More than zero

In­surer-provider com­mu­ni­ca­tion builds trust

Modern Healthcare - - From The C-suite - Juan Dav­ila is se­nior vice pres­i­dent for net­work man­age­ment at Blue Shield of Cal­i­for­nia.

When pay­ers and providers sit down to talk, all too of­ten the scene re­sem­bles gun­slingers from the Old West siz­ing each other up. Af­ter the small talk, each side works hard to ne­go­ti­ate bet­ter rates from the other. Words such as “trust” and “shar­ing” are no­tice­ably ab­sent. Both par­ties fre­quently see the ne­go­ti­a­tion as a zero-sum game: One side’s gain is the other’s loss.

This is frus­trat­ing for every­one, and I al­ways wished there was a bet­ter ap­proach. So a lit­tle over a year ago, my com­pany— Blue Shield of Cal­i­for­nia—ini­ti­ated a new pro­gram with 14 hos­pi­tals in our net­work. We called the new pro­gram Part­ner­ship in Op­er­a­tional Ex­cel­lence and Trans­parency, or POET. Our goal was to im­prove our re­la­tion­ships with par­tic­i­pat­ing hos­pi­tals by bring­ing some trust and open­ness into the equa­tion. To do it, we fo­cused on im­prov­ing claimsper­for­mance trans­parency. We had a hunch that all par­ties would ben­e­fit if in­for­ma­tion could be shared in an ac­ces­si­ble, sim­ple for­mat. We were right. When we launched the POET pro­gram, we be­gan with good in­ten­tions and a pow­er­ful Web-based an­a­lyt­ics por­tal we built with MedeA­n­a­lyt­ics, Emeryville, Calif. This por­tal al­lowed us to openly share claims in­for­ma­tion with our part­ner hos­pi­tals. We shared claim cy­cle time (from dis­charge to claim pay­ment), sub­mis­sion method (pa­per vs. elec­tronic), de­nial vol­ume, ap­peal vol­ume and out­come, and Blue Card claim vol­ume. This en­abled par­tic­i­pat­ing hos­pi­tals to log in to the por­tal to ac­cess their own claims and re­view im­prove­ment op­por­tu­ni­ties jointly with Blue Shield rep­re­sen­ta­tives dur­ing quar­terly meet­ings. Mid­dle man­age­ment and staff who han­dle a hospi­tal’s pa­tient fi­nan­cial ser­vices would par­tic­i­pate, as would ex­ec­u­tives from their con­tract­ing of­fice. We de­signed it so that hos­pi­tals could go live on the por­tal in as lit­tle as a week.

In ad­di­tion to im­prov­ing claims-per­for­mance trans­parency with hospi­tal part­ners, POET also gave us clearer in­sight into our own ad­min­is­tra­tive per­for­mance and re­spon­sive­ness to hospi­tal com­plaints. With claims data dis­persed among mul­ti­ple sys­tems, it was dif­fi­cult for the users to ac­cess and sys­tem­at­i­cally share in­for­ma­tion. POET helped us to bet­ter un­der­stand and re­solve claims dis­putes, pay­ment dis­crep­an­cies, au­tho­riza­tions, case man­age­ment and prac­tice pat­tern vari­a­tions—all of which re­duced ten­sion and costs.

By ad­dress­ing re­im­burse­ment is­sues at their root causes and pro­mot­ing ad­min­is­tra­tive ef­fi­ciency through short­ened cy­cle times and in­creased first-pass claims pro­cess­ing, we’ve re­duced the time it takes to pay a claim by two days.

That adds up to real money. Price­wa­ter­house­Coop­ers noted that of the $1.2 tril­lion wasted in the en­tire U.S. health sys­tem each year, $210 bil­lion of that waste is a re­sult of in­ef­fi­cient claims pro­cess­ing—the sec­ond-largest area of waste. By re­duc­ing un­nec­es­sary claim re­work, POET-en­abled hos­pi­tals have al­ready ex­pe­ri­enced a 15% re­duc­tion in claims de­nials. One hospi­tal in Or­ange County ex­pects to see a 32% de­crease in to­tal de­nials and a 54% de­crease in de­nied dol­lars. This is ex­actly what we were hop­ing to see.

Con­tract talks are go­ing more smoothly, too. Since hospi­tal con­tract­ing ex­ec­u­tives can now see all the data shar­ing and col­lab­o­ra­tive work that hap­pens, we no longer have as much of the fin­ger-point­ing over claims dis­putes that we used to ex­pe­ri­ence dur­ing ne­go­ti­a­tions. Plus, we’ve been able to sim­plify some of our con­tract­ing lan­guage—some­thing we can all ap­pre­ci­ate.

Now that POET has proven it­self worth­while, sev­eral providers that ini­tially im­ple­mented the pro­gram on a lim­ited ba­sis are now rolling it out to more hos­pi­tals. We ex­panded the pro­gram be­yond the nearly 100 hos­pi­tals that are POET-en­abled.

De­spite all the un­cer­tainly over the fu­ture of the Amer­i­can health­care sys­tem, one thing is for sure: In­sur­ers and hos­pi­tals will con­tinue to ex­pe­ri­ence im­mense pres­sure to re­duce costs. The old par­a­digm—of pay­ers and providers work­ing against each other— won’t de­liver the re­sults we need. Part­ner­ships like POET rep­re­sent a smarter way of do­ing busi­ness.

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