As payers and providers work together to face the financial storm created by the coronavirus pandemic, they are operating in an environment with little room for increases in provider rates or health insurance premiums.
One step payers and providers can take to make things better is to reduce the administrative costs that result from inaccurate and late claim payments, by improving provider data management (PDM). Too often, payers have incorrect or incomplete information about a provider, or no information at all.
New technology can help solve this problem, and increase the speed and accuracy of the payment process.
For providers, that can mean reduced administrative burdens, improved satisfaction, and an offset for some of the financial impact of COVID-19.
For agents and brokers, PDM technology matters, because anything that reduces providers’ administrative burdens can help improve the quality of care while helping to hold down increases in spending.
Why Focus on Provider Data Management?
A hospital system and a payer may have millions in disputed claim denials. These disputes affect one in every 10 claims. For the hospital system, resolving the concerns leads to high administrative expenditures .
Opaque payment policies, changes in authorization requirements, and updated benefits are commonly perceived drivers of denials. However, the payer’s management of provider data is increasingly driving payment errors, especially with the mergers, acquisitions and growth of physician groups, delegated physician entities and independent physician associations.
One of our colleagues, Erica Nelson, a director in AArete’s healthcare payer practice, has described the problem this way:, “The rapidity of changes affecting physician groups has had an astronomical impact upon payers and their ability to pay claims timely and accurately. As a result, payer/provider relationships can be unnecessarily strained due to increased volumes of pended claims, late payments, appeals, post-pay adjustments, and sanctions.”
One solution is provider data management automation.
How PDM Works Now
PDM consists of the information, processes and systems required to manage the provider network. Payers use provider data to communicate network participation to health plan members, validate credentialing, and configure adjudication systems to reimburse providers based upon contracted rates. The resulting provider data is housed across many different, separate systems, and the data formats in these systems — including the PDM, adjudication, provider directory, contract repository, and credentialing systems — are often inconsistent.
Gaps or errors in provider information are sometimes identified quickly. Other problems may go undetected over long periods of time. A physician might be missing from a roster. A practitioner may be inadvertently overlooked by the credentialing department. An NPI may not be aligned with other providers practicing under the same taxpayer identification number and in the same network. One provider may have duplicate entries with different participation and contract identifiers.