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Bad Debt? Blame a Low-Tech Payment System

Karen Minich-Pourshadi, for HealthLeaders Media, November 7, 2011

"We knew verifying eligibility on the front end was extremely important, but the reality is we have very busy secretaries trying to capture this information and very little time to do it," says Michael Gonzales, billing and operations manager for Radiological Associates of Sacramento Medical Group. For this group practice, with 23 locations and 2,000 patient visits per day, the manual process was a challenge.

"Asking the secretaries to search each insurance company website or make a phone call to the insurance company [to verify eligibility] while checking in patients and taking them to the exam rooms was a lot. So quite often the patient's information didn't get verified until it got to the back end, and that would cause delays or denials in payments," he explains.
 
Gonzalez estimates that 4.3% of the group's monthly payments were lost to incorrect eligibility information. The group added a real-time eligibility software program and within three months reduced eligibility-related claims errors by 56%. (Note that these programs don't eliminate the need for staff to compare a driver's license against the insurance ID card to prevent insurance fraud.)

Upgrading the eligibility verification process is just one area to look at in your payment process. Financial leaders should also examine how they are paid. Just 10% of payments to health providers are made electronically, according to the National Process Report on Healthcare Efficiency. If all healthcare providers and payers processed claims electronically and took payments via electronic funds transfer or e-checks (provided by ACH Direct), healthcare as a whole could save $11 billion, according to the report.

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