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Will HL7 Create Payer/Provider Symbiosis?

 |  By kminich-pourshadi@healthleadersmedia.com  
   December 13, 2010

The American Medical Association estimates that nearly $210 billion annually is spent to process healthcare claims. Moreover, approximately one in five medical claims are processed inaccurately, according to the AMA 2010 National Health Insurer Report Card. These processing errors cost an estimated $15.5 billion to the healthcare industry, and the report notes that if insurers could improve that number by just 1%, they would save nearly $777.6 million. 

The pressure for both payers and providers to operate more efficiently and cooperatively is becoming a necessity for all concerned—which is why many in healthcare are using their Six Sigma and Lean initiatives to make the interaction between payers and providers a collaborative effort to decrease claims adjudication woes. But there’s more afoot that will help morph this traditionally adversarial relationship.

Though Lean and Six Sigma initiatives offer a path providers can take to improve the claim adjudication process, the Health Insurance Portability and Accountability Act may open up another avenue. Tom Hughes, President and CEO of Georgia-based Medical Electronic Attachment, Inc., and a member of the attachment committee of HL7 which is part of the HIPPA regulation.

The HL7 standard encompasses a range of operational, training, policy and technical issues. eXtensible Markup Language (XML) syntax is the basis for the HL7 Clinical Document Architecture Standard, and the attachment itself is carried inside the binary data segment of the X12N 275, or the 275 standard. This syntax standard is specifically designed for and by the healthcare industry to facilitate patient data exchange between computer applications and systems.

The attachments would work as follows, Hughes says, the payer sends a 277 to request the 275 information (using the payer control number as the method to link these), and the provider then sends the 275 in the same envelope with the 837 (using the provider assigned). The attachment committee’s goal is to help the industry establish a common language among computer applications regardless of platform, architecture, or programming. The committee is further defining a standard that will make payers and providers capable of sending and receiving detailed claims or encounter information such as diagnoses, test results, observations, treatment modalities, and so forth, in a specific HL7 format.

Though it has been a long time in the coming, Hughes explains that portions of this standard are now completed and have been submitted to Health and Human Services for final approval. As of 2004 all payers are supposed to take claims electronically, the problem, however, is that the form in which documents are attached has been undefined and is causing miscommunication and claims processing delays.

Some payers have taken a proactive stance with electronic claims by creating provider networks. These networks are designed to give providers direct access to relevant information on the payer’s system, which enables both parties to share data electronically, perform claims transactions online, and provide centralized technical and billing support. By electronically streamlining the communication process between the payer and provider, these provider networks save time and administrative costs and they eliminate the need to process paper claims. Moreover, these systems allow for both payers and providers to use remote workers affording all involved with additional savings.

However, a uniform approach to how documentation is attached remains to be defined by HL7.
“Right now, there are solicited and unsolicited attachments, and only the payer decides if they will accept them. A payer would rather pay a claim instantly than send it back to ask for more information. Payers don’t want unnecessary attachments—you don’t want four million claims all with attachments,” he says.

While the HL7 standards await final approval, payers and providers must continue to look for ways to make their relationship generate more profit and less waste and strife—true symbiosis is the only way everyone will come out ahead.

Karen Minich-Pourshadi is a Senior Editor with HealthLeaders Media.
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