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Transcript of How ACA Administrative Simplification Rules Can Improve Cash and Productivity Presented by: Ken...
How ACA Administrative Simplification Rules Can Improve
Cash and Productivity
Presented by: Ken Bradley
Vice President, Strategic Planning Navicure
Agenda
PPACA Overview
Operating Rules
Timelines
Eligibility Rules
Remittance and EFT Rules
Practice Benefits
2© 2013 Navicure, Inc.
PPACA: More Than You Might Think
The Patient Protection and Affordable Care Act (aka ACA )
Most public discussion around expansion, individual mandate and exchanges, but there is more.
Besides its goals of improving quality and expanding access are ones of controlling costs and making healthcare affordable.
3© 2013 Navicure, Inc.
ACA Components (well, some)
Creates the State Health Benefit Exchanges and defines benefit packages
Creates ACO demonstration projects Expands fraud and abuse/compliance efforts Potentially expands Medicaid (dramatically in
some states) Requires expansion of quality metrics and
their use Contains language attempting to further
automate the business of healthcare
4© 2013 Navicure, Inc.
Automating Healthcare Administration We’ll focus on just 9 pages of the ACA Remember HIPAA? ACA dramatically
extends and expands it. These 9 pages contain two sections
addressing “Administrative Simplification” Section 1104
Creates “Operating Rules” framework Section 10109
Worker’s Comp Edits and payment rule transparency
5© 2013 Navicure, Inc.
High U.S. Insurance Overhead: Insurance-Related Administrative Costs
Fragmented payers + complexity = high transaction costs and overhead costs
◦ McKinsey estimates adds $90 billion per year*
Insurance and providers
◦ Variation in benefits; lack of coherence in payment
◦ Time and people expense for doctors/hospitals $76
$86
$140$191$198
$220$247
$516
$0
$100
$200
$300
$400
$500
$600
US FR SWIZ NETH GER CAN AUS* OECDMedian* 2006
Source: 2009 OECD Health Data (June 2009).
Spending on Health Insurance Administration per Capita, 2007
* McKinsey Global Institute, Accounting for the Costs of U.S. Health Care: A New Look at Why Americans Spend More (New York: McKinsey, Nov. 2008).
6© 2013 Navicure, Inc.
Inefficiency Costs (a lot!) National Academy of Sciences/Institute of Medicine
$2.6 Trillion spent, about $260 Billion administrative Excess is estimated to be $168-183 Billion / year
Wasted dollars by category: Unnecessary services - $210 B Inefficiently delivered services - $130B Excess administrative costs - $190B Prices too high - $105B Missed prevention opportunities - $55B Fraud and abuse - $75B
7© 2013 Navicure, Inc.
Likely Affects You One estimate of the affect on practices
$247,500 / year on unnecessary / redundant admin tasks
$19,444 / year on phone calls with pharmacies $38,761 / year on verifying patient coverage manually $9,248 / year on resubmitted denied claims
Source: National Academy of Sciences/MGMA
Physicians today spend about 43 minutes a day (3 weeks a year) interacting with health plans Time not spent on patient care
8© 2013 Navicure, Inc.
Consistency and Standardization
What if: You were able to receive detailed, consistent benefit
info from payers; and payers used remittance and remark codes
consistently for common denial scenarios; and EFT and ERA were available and enrollment was the
same for all payers? You could reduce costs!
The ACA provides a new framework to address many of the reasons for needing to do things manually as well as requirements for more detailed and accurate information.
9© 2013 Navicure, Inc.
Operating Rules – Dealing with Inefficiency
New concept introduced with ACA’s Section 1104 Allows for the creation of additional business rules
and guidelines for the electronic exchange of information
Wherever there is a reason for not 100% automation (no paper or manual processing), Operating Rules may be developed to address
What prevents 100% automation? Letting various trading partners…
“interpretation” the standards where it lets them define transmission methods, acknowledgment format use defined standards in inconsistent ways from everyone else
10© 2013 Navicure, Inc.
The Goal: Automation
CORE/CAQH
11© 2013 Navicure, Inc.
ACA, HIPAA and Operating Rules
ACA provides for the creation of Operating Rules to enhance existing or create new standards, but not replace existing ones
All existing HIPAA standards are the foundation: 837 Claim 835 Remittance
But, there are new ones: 275 Attachments CCD+ NACHA transaction used by banks
12© 2013 Navicure, Inc.
ACA, HIPAA and Operating Rules
Operating Rules go farther than typical standards: Data content, definitions, how to use Required information Consistent use of codes in defined business
scenarios Transmission standards Security requirements Response timing Exception reporting Eliminating interpretation … anything that prevents 100% automation
13© 2013 Navicure, Inc.
Operating Rule Scope
May address ANYTHING that inhibits automation, where data doesn’t flow consistently among various healthcare trading partners
14© 2013 Navicure, Inc.
We’ve Heard All This Before, Haven’t We?
The difference this time: Single word: Certification Health plans are required to attest they are following
the rules, or they will face penalties. First set of implemented rules began January 1, 2013. Health plans should have submitted attestation
document to CMS by December 31, 2013. HHS will assess possible penalties by April 1, 2014.
Penalties: $1 - $20 per day, per covered life with failure to
be in compliance Doubled if knowingly inaccurate, incomplete
15© 2013 Navicure, Inc.
Timeline
Jan 1, 2013• Eligibility• Claim Status
Jan 1, 2014• Remittance• EFT
Oct 1, 2014• ICD-10• Health Plan ID
2015
Jan 1, 2016
• Claims• Plan Enrollment / Disenrollment• Referral Certification /
Authorizations• Attachments
16© 2013 Navicure, Inc.
Eligibility Operating Rules January 1, 2013 brought several new eligibility
requirements: How to handle patient prefixes and suffixes like MRS,
MR, MD, II, JR Prefix/suffix should be removed before attempting lookup
Consistent and defined error reporting requirements “AAA” 5010 specifications, e.g., “71” = Patient DOB doesn’t
match Response times for both batch and real-time
inquiries 20 seconds real-time and next day for batch
System availability e.g., minimum 86% availability per week
17© 2013 Navicure, Inc.
Eligibility Data Requirements
Payers are required to return details: Much needed critical information was defined in
5010 as “highly recommended” where the Operating Rule now requires them
Health plan name required Past (up to 12 months) and future eligibility dates In and out-of network variances Remaining patient deductible amounts Static patient responsibility amounts: co-pay, co-
insurance Generic inquiries (type 30), must have plan name
and patient financials for each required service type returned
18© 2013 Navicure, Inc.
Remittance and EFT Operating Rules
Required implementation: January 1, 2014 Adds new transaction – the CCD+ to the HIPAA
list of transactions to allow bank deposit reassociation with 835 remittance data Bank deposit data will contain the 835 remittance
advice tracking number Requires defined claim adjustment reason and
remark code combinations for common reasons services are not paid
EFT & standardized and electronic EFT enrollment Rule # 380
19© 2013 Navicure, Inc.
Remit Reason/Remark Use
Defined business scenarios1. Additional information required
2. Missing/invalid/incomplete data from submitted claim
3. Billed service not covered by health plan
4. Benefit for billing service not separately payable
20© 2013 Navicure, Inc.
Additional Information Required
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Missing/Invalid/Incomplete Data
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Billing Service Not Covered
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Not Separately Payable
24© 2013 Navicure, Inc.
Expected Benefits of the Operating Rules
Look for Operating Rules to: Eliminate inconsistent data usage Define missing or unclear usage instructions Create transmission, format and system
availability expectations
Resulting in less: Variation in business operations from payer-to-
payer Manual processing Guessing about what is needed and how processes
should work Money spent on administrative costs!
25© 2013 Navicure, Inc.
Time to Take a Look at Your Revenue Cycle
With these new rules, it’s time: If you are not currently doing automated
eligibility, now is the time to consider.
If you are not currently using remit and EFT, now is the time to consider doing both.
26© 2013 Navicure, Inc.
Automation (Done Correctly!) Helps
Source: Milliman, 2006
27© 2013 Navicure, Inc.
The Benefits Keep on Coming Automated, Consistent and Accurate
Transactions Improve operational costs
Help reduce denials Eligibility changes show a 10-12% reduction in denials Faster secondary and patient billing cycle
Improve denial management Standardized understanding of payment reductions
Improve analytics Standardization allows apples-to-apples comparison
Permit accurate and point-of-service patient collections
28© 2013 Navicure, Inc.
Conclusion: Improve Your Bottom Line
Automate: Eligibility $3.70 manual v. $0.74 electronic Remittance and EFT $2.96 manual v. $1.48 electronic
Reduce denials: Use eligibility data to file accurate claims and
begin point-of-service patient collection AMA: 21% of claims need follow-up Costing $14-$25 for each follow-up
29© 2013 Navicure, Inc.
ResourcesCore Phase III Rules: EFT and ERAhttp://www.caqh.org/CORE_phase3.php
ACA Timelinehttp://www.healthcare.gov/law/timeline/index.html Kaiser Foundation – state level activity (e.g. State Benefit Exchange status)http://www.statehealthfacts.org/index.jsp
American Health Information Management Association (AHIMA) Operating Rule Overviewhttp://library.ahima.org/xpedio/groups/public/documents/ahima/bok1_049348.hcsp?dDocName=bok1_049348
The Daily Practice Blog – www.dailypracticeblog.com
30© 2013 Navicure, Inc.
Ken BradleyVP of Strategic Planning
770-342-0210Twitter: @Ken_Bradley
31© 2013 Navicure, Inc.