The massive amount of administrative waste, claims inaccuracies, fraud and abuse in Federal health care programs can cost taxpayers billions of dollars while putting beneficiaries’ health and welfare at risk. Employers and others who pay for healthcare premiums are additionally burdened with the excessive costs incurred by the current broken and inefficient system. Waste is particularly rampant, and all sectors of the healthcare system contribute to its excess.
THE PROBLEM
The exponential growth of costs in healthcare remains a serious and ever-evolving problem in the United States. Nearly $4 trillion is spent on healthcare annually, with administrative spending accounting for approximately one-quarter of that total.
It is estimated that a third or more of healthcare spend annually may be wasteful, with up to one-third of this wasteful spending directly tied to administrative complexity as well as the costs associated with healthcare claims integrity processes and revenue cycle management -- the financial processes that payers, facilities, providers and vendors use to manage the administrative and clinical functions associated with claims processing, payment, and revenue generation.
This trend is currently cascading into the wrong direction, towards a healthcare spending estimate of $6.2 trillion by 2028 and towards the unchecked continuation of skyrocketing costs caused by healthcare waste and claims inaccuracies. It is clear that significant changes must be made to how healthcare financing is managed.
COMPLEXITY AND CONFLICT
The healthcare system in the United States is a highly complex system made worse by the multiplicity of payers and their separate sets of edits, and by the lack of transparency in the rules and processes they use for processing payment for services. The disclosed rules exceed a million code pairs for a single payer, and there are millions of unique code pairs across the many payers with which a provider may be contracted. Outside of Medicare, the actual size and scope of a payer’s library of edits is generally unknown to the providers.
It is easy to see why a universal solution for inaccurate payments and incorrect claims has been elusive.
One study found that an estimated 80% of medical billing costs stem from the multiplicity of payers.
Each of the many payers in the U.S. have increasingly complex, specific claims processing, reimbursement models, and code sets that are rarely fully transparent to providers and vendors, driving additional losses from inaccurate claims submissions and claims denials.
There is a significant increase in overhead created by the multiple vendors maintaining closed solutions that do not allow for sharing their edits with other vendors. This requires the payers to have to verify the accuracy of those edits by sampling them, as well as to ensure that there are no overridden edits.
This also creates an expensive, time-consuming cycle for payers having to merge multiple claims edits from multiple vendors, and vendors and providers having to process far more appeals and re-appeals.
The administrative costs for payers also increases dramatically due to the number of inaccurate edits and the protracted appeals process, as does their having to work with the multiple payment integrity vendors.
U.S. payers also have complex and varied payment models, complicated by ever-changing compliance requirements and frequent industry changes to code sets and guidelines, CMS policies, accentuating the lack of consistency across lines of businesses like Medicare, Medicaid, commercial and self-insured plans.
The complexity and time requirements of the current payment integrity system have caused a high dependency on technology to keep up with all the changes and have resulted in a “black box” scenario of no transparency amongst and between current vendors.
Despite generations of advancements in technology, productivity and quality have stagnated in the US healthcare system, and change continues to be slow. The current system is clearly fragmented, duplicative, and dysfunctional.
WHAT, THEREFORE, IS THE SOLUTION?
McKinsey & Company found that applying interventions to the "financial transactions ecosystem (claims processing) by streamlining the claims submission process through simplified provider platforms" as well as "leveraging new technologies such as analytics and cloud computing" could save approximately $175 billion which equates to 18% of the total administrative spending.
This reinforces the belief that the current healthcare payment system must be replaced by one in which health insurance claims payment and other administrative processes are transparent, simple, and unambiguous, one that would allow for automated, real-time transactions and the ultimate elimination of tedious manual processing and outdated legacy technology.
Healthcare leaders could significantly decrease the complexity and waste that is attributed to payment integrity and revenue cycle management by championing the streamlining and democratizing of the claims processes.
The Power Of One: One Vision, One Solution
In a perfect world, a single open system focused on ease of use, universal functionality and transparency would reign as the ideal collective goal of the American healthcare system.
As with the universally familiar open user systems in the technology world today, a single claims integrity platform built on a solid foundation of cooperative and shared construction could result in an effective, cohesive and easy-to-use system that would benefit payers, RCM and EHR vendors, clearing houses, payment integrity service providers and patient care practitioners alike.
There would be faster innovation and release cycles, full transparency, less waste, and less friction between providers and payers.
The silos that cause disconnected data between departments within organizations would be eliminated -- transformed into a single source -- and everyone would have access to the same information in real-time, reducing errors and streamlining processes.
The open share claims Integrity platform just described is not a future hope or just a pipe dream.
It’s a present-day reality created by the founders of CoverSelf, whose singular vision and next-gen innovation stand as the fabled David facing off against the imposing Goliath which is the current U.S. healthcare financial system.
Like David, CoverSelf knew that they – with their strong belief, courage and commitment – could meet the challenge they faced when confronting healthcare fraud, waste, and abuse and take it down with a relatively lightweight, targeted solution.
They have laid out the foundation for a powerful, singular cloud-based, domain-specific platform to benefit all healthcare stakeholders, reducing administrative waste, decreasing friction between payers and providers, and accelerating accurate claims and payments by using first pass claims edits and a robust and easily customizable rules engine that delivers additional value through the reduction of preventable denials, the capture of missed revenue, and acceleration of payer payment.
Providers and payers alike will no longer feel that they are fighting a losing battle to gain and maintain control over their payment systems and their revenue cycle.
The platform is intelligently and intentionally constructed for ease of use and exceptional functionality, with dashboards and rules libraries to customize and track all claims integrity systems.
Innovation will be fostered due to its open nature for continued improvement and universal application. Collaborative developers’ work can overlay the foundation set by CoverSelf without the complexity and restrictions inherent with APIs.
It is easy to see that the power of one, simple to use, cloud-based, universal solution can significantly reduce the fiscal waste that is currently rampant in the U.S. healthcare system and will streamline the management of healthcare claims for all stakeholders, resulting in less time spent and less money lost.
A surprisingly simple yet major win system-wide, from payers to patients.
Now that’s one powerful solution.
