, there lies a clear need for claims lifecycle focus that includes accuracy and timeline emphasis. Claims automation ensures an end-to-end process that addresses all touchpoints of complex claims—to avoid costly rework and reputation-damaging penalties. With optical character recognition (OCR) addressing much of the data capture, there is significantly enhanced data integrity. Additionally, any labor-intensive manual intervention needed is decreased.
- Improved financial performance: Aside from reducing financial penalty implications, claims automation is proven to tighten turnaround times. Per the CAQH research, use of electronic transactions for a single medical claim requiring all seven business transactions benchmarked by the Index could save a provider practice almost 40 minutes on average – plus more than $15 in direct cost savings. And the bar has been raised for payment—with a 5-day payment goal is increasingly common. With discounts in the offering for meeting these measures, automation is worth the investment.
- Decreased provider abrasion: Poor claims adjudication can strain payer-provider relations to the breaking point—resulting in physician/provider attrition, member attrition, and lost revenue. With faster payment and fewer resubmissions, claims automation drives improved provider experience, with fewer escalations. Undoubtedly, analytics and automation have been key tools in driving today’s in-demand B2C focus for the payer-provider relationship while being integral to NPS and CSAT score improvement for both the provider and the member.
The increasing use of claims automation is fundamentally changing healthcare. Business process outsourcers (BPOs) can make a significant difference in all of these next-frontier areas. As true automation experts, these partners provide keen familiarity with a client partner’s business processes, strong operational metrics strategy, and holistic alignment to long-term business interests.