The comp industry spends millions on utilization review – certifying a procedure, hospital stay, therapy, or treatment as ‘necessary’ – or not. What most payers don’t realize, or, more correctly, probably realize and don’t discuss, is the reality that their UR systems are not linked to bill review platforms, so if the procedure/therapy/treatment is delivered and billed, in far too many cases it is paid.
That’s not to say payers don’t spend a lot of time, resource, and effort trying to link UR and BR, but the ‘link’ is largely manual, requiring bill review processors to stop what they’re doing, look at (in many instances) a different software application or database, interpret the free form text, and manually enter payment recommendations and explanation codes.
Which is a waste not only of administrative effort, but medical dollars as well.
I’d long heard about this, and seen it in many of the audits of managed care programs my firm conducted, but until I surveyed most of the largest payers in the nation last year I didn’t fully grasp how pervasive this is. (if you want a copy of the survey do not leave a comment to this post, rather email infoAThealthstrategyassocDOTcom)
The problem
The current challenge facing all bill review application vendors is a limited ability to interface with UR software products in general. Most UR software platforms capture their decisions in a narrative form, in text or free-form fields. Therein lies the problem; UR decisions must be capable of being placed in a file format that computers can recognize. Moreover, each payer has their own unique approach, set of UR guidelines, interpretation of state UR rules, and customer requirements, making the integration of bill review and UR doubly difficult.
Potential solutions
Now two bill review companies are working to address that problem. Mitchell, which markets the SmartAdviser application, will be releasing an internally-developed service, entitled Utilization Review Decision Manager, that is designed to automate the feed of utilization review determinations. The idea is to enable customers to auto-adjudicate bills and individual services that up till now people had to research and authorize manually. The new app is slated to be on the market in July of this year; it is currently about to enter the testing phase. That’s a very tight timetable, but SmartAdviser’s General Manager Nina Smith advised me in a call yesterday that Mitchell is committed to hitting the date.
The app, which is ‘enabled’ by SmartAdviser’s Capstone business rules engine, uses a proprietary approach to group procedure codes into a treatment group according to diagnosis, the idea being approval of a carpal tunnel release includes ‘approval’ of related services – facility charges, PT, anesthesia, etc. Mitchell expects the app to increase ‘throughput’ (bills not touched by a reviewer) by about 17%.
Competitor Medata implemented their solution about a year ago; according to Cy King, Medata’s CEO, the company rolled it out with a very large retail client who is quite pleased with the results. So far, client savings have increased from 5% – 7% depending on the month. Components of the solution are provided by Datacare through their Bill Zee product.
King reported that Medata is currently working on several additional implementations.
I’d note that it is entirely possible the other bill review vendors (CompIQ, Stratacare Coventry) offer similar UR-integration functionality, but at least as of last summer, no one was using them. If this is of interest, you can ask them at RIMS next week in Boston.
What does this mean for you?
Hopefully more efficiency and lower medical expense. Hopefully.
Apr
23
While this is a move in the right direction, the REAL missing link is between these system and the OUTCOMES of care. Quality care requires physician time, skill, and at times a bit of daring; none are encouraged by the present reimbursement and case management systems, despite the serious savings that are possible. Until your systems know which docs get good outcomes and which do not, case management and bill review often causes more problems than they solve.
Ironically, when we introduced PPOs to California work comp insurers in the mid-1980’s, every scheduled inpatient admission, and even unscheduled ones, had to be “reviewed”, whether before, during or after the discharge, for medical necessity or appropriateness. In the absence of such a determination, an insurer was not obligated to pay any inpatient hospital bill until the “certification” was performed. That was a contractual provision or agreement between the payer and the provider under the auspices of our PPO.
What occurred was the “linking” of the state authorized “certification” process with a negotiated reimbursement arrangement with participating facilities. It was all too obvious that payers had been paying for services that were not “certified” and this provision neutralized that omission. Of course, the PPO was the “enforcer” (by agreement), and unlike so many work comp PPOs today, our PPO was obligated to enforce this provision. I recall that this one feature of the overall arrangement “bedazzled” our insurer clients because that was a connection that bill review firms never made! By the way that was over 20 years ago!
Good points in this article.
most bill review companies do not understand how much additional savings can be acheived.
Actually it results in better quality care for our injured workers when it is done right.
We have the Bill ZEE program working at Safeway. results are amazing.
Faster return to work with a lower cost