Commercial payers can be inconsistent with reimbursement processes, which can lead to a significant administrative burden for your practice.
Of additional concern in this area, commercial payers vary in their requirements for descriptions of procedures. For example, some carriers want several procedures bundled into one code, while others want certain modifiers added. The burden here is the lack of a logical pattern to these descriptions, and that requirements can vary significantly by payer and locale. Moreover, some commercial payers refuse to pay for common preventive procedures, such as immunizations. An example of this is that tetanus shots often are not reimbursed.
When an insurance company reviews a claim, physicians expect the reviewer to be a trained and experienced clinician. This is not always the case, however. When medical practices deal with higher-level representatives of commercial payer companies, such as a medical director, it can become evident quickly that much of their experience lies in the bureaucratic end of the business, so they have little understanding of the clinical and acute care sides of medicine.
A further concern regarding bureaucracy is that commercial payer responses vary greatly depending on the person with whom a practice is in contact. While some subjectivity is natural for complex cases, situations that appear black and white to the physician often elicit different answers based on the person or the office dealing with the claim. This lack of consistency in responses is further exacerbated by the fact that it is often difficult to obtain documented payer rules, which would be extremely valuable to physician practices.
Commercial payer response times also vary significantly between companies, which means that the physician's office must adjust its expectations for payment, answers to questions, and appeals by individual payers. Little wonder that, according to the Sermo Physician Sentiment Index, more than 90% of physicians say that getting paid by insurers has become increasingly burdensome and complex.1
NEEDED: UNIVERSAL PAYMENT METHODS
In recent years, many physicians have begun calling for a single, universal payment method and process to streamline and simplify the reimbursement system. Despite industry standards, each insurance company's claims have variations. Thus a disclaimer commonly found on claim submission guidelines reads, "Following the recommendations in this guide does not guarantee payment, as claim submission rules and policies vary by insurance carrier."
It's easy to understand this arrangement from the insurance companies' perspectives. They must operate at a profit, and the best way to do that is by minimizing payouts and maximizing income. In reality, however, the savings realized from reimbursing for standard procedures would benefit the payer and the physician.
The hope among physicians is that electronic health records (EHRs) will address many of these issues. While electronic processes have been phasing in over the past 20 years,2 much room for improvement remains. The consulting firm McKinsey & Company estimated in 2007 that the healthcare payment system consumed at least 15% of each dollar spent on healthcare, versus only 2% in the retail sector.3
Since physician documentation for a claim is central to the type of claim and the amount to be paid, EHRs can help if they provide cleaner documentation or easier access to it. Many experiments are under way for different payment mechanisms, such as accountable care organizations (ACOs) and medical homes. These arrangements will almost certainly require some form of EHR system, since information about patient outcomes must be linked to reimbursement. The fear is that they could further complicate today's overly complex reimbursement process.