THE EFFECT OF PROVIDER ABRASION ON CONTAINING
Cooperation will allow for a tremendous improvement in identifying previously hidden claim mispayments by health insurers. Will plans stand firm on provider obligation, initiate détente or be paralyzed by fear?
By Stephen Ambrose
Provider Abrasion (PA)
Function: noun
Etymology: Medieval Latin “pro” / “videre” / “abrasio”
Definition:
1. Disconcert of contracted hospital, health system, physician or medical service company, stemming from actions proposed or taken by a related health plan.
2. Anger and intimidation utilized from providers and their administrations, limiting ability of health plans to perform necessary operations.
3. Mad medical professional, perturbed PPO, angered ancillary provider.
SEE intimidation, leverage of patient / plan participant relationship, disharmony, lose-lose proposition.
You won’t find the term ‘provider abrasion’ in Webster’s, Roget’s or even with a Google search. GoDaddy won’t have the .com name available (permanently shelved by yours personally) and it certainly has not been a widely discussed or written about topic, during our country’s healthcare reform activities in the last eighteen months. Imagine any healthcare activity in our country that still remains blog free.
For many VPs and C-level executives in plan and PPO provider relations, PA can sometimes create the very fear of God. Say the ‘PA-word’, even jokingly, to those whose job is to manage relationships with their contracted hospital and outpatient providers. Casual conversation can tighten up, shoulders tend to straighten up and backsides could at times yellow up. PA has become an anxiety-ridden buzzword that even extends to TPA/cost containment/subrogation vendors and PPO plans. In speaking to a number of vendor presidents and senior VPs, many have shuddered at the possibility of asking their asking those in their provider networks to perform any additional administrative activity, even if it’s a current contractual obligation.
It is estimated that each year, many billions of dollars are unnecessarily transferred from our battered healthcare system to injured parties and their attorneys. The utilization of ‘double-dipping’ is a slang term, denoting when injured parties and their attorneys submit, as a part of their claim, previously-billed and paid healthcare billings, to a liable third party payer. This allows for greater compensation for both the attorney and the injured party, and is covered by a rule of law known as the Collateral Source Doctrine.
On the other side of the equation is the plan’s ability to enact Coordination of Benefits and when known, recovery of mispaid claims through subrogation. These are useful and necessary tools, as most states have no provision for injured plan participants or attorneys to proactively volunteer the existence of a filed injury claim to client health plans. Therefore, the plan uses existing information to follow up on largely indirect data and hopefully gain the help of the plan participant in truthfully coming forward to acknowledge intent, from an inquiry letter they received.
Cost containment, specifically identifying mispaid claims is a health plan operation, which has traditionally been hampered by a clear limitation of data. Nowhere is this more prudent than in the areas of third party liability (TPL) and Coordination of Benefits (CoB), which are the reactive and proactive portions of claim mispayments to providers. Specific to the area of TPL is the necessity of not only identifying mispaid claims, but being able to affect recovery of these monies back to the plan, when applicable.
Typically, claims data allows plans and their vendors to be introduced only to the possibility of an injury claim through provider submission. These are generally limited to auto or work claims, and leads or their claim vendors to subsequently send out generic inquiry letters to, as well as placing a high level of dependence on those participants to volunteer substantiation of claim action. Moreover, the primary use of front end claims data as the main marker of present and future claim mispayment doesn’t include hundreds of billions of dollars transacted annually through medical malpractice, product liability, class action and other non-auto/work causes.
ROI request data is a revolutionary and far improved marker for identifying plan participant intent to file third party claims. It is not designed to solely replace current plan and vendor claim analysis, but to improve on its limitations, speed and accuracy.
ROI Request Data – A Necessary Innovation
Release of patient information (ROI) is an operation conducted between a health provider and a requesting party. According to the Association of Health Information Outsourcing Services (AHIOS), fulfillment of patient ROI requests is a process outsourced by hospitals and health systems more than 60% of the time.
Fulfillment of ROI patient requests bring providers and vendors .25 and $1.00 per page for fulfilled; for some fulfilled ROI requests, there is no financial reimbursement. Reimbursement levels depend on individual state law, nature of request made and the party who is requesting the information. Surprisingly, most hospitals and large physician groups don’t pay their ROI fulfillment vendors any money, but rather let the vendors collect solely from the requesting party. In some cases, the vendors actually split reimbursed monies with the client!
Estimates put patient record requests at more than 20+ million annually. Parties who request patient information include other health providers, life insurers, attorneys, social security departments, disability plans, worker’s compensation divisions, law enforcement, P&C carriers and the patients themselves.
A small, transactional portion of ROI requests is known as ROI request data. This is a new and innovative electronic data medium, which for the first time creates a telling transparency between the record department of providers and the health plan claim operations. For many reasons, ROI request data is far superior to front end claims analysis alone, when detecting plan participant involvement in an injury claim. The information is direct and common to all types of injury and liability claims; best of all, it doesn’t lend itself to false positives and wasted time in dead-end sending letters and unduly placing significant dependence on plan participants for responses.
ROI request data begins with a small piece of information, typically a faxed/emailed ¼ page form with copied request, which comes from the record departments of health providers nationwide. This information, which is taken only from requests made by lawyers and the patients themselves, notes the patient name, a small amount of non-financial, non-condition demographics, as well as the requesting party’s name.
If the patient is requesting a release of their own information, the patient notes whether or not they are using the requested information for a present or future injury claim. Furthermore, there are no billing or treatment notes included on an ROI request data submission.
‘Future Plans’ of the Plans
In the majority of health plan–provider agreements, there is currently an obligation of the contracted provider to supply the plan with any known information on their patient, when such an individual, who is also a plan participant, may have had an injury, accident or circumstance relating to the pursuit in filing an injury claim. Plans obligate and rely on providers to forward such information when known, because in many cases it’s the only way for a plan to even know where to start, when identifying mispaid and wasted claim payments.
ROI request data falls squarely under this contractual provision and greatly improves the speed and accuracy in identifying ONLY those injuries or accidents where the plan participant is taking claim action themselves or with an attorney. However, in requesting providers to submit ROI Request Data, the plan is asking their network providers to fax or email a new piece of data. Although the record department or ROI vendor already has the patient information out for ROI request fulfillment, it is an extra step.
For the first time in many years, there is a major innovation in differentiating and identifying plan participants who are definitively pursuing injury claims. Provider relation departments of plans are not typically linked to claim cost containment. However, this is a time where new data and new tools must be utilized to bring results to plans and their attached dependents. We won’t go into Einstein’s definition of insanity, but for the uninitiated in plan cost containment, it’s worth learning.
Perhaps tort reform is not a realistic solution or attainable in its very nature. But tort transparency can be had and may be a tremendous step in the right direction. The ability for existing plan participant intent and fault information to be transparency to health plans and their vendors, levels the playing field. In turn, this delivers necessary innovation to the free market forces surrounding claim operations in our healthcare plans.
A deterrent for nuisance claims? Exposing the current inefficiency in cost containment today? Plan participants hiding involvement by either not answering or falsely answering plan and vendor inquiries? Filing an injury claim, submitted months after a negative reply on inquiry? Because ROI request data is a ubiquitous data point, consistent in most every injury claim, many gaps left in today’s operations can now have speedy and more accurate information to work from.
How does this affect providers? It could be argued that sending ROI request data can at times limit payment from plans to providers. In some cases, plans would in fact withhold, stop or recover payment. But it’s not the provider’s money to begin with, and the plan is already taking restrictive claim payment measures, when known. Moreover, it cuts both ways as many providers are stopped out or delayed on timely payment due to CoB provisions. The sooner the plan knows of participant intent, the sooner the restriction for payment may be lifted and the provider paid.
Which plans will utilize ROI request data in their operations? How many newfound claims will be discovered? Will recoveries be higher and easier to capture? Will plans re-categorize their existing vendor rate schedules for ROI request data passed on? Is a plan not using this information shirking its fiduciary and contractual responsibilities to shareholders and those depending on the financial health of a plan for their financial health too?
In order to gain such improvement and transparency, plans must choose to hold their providers and the ROI fulfillment vendors working for providers, accountable to submit ROI request data to contracted health plan. Do the provider network departments have the courage to stand by what they now request from providers? Will the ROI request data be valued? Will plans pay providers for ROI request data? If they do, will it mirror existing request rates or be a stable fee? Could participation be mandated against consider of future provider reimbursement levels?
Health plans…the ball is now in your court.
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