Insurance products have become more complicated, but eligibility and benefit validation have not caught up to the complexity.
The idea of validating eligibility has been around as long as the health insurance business. It answers the very specific question of whether or not the patient is insured by the entity they claim to be insured by. As health insurance evolves, new data becomes critical to obtain to ensure accurate billing by providers and payment by insurers.
Each insurer has anywhere from a few to hundreds – if not thousands – of products offered to individuals directly, through employers, state Medicaid programs, or by the federal government.
These insurers are required by mandate to offer an electronic HIPAA-compliant transaction to validate eligibility. Though most of them offer a HIPAA-compliant 270/271 transaction, some are still hiding behind exceptions. Others have non-compliant third party vendor solutions.
Conversely, all electronic medical record (EMR) and practice management (PM) systems offer an eligibility validation module often used during the appointment scheduling process or at check-in at the provider office or medical facility. But, due to the complexity of the insurance products and the lack of standards from the electronic data interchange (EDI) compliance agencies, the EMR and PM vendors can’t keep up with the variety of responses. They tend to opt for a simplified view into eligibility that strips the data to a bare minimum of eligible versus. ineligible, along with some demographic and accumulator data.
To add to the complexity of eligibility, especially when we look at Medicaid and Medicare-eligible patients, is the coordination of benefits (COB) aspect of insurance coverage. Unlike subrogation, which is triggered by specific diagnostic procedure codes, COB data is difficult to obtain and maintain. This is because the patient has to remember to mention it either during scheduling an appointment, at the time of check-in at the medical practice location, or during enrollment with the insurance company.
The industry has built massive workaround solutions to cope with this COB problem. Other challenges, like narrow networks and accountable care organization ZIP code/region-based contracts, create even bigger challenges for providers and insurers as more transient populations can change the nature of the eligibility question weekly if not daily.
All of this is important because:
- It affects payment amount and source
- It impacts the medical treatment in some cases because of pre-authorization rules for medications and treatments
- In some cases, it may force unrecoverable cost of treatment for a medical practice
Insurers can help improve this situation by:
- Ensuring the product configuration team and EDI team are following the same protocols, and updating their 270/271 capabilities to support as much automation as possible
- Emphasizing the importance of collecting COB data during open enrollment and any member encounter with their customer services team
- Publishing their 270/271 standards to make it easier for the software vendor to integrate capabilities into the EMR and PM systems
- Implementing 270/271 support
Providers can protect themselves from financial loss and improve patient/customer satisfaction by:
- Asking EMR and PM vendors to invest in supporting as much data as possible into the eligibility and benefit modules of the software
- Contacting their local insurance companies to ensure compliance and support for 270/271 transactions
- Training scheduling staff to ask for COB data and any other necessary insurance information during appointment scheduling
- Training their check-in/intake teams to validate this data and fill any gaps missed by the scheduling team
- Verifying eligibility information prior to submitting claims to ensure correct payment
Improving the customer experience for members and patients while eliminating the need for chasing after information and correcting issues after the service has been delivered is the true value to any eligibility or validation program.
Hanny Freiwat is Senior Director of Product Innovation for HMS.