Over the last two months, we’ve examined how organizational and technology structures can keep health plans from recognizing, understanding, and resolving their payment integrity challenges. This month, we want to spend a little time examining one thing that can be at the root cause of some of those challenges: eligibility.
Eligibility issues impact a multitude of payment integrity areas, including Coordination of Benefits and Medicare Secondary Payer validation, and, to a lesser extent, Workers’ Compensation, Other-Party Liability, and Subrogation. In fact, Discovery Health Partners’ research indicates that approximately 30% of payment integrity costs are driven by eligibility errors. In addition to the financial cost of payment integrity errors, eligibility issues can also have a direct effect on member satisfaction. Claims that are declined due to inaccurate or out-of-date eligibility data can lead to member abrasion and lost market share.
At their core, these issues all stem from the fact that health plans lack a single, definitive resource for making eligibility status determinations prior to paying a claim. This creates tremendous downstream issues as health plans make business decisions and pay claims based on flawed data.
The complex structure of health plans means that member eligibility is updated at multiple points in the claims payment process and is managed by multiple departments across the organization. As a result, it’s often inconsistent, outdated, or inaccurate, and leads to improper claims payments. Until plans are able to establish a single source of the truth for eligibility, these inaccuracies can cost plans millions of dollars. Let’s examine a few of these challenges more closely:
Multiple data sources
The sheer number of data sources feeding the master eligibility file has a significant impact on accuracy. Information comes from the members, providers, CMS, data-match vendors, and other data sources. These feeds are all subject to their own timelines, standards, and information challenges. In addition, these external feeds to eligibility status have a high rate of change, creating a complex hierarchy of overlapping status updates. Plans are challenged to manage these work processes and make a clear determination of primacy and eligibility that can support all of the transactions that rely on this data.
The eligibility challenge isn’t just technical, it is also frequently organizational. Eligibility is commonly managed by line of business, meaning that status updates made by one group are not necessarily shared across the organization. For example, changes in a member’s eligibility status might not be effectively communicated between the commercial and government lines of business as the member moves from commercial to Medicare Advantage coverage. With no clear owner of the member eligibility status, managing the data across departments adds an additional level of complexity.
In addition to being spread out across different departments, responsibility for managing eligibility status is shared by several administrative systems. Plans often make the mistake of addressing eligibility in a single point solution, rather than taking an enterprise view of member eligibility management. Claims and enrollment systems often fail to address eligibility on a consistent transactional basis, and frequently capture crucial updates in notes or text format. Eligibility data is rarely shared between systems, and because there is no single data master, the priority of status changes is unclear.
Looking to the future…
Health plans have the opportunity to dramatically improve their payment integrity performance and member retention by managing member eligibility as a business asset. The ideal solution will provide a complete and integrated picture of eligibility status across membership types and lines of business, while providing validated data for downstream applications. Doing so will require a shift in culture, as well as new technologies. Nonetheless, there are strategies that let you achieve progress in a staged progression, which we will explore in future posts. Managing eligibility data as a strategic asset is worth the effort, as it will result in millions of dollars in recoveries and cost avoidance.
For more information…
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