4 ways technology is shaping the future of COB

When we think of the future, we tend to think of things like space travel, the next presidential election, and what we’ll have for dinner later tonight. That’s all very interesting, but what about the future of…healthcare coordination of benefits? Okay, maybe it’s not as exciting as humans living on Mars or Oprah for president, but there are some interesting things happening in COB that are changing the way health plans approach this age-old process. Here are four ways technology is changing how we think about COB.

1. A data-driven approach

What do we mean by a data-driven approach? At the most basic, it means to use all relevant and available data sources to identify members with other insurance who could have recoverable claims. This isn’t necessarily futuristic. Don’t we all use multiple sources for this now – eligibility and claims files, MSP files, CAQH data, State Medicaid files, Section 111 reporting?

For the most part, yes. But HOW are we looking at this data? Is it a team of investigators pouring over Excel spreadsheets and printed files, trying to draw conclusions? Do they waste a lot of time investigating claims that aren’t recoverable? Are they calling members to get the information they need? Do they miss potential opportunities to recover claims?

It’s not just a matter of having the data. What matters as well is the speed with which we’re able to get that data. As an industry, when we think about the future of COB, we need to think about fast, automated data integration across multiple sources. In other words, bringing all that data together into a single database that can be queried to quickly and accurately identify claims that are likely to be another provider’s responsibility (see #2 below).

We need to think about refreshing this data faster so we have the latest information at our fingertips at all times so we can make decisions earlier in the process that would allow us to maximize our recoveries and up-front cost avoidance. And we need to think about emerging data sources that can help improve the accuracy of the member profile. For example, is there an opportunity to mine social data (e.g. Facebbook posts) to learn of qualifying life events?

If you really want to get into the weeds about data integration in the health insurance industry, check out this great blog post by data integration company Veristorm.

2. Analytic focus

Wikipedia defines analytics as the “discovery, interpretation, and communication of meaningful patterns in data.” From a COB perspective, we can apply analytics to the data we have to identify members with the highest probability of having other coverage.

Most in the industry are at least dipping their toes into the analytics pool. Much of it today is “rules-based” analytics. For example, we’ll create a simple business rule that says when a member turns 65, they should be on Medicare. This yields information that tells us to analyze whether those members are on Medicare.

Analytics is where things could get really interesting for COB and despite much hype, the industry is just getting started here. When we apply advanced analytic techniques like predictive analytics, we can quickly look at multiple factors (such as age, demographics, disease categories, and much more) to more closely pinpoint members that may require COB. Taking it a step further, machine learning technologies would automatically determine the most successful indicators (or combination of indicators) of other coverage and automatically update the analytic models to reflect that learning.

Even to me, this all sounds very complicated and daunting. Take it from my colleague Steve Forcash, Discovery’s analytics expert, who recently said, “For most organizations, leveraging analytics to drive improvements in payment integrity is more of an evolution than a revolution. I suggest starting small.” For example, start with your internal claims and eligibility data and see what you can glean from that. Find out what works and build on it from there. There are several benefits to advancing the use of analytics in healthcare COB, including:

  • Reducing the cost of COB (less manual effort, less time investigating false positives)
  • Reducing member abrasion (more accurate identification means less validation work)
  • Increasing cost avoidance (denying claims that are another plan’s responsibility)

3. Case management application

Full disclosure: this point is somewhat self-serving because Discovery has a proprietary case management application that we use to deliver COB solutions for our clients. But I feel so strongly that this current capability is also critical for the future of COB, that I couldn’t leave it out.

Though COB is a seasoned, well-oiled machine for most health plans, it does encompass many steps and individual processes. It also demands a “paper trail” to capture all the information that is discovered throughout those processes. A case management application is the perfect way to guide your team through your specific process, while capturing and sharing critical data along the way.

This single data repository should be used to drive all case-related activity so you have fast access to high-level and detailed case data. Our Discovery Case Manager allows you to see activity history, planned activity (case diary), and notes (about investigations, status, phone calls, etc.). You also can identify and manage rebill activity at the provider and claim level, and store and update employer and other insurance information and payer order.

Having all this detail in one place provides you with the digital paper trail that not only supports your recovery work, but that could also allow you to make future claims payment decisions more quickly and accurately. And this brings us to our final point below.

4. Reporting tools

As COB organizations become more sophisticated about their use of data and analytics, their reporting capabilities will improve. Dashboards and reports can be automatically created based on data in your case management tool and/or analytic tools to provide you with easy-to- see information about your membership, COB opportunities, and results.

Having access to more accurate data, the organization will be able to better identify members with potential other insurance, improve the accuracy of forecasting, and analyze trends. Reporting functionality through dashboards and/or standard reports is critical for understanding how well your COB process is functioning and to identify areas for improvement. Even with limited data and analytic capabilities, you can begin to experiment with reports. Important data to track for COB includes:

  • Case inventory
  • Case pending
  • Case status
  • Recoveries

The bottom line is that, wherever your COB program is in terms of technology maturity, there may be opportunities to step that up and boost the performance of your program even further. Most COB programs struggle with issues such as ongoing eligibility/member status errors, member and provider abrasion, and resource constraints. Technology-enabled COB can help address these and other challenges that may be standing in the way of your best year yet!

Learn about more COB trends in the infographic, Five trends in healthcare Coordination of Benefits.

Janetta Dean4 ways technology is shaping the future of COB
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Calculating cost avoidance: A closer look at one of 2017’s top payment integrity trends

This post is part of an ongoing series about trends happening within the payment integrity space for healthcare payers. This series features contributions from Discovery Health Partners payment integrity experts discussing these trends, why they’re happening, and how they affect health plans. To learn more about all of the top trends, download our 2017 Payment Integrity Trends whitepaper.

Making the business case for prepayment cost avoidance

As health plans more aggressively adopt cost avoidance as a payment integrity tactic, many struggle with the business justification. There simply is no industry-standard method of quantifying cost avoidance.

With pay-and-chase models of recovery, it’s usually pretty simple – you calculate the recovery and if you’re using a vendor, you subtract a percentage contingency fee. It works nicely in a spreadsheet formula and the extra cash looks great in your P&L. But if you’re avoiding—not recovering—dollars, how do you measure the return on investment? How do you calculate the costs avoided?

Health plans have been left to their own devices to determine the right method to quantify the business case for cost avoidance. And to compound this issue, the method of measuring cost avoidance and the business case isn’t consistent across all types of payment integrity. The calculation and return on investment will differ depending on whether you’re looking at coordination of benefits, subrogation, claims analytics, etc. Based on my experience, even among the largest health plans, there is incredible diversity of opinion on how to measure and value prepay. Read on to learn about some examples that I’ve come across.

Claims cost multiplied by estimated months of savings

This large commercial plan with over 40 million members uses average claim cost per member to calculate potential savings from cost avoidance. The plan first identified “leads,” or members suspected of having other coverage, and sent them to Discovery Health Partners to verify other coverage.

Of those leads, 10% have been confirmed to have other primary coverage. The plan estimates that it would have paid claims for those members for 6 months before catching the error. By multiplying the 6 months times a monthly claims cost per member, the plan figures it avoids more than $7 million in erroneous payments.

This method provides a general sense of the value of cost avoidance, which allows this plan to justify the cost of using a vendor as a partner for some of its prospective COB processes. Not all buy into this method, though. Some might argue that not all members would incur the average claim cost in all 6 months, and some of the costs, had they been paid up front, likely would have been recovered on the back end. This method doesn’t account for that.

On the other hand, it accounts for neither the administrative cost avoided by not having to recover on the back end nor the fact that a percentage of recovery efforts are unsuccessful. In the end, this plan felt that these balance each other out and the methodology works for now.

In another example for COB cost avoidance, one of our clients uses the average cost of claims for each member over the previous 12 months and applies that value over the next 12 months.

Costs to consider when calculating ROI on cost avoidance

Once you have identified a method of calculating the value of cost avoidance, you need to understand the costs that are involved in developing cost avoidance capabilities.

  • Vendor fees. How vendors make revenue will depend on the method the health plan uses to calculate cost avoidance. Options could include contingency, transactional (per validation), monthly, and fixed fees.
  • Resources. Subject matter expertise and operational expertise will help ensure you avoid the right costs at the right time with minimal member and provider abrasion.
  • Technology. Software and other programs allow you to integrate the data from correct sources into your systems so you can make timely pre-payment decisions. This could include applications to manage the workstream.

The move to prepay cost avoidance requires a set of skills that health plans need to develop or acquire in order to be successful. These should be considered when calculating the cost. See our infographic for a list of these capabilities.

 

 

 

 

 

 

 

 

Discovery Health PartnersCalculating cost avoidance: A closer look at one of 2017’s top payment integrity trends
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Prepayment cost avoidance: A closer look at one of 2017’s top payment integrity trends

 

This post is part of an ongoing series about trends happening within the payment integrity space for healthcare payers. This series features contributions from Discovery Health Partners payment integrity experts discussing these trends, why they’re happening, and how they affect health plans. To learn more about all of the top trends, download our 2017 Payment Integrity Trends whitepaper.

Health plans see value in prepayment cost avoidance

Health plans are making a concerted effort to focus more of their payment integrity resources on avoiding inaccurate claims payments up front, rather than recovering erroneous payments on the back end. There is general agreement that this creates more value for a plan. When done successfully, prepayment cost avoidance allows the plan to avoid 100% of the claim cost (vs. the portion they can recover) and it reduces downstream administrative costs associated with recovery. I think we all can agree that having to work a claim multiple times is obviously more expensive than having to work it once.

In addition to financial benefits, prepayment cost avoidance can help health plans positively affect relationships with providers by reducing the burden on them to rework claims that are the responsibility of another payer. I recently saw a statistic that said providers incur an additional 20% – 30% of the cost of any claim they have to rework. Your providers would welcome a reduction in that cost.

Meanwhile, a focus on cost avoidance makes your members more accountable for ensuring that correct eligibility information is on file. Particularly in an area like coordination of benefits, members should feel more compelled to be proactive about providing the health plan with accurate, current information so their claims will be paid promptly without fuss.

Why the cost avoidance shift is happening now

In my experience, this is probably the biggest trend in the industry today. Why? Because of the vendor fees and administrative costs associated with recovering a claim that was paid incorrectly. At a time when health plans are very focused on reducing administrative costs and managing shrinking margins, executives are paying attention to every source of leakage.

While prepayment cost avoidance is not a new concept by any means, it requires a level of maturity within a health plan’s payment integrity operations that some plans are just now reaching. For one thing, more mature health plans typically have stronger data integration and analytics capabilities that allow them to look across multiple sources of information to make more accurate payment decisions quickly.

At the same time, their experience with postpayment recovery operations has given them some data to build a business case for the shift to cost avoidance. In my opinion, the largest barrier to cost avoidance until now has been the inability to justify the effort—cost, resources, technology, and vendors—in terms of a business case. There is no standard ROI or business model to work with, and every plan I’ve talked to uses a different approach. The fact is that health plans need to spend money to create a prepay cost avoidance capability and that means making sure the right people in the organization understand the value and business case for it.

For more information, see our infographic about capabilities required for successful prepay cost avoidance.

Coexistence with postpayment recovery

While prepay cost avoidance should be part of a plan’s payment integrity strategy, postpayment recovery must remain part of that strategy as well. The ability to make a prepayment decision can be hindered by the availability of information and the dynamic nature of eligibility and primacy information. Information often isn’t available fast enough to decide if a claim should be held or pended, so prompt-pay rules dictate that the plan must pay.

Meanwhile, member eligibility status and primacy are moving targets and constantly change, so payments are based on outdated information. For some payment integrity functions, like subrogation, costs can be avoided only on part of the whole recovery. In that case, only the first-party liability costs can be avoided, while third-party liability costs have to be paid.

Finding the right balance for your plan

In our view at Discovery, prepay cost avoidance and postpay recovery have to coexist as an integrated solution so you can follow the transaction through the whole lifecycle. The goal should be to find the right balance for your organization.

As health plans consider the proper balance of prepayment cost avoidance and postpayment recovery across their payment integrity programs, it’s important to remember that this is largely a cultural decision. A plan has to be ready to adopt prepay solutions, and a lot goes into that decision—including regulatory issues, technology capabilities, data availability, subject matter expertise, and the business case.

 

 

Discovery Health PartnersPrepayment cost avoidance: A closer look at one of 2017’s top payment integrity trends
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Discovery Health Partners wins new healthcare customers

Intelligent Cost Containment Software Delivers Transparency, Control and Savings 

ITASCA, IL (September 19, 2013) – Discovery Health Partners  today announced that it has added new healthcare organizations to its client roster and expanded current customer portfolios, demonstrating demand for effective analytics-driven payment integrity solutions that reduce and contain healthcare spend.

Since January, Discovery Health Partners has won multiple new healthcare clients seeking proven solutions for healthcare subrogation, COB recovery and eligibility services.  They include Paramount Health Care, a large southern integrated health care services system, a leading mid-Atlantic health plan, and a leading western health plan.

Additionally, current client Lovelace Health Plan expanded its partnership with Discovery Health Partners with a Cost Containment Blueprint consulting engagement, which identified new opportunities for cost savings and revenue generation.  Fallon Community Health Plan, another client, extended its relationship with Discovery Health Partners to include Medicare Secondary Payer (MSP) Validation and Premium Restoration in addition to existing services provided for subrogation and COB.

“Discovery Health Partners has been a true partner in every sense for our recovery and cost avoidance programs,” said Karen Eskridge, Chief Operations Officer, Lovelace Health Plan.  “Their team has helped us to reduce erroneous claims payments and improve reporting; working together, we’ve also broken down obstacles and identified new savings opportunities we hadn’t seen before.”

Discovery Health Partners recently published the following client successes:

  • Within the first year, a mid-sized health plan with more than 230,000 members (including 30,000+ Medicare Advantage members) realized nearly $3.5 million in subrogation and COB recoveries.  By adding MSP Validation and Premium Restoration, the health plan recovered an additional $7.4 million dollars in six months. The health plan’s total two-year forecast for these services is nearly $15 million.
  • A community health plan with more than 200,000 members (including 30,000+ Medicare Advantage members) realized incremental savings of more than $2 million with Discovery Health Partners’ subrogation and COB services in seven months. The health plan expects to recover an additional $2.4 million in subrogation claims over the next six to 12 months. MSP Validation and Premium Restoration Services are expected to recover an additional $8.4 million in 2013.
  • Seeking greater transparency and the ability to respond faster to employer group reporting requests, another health plan adopted Discovery Health Partners’ cloud-based subscription software for on-demand analytics and case management tools. As a result, the health plan decreased their resources, support needs, and capital expenditures.

“Our flexible offerings, client advocacy, and leading-edge tools are highly valuable to our clients’ cost management programs,” said Paul Vosters, President and Chief Operating Officer, Discovery Health Partners. “We help clients look holistically at their cost containment efforts, and we will customize a plan and approach to meet their unique requirements. We quantify the results to show the difference we make.”

 

 

 

 

 

 

 

 

 

 

 

 

Discovery Health PartnersDiscovery Health Partners wins new healthcare customers
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Discovery Health Partners enhances its Coordination of Benefits solution

ROLLING MEADOWS, IL (June 27, 2012) – Discovery Health Partners, a provider of intelligent, cloud-based healthcare cost containment solutions, today announced that it has integrated Medicare Secondary Payer Validation and Medicaid State File Validation to its core Supplemental COB services – further enabling health plans to save in paid claims, avoid unnecessary cost, and improve the integrity of their eligibility files.

Medicare Secondary Payer (MSP) Validation examines open MSP records for Medicare Advantage organizations to ensure that premium revenue generation opportunities are maximized. Medicaid State Eligibility File Validation confirms the validity of other coverage information collected by the state through its mandatory reporting. Now Discovery Health Partners’ Supplemental COB services utilize all relevant information—eligibility, claims, MSP, Medicaid State Eligibility Files, Query Only (HEW) Input files, and annual COB surveys – to enhance data mining and speed the process of identification, proper coordination, recovery, and eligibility system updates.

“As costs for employee medical insurance continue to grow, more health plans are adding supplemental COB services to their cost containment strategies,” said Paul Vosters, President of Discovery Health Partners. “Up to 10% of claims have coordination potential. We have a rich history as data experts and management consultants to augment internal COB programs.”

Section 111 reporting requirements have escalated the number of open MSP occurrences for Medicare Advantage organizations. This drives an increased number of premium adjustments – many of them invalid – that negatively impact a health plan’s revenue stream. Additionally, the information Medicaid MCOs receive from the state often contains outdated and inaccurate information; it is challenging to load such data into eligibility systems without overriding recent updates with erroneous information. Medicaid State Eligibility File Validation updates eligibility files with accurate coverage information, and ensures that claims are paid timely and accurately and overpaid claims are quickly identified and recovered.

Three software-as-a-service (SaaS) applications support Discovery Health Partners’ Intelligent COB solution: Discovery Identification℠ uses sophisticated data mining to accurately identify opportunities to coordinate benefits and generate cases for investigation. Discovery Case Manager℠ manages the COB process by housing all data and activities associated with each inventoried case. Discovery Dashboard℠ provides interactive analytical features for complete transparency and customized trend and case reporting.

“Staying on top of complex COB rules is our specialty. By utilizing our expertise in COB, we free up a health plan’s resources to focus on quick and accurate claims payment,” said Laura Cohen, Director of Client Advocacy and Coordination of Benefits Operations. “Our COB solutions blend technology, process improvement and workflow automation so all health plan member populations — Commercial, Medicare, and Medicaid – will no longer lose claims payment revenue due to poor data.”

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Discovery Health PartnersDiscovery Health Partners enhances its Coordination of Benefits solution
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Laura Cohen joins Discovery Health Partners

ROLLING MEADOWS, IL (March 12, 2012) – Discovery Health Partners, a provider of cloud-based healthcare cost containment solutions, announced the addition of its newest executive management team member, Laura Cohen.  As Director, Client Advocacy and Coordination of Benefits (COB), Ms. Cohen serves as an ambassador for client engagements and manages new client onboarding and customer relations, including retention, growth, satisfaction, reporting, and business development.  Dually, Ms. Cohen oversees operations and product development for Discovery Health Partner’s COB offering.

“Laura’s extensive experience directly aligns with our priorities, which are to continue serving our growing roster of customers with excellence; further build and differentiate our COB solution; and expand the business,” said Paul Vosters, President and Chief Operating Officer of Discovery Health Partners. “Laura’s customer focus, industry knowledge, and financial savvy are a tremendous asset.”

Ms. Cohen brings a 20-year track record in health insurance customer service, business development, financial operations and administration, and profit-building. Prior to joining Discovery Health Partners, Ms. Cohen was Vice President of Operations at ACS Recovery Services, a Xerox Company. In this role, Ms. Cohen had complete responsibility for all claim overpayment identification and recovery services for large healthcare payers. Her achievements were numerable, including significant revenue and profit growth, division performance optimization, increased staff productivity. In 2009, Ms. Cohen was named Line of Business Innovator of the Year. She also earned the designation of Lean Six Sigma Champion.

Previously Ms. Cohen served in the capacity of Line of Business Controller at ACS, where she was responsible for transitioning all Primax Recoveries financial reporting, cash management, human resources, payroll and benefit functions to ACS after acquisition, and handling ongoing reporting to ACS corporate thereafter. Previous to the ACS acquisition, Ms. Cohen was Chief Financial Officer/Controller for Primax. Earlier in her career, Ms. Cohen worked at BABCO Investments as Controller/Consultant and at Advanced System Applications in various financial and accounting roles.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Discovery Health PartnersLaura Cohen joins Discovery Health Partners
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Healthcare claim recoveries jump with Discovery Health Partners

ROLLING MEADOWS, IL (July 13, 2011) – Discovery Health Partners, a provider of cloud-based healthcare cost containment solutions, today announced that it has successfully improved claims recoveries for all customers who have implemented its Intelligent Full Service Subrogation and Overpayment solutions – even driving a recovery increase of 40%  for one customer.

Since its 2008 founding, Discovery Health Partners has broken new ground within healthcare cost containment by launching the industry’s first purely cloud-based platform that offers Subrogation, Dependent Eligibility Verification, Coordination of Benefits and Information Analytics solutions in a fully outsourced model or via SaaS (pay-as-you-go) for in-house management – or in any combination in between.

“Traditional recovery and overpayment methods are antiquated, slow, complex and opaque. Analytics and cloud computing are driving a major wave of change in healthcare cost containment, and we’re at the forefront of it,” said Paul Vosters, President and COO of Discovery Health Partners. “Greater visibility and transparency enable organizations to monitor, control and improve their programs and those of their vendors. This insight is essential for better recoveries and operational savings.”

Discovery Health Partners’ customers include national and regional health insurers, healthcare providers, and self-funded organizations such as Humana, Lovelace Health Plan, Meritor, The Mentor Network and Rush System for Health, among others.

The intelligent platform enables customers to monitor their recovery operations more closely, manage other vendors on a single platform, and even compare their recovery operations to others through industry benchmarking. Three proprietary applications – Discovery Identification℠, Discovery Case Manager℠ and Discovery Dashboard℠ — identify cases for investigation; provide start-to-finish case management tools; and offer interactive analytics for visibility into current cases, real-time and historical views, and a range of customizable reports.

Rapid scalability is an additional benefit of Discovery Health Partners’ cloud platform. Within three weeks, Discovery Health Partners successfully began processing claims for a major national health plan with five million lives. The platform also supports massive data growth as Discovery Health Partners approaches petabyte-level claims analysis.

“We’ve raised the bar for methods in healthcare and benefits cost containment,” said Vosters. “Savvy organizations today expect higher standards for transparency, advanced analytics and reporting, and flexible delivery in healthcare recovery.”

 

 

 

 

 

 

 

 

 

 

 

 

 

Discovery Health PartnersHealthcare claim recoveries jump with Discovery Health Partners
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