Taking Action to Reduce Improper Payments
By Monique Pierce, Solutions Product Development at SCIO Health Analytics
Healthcare Payers are under more pressure than ever before. Industry studies have estimated that payers could be losing in excess of $100B annually, due to fraud, waste and abuse and billing and payment errors. Recent changes in the market place have further complicated an already complicated system emphasizing the need for improved payment integrity efforts.
Through analytics, we have learned that payers have a higher risk of improper payments if their organizations have:
- A lack of configurable and easy to apply payment policy/editors
- Diverse lines of business, products, and plans across multiple markets
- Complex/customized benefits and or provider contracts
- Limited pre-payment review with a reliance on back end recovery processes
- An older claim payment systems with costly system enhancement limitations
- Limited use of specialized payment integrity vendors
The billion dollar question remains: “How do we take action to reduce improper payments in an organization and/or corporation?”
Health payers can better control costs and reduce overall payment discrepancies with the help of programs that both apply AND integrate learnings from advanced analytics across the organization. To maximize payment integrity effectiveness, programs must apply a “Full-Cycle” approach, which includes Prevention, Avoidance and Recovery.
Traditionally, post-pay audit and recovery played the key role in helping health plans control medical cost. Today, technology innovation has enabled powerful analytics giving payers the ability to prevent or avoid these errors reducing administrative and medical costs.
An effective strategy for preventing improper payments involves deploying technical infrastructure designed to prevent improper reimbursements. With the help of technical tools, including data-driven decision making, real time detection, data matching and predictive analytics, a thorough understanding of data provides insights as to which disbursements are indicative of improper payments. The best and most desirable programs are the ones that analyze and assess existing systems, policies and contracts and recommends areas where changes will prevent payment errors.
In addition, payers have the ability to strategically and purposely stop suspicious claims in the adjudication flow, allowing pre-pay review to avoid billing and adjudication errors, even potential fraud.