Healthcare payment processing haschanged significantly this decade as thecomplexity of processing payments hasgrown. At the same time, the technology forautomating that process has evolved, withsolutions available not only from certainspecialty software vendors, but also from asurprising source: the banking industry.
Full payment processing automation isfundamentally about getting a practice’smoney in the bank as quickly as possible.Therefore, it makes great sense to use abank.
A LOOK BACK Looking back just a few years, theprogress made in automating paymentsprocessing is easy to see. Even with therelease of the ANSI 835 format in 1991, asrecently as five years ago the vast majorityof payments and EOBs were still on paper.This meant the cash flow for most providersin 2004 was still very paper–bound.
Some banks evolved their lockboxofferings to scan and index clientdocuments, a major step forwardin streamlining the back office. Thevalue proposition of turning paperinto a searchable, electronic formatwas compelling: save time and makemore money. Time savings came fromproductivity gains and the profit boostcame from gaining faster access to cash.However, while scanning paper and storingit online was a step forward, most of thesesolutions did not provide integrationwith Practice Management Systems. Theback office staff still had to post paymentsmanually.
THE NEXT STEP Even with this electronic processingof payments and EOBs, providers todaystill receive a mix of paper and electronicpayments and documents. This means thatmost practices don’t yet realize the promiseof automatic posting. Practice ManagementSystems that accept 835s can provide thebenefits associated with automatic posting.However, paper EOBs keep providersfrom reaching auto–posting nirvana.Furthermore, reconciling payments toEOBs remains complex due to the multipleformats in which they are received.Help for providers exists in the form ofcurrent generation healthcare paymentprocessing solutions that far exceed theirdigital lockbox predecessors in terms ofcapabilities.
WHAT TO EXPECT New solutions for automating healthcarepayment processing promise to helpproviders achieve the highest rate of autopostingpossible while providing othervaluable benefits. These solutions aggregateall payments and EOBs regardless of theformat in which they are received. Thereconciliation process becomes automated.Secondary billing, denied claims andunderpayments are likewise detectedautomatically and presented to the providerfor action. Most importantly, a singleelectronic file is output that feeds PracticeManagement Systems to facilitate autoposting.
It is appropriate to set an expectationabout these solutions. Achieving a 100percent auto–posting rate is not alwaysobtainable, but a premier solution can offerrates as high as 95 percent. Furthermore,the degree of integration difficulty varieswith every Practice Management System.
HIDDEN BENEFITS Eliminating manual posting is amajor benefit to today’s revenue cyclemanagement solutions, but it is easy tooverlook other major benefits. Imaginesearching all of your payment information,regardless of whether it came on paperor electronically. That capability is now areality. Access to data is greatly simplifiedbecause all payment data is aggregated intoone electronic repository, making on–the–flyresearch easier and less time–consuming.
Other benefits exist as well. Physicaldocument handling is eliminated, so timeis not wasted on filing. The exceptionshandling process is expedited. Theseindividual productivity benefits combinedform one large, compelling benefit: areallocation of staff away from documenthandling tasks to full payment recovery.
THE RETURN The return on investment (ROI) inhealthcare payment automation is alsocompelling. An accurate ROI estimateis developed by looking at the candidatetasks for automation, then applying someassumptions which the following exampleillustrates:
Using these productivity assumptions,the 25 hours spent daily on these four tasksis reduced to 6.2 hours, for a savings of 18.8hours. Multiply the hours saved by yourhourly average staff salary with benefits.For the sake of this example, assume aloaded salary figure of $20 per hour. Thevalue of productivity in this examplebecomes $376 per day or close to $7,800each month. This estimate does not includethe additional benefit of freeing staff time topursue full payment recovery.
SUMMARYK SNB offers the SNB DirectRemit MDhealthcare payment management solutionto help providers save time and moneyon a whole new level. Various industryestimates in recent years reveal that asmuch as 30 percent of every healthcaredollar goes to defray paperwork andadministrative costs. SNB DirectRemit MDwill drive this figure lower, to the benefit ofpayers, providers, billers and patients alike.For more information or to schedule ademonstration, please visit: www.banksnb.com/directremitmd.
