A changing environment drives the reevaluation of current COB practices
Healthcare coordination of benefits (COB) has been a relatively unchanged process in health plans for many years, but advances in data management, analytics, cloud-based software, and digital communications are causing some interesting trends to take shape in the COB world. These technologies, which have transformed many industries, are making their way into payment integrity processes, where health plan executives are working to address the challenges that cause inaccurate claims payments and to improve the processes that are used to identify, avoid, and recover those payments.
Inaccurate member eligibility and primacy data is often at the heart of payment issues. In fact, with multiple people and processes responsible for updating member status, it’s no wonder we don’t see more payment problems than we do. Too often, member eligibility and primacy are updated based on the narrow lens of a single person or process at a single point in time. Trying to avoid or recover claims based on this data often puts members and providers in the middle, causing abrasion and dissatisfaction. And as we know all too well, member abrasion can directly impact a health plan’s bottom line with members opting for different plans and affecting Star Ratings for Medicare Advantage plans.
As cost continues to be a core issue for health plans, it’s time to look at better ways of controlling costs, correcting payment errors, and protecting premium revenue while shielding members and providers from the fallout. Five key trends – or potential trends – are recurring topics of discussion, research, and tests among health plans and their vendors. We recently discussed these trends in a webinar that you can watch on demand, “Coordination of benefits: how the latest trends are impacting your plan.” The trends discussed include:
- Momentum away from pay and pursue: As payers mature in their overall payment integrity technologies and best practices, they are working to shift more of their COB efforts to avoiding inaccurate claim payments vs. recovering them on the back end. Pre-pay cost avoidance can yield a 40% increase over recovery, so the business case speaks for itself. However, this more proactive approach requires more sophistication in areas of data integration and analytics to quickly and accurately identify claims that are not the plan’s responsibility.
- Emergence of “matching” services: There seems to be a push among large health plans to require vendors and other health plans to leverage data matching vendors for eligibility validation. We find that this data is most useful for identifying “leads,” or potential cases of other insurance that can be further investigated. Plans can then focus their COB resources more intelligently for a better return on their efforts.
- Attempts at using analytics: Our industry has a growing appetite to incorporate analytics into COB processes to identify members with the highest probability of other coverage. Increasing the use of analytics throughout payment integrity generates many potential benefits, including reduced cost of COB and reduced member abrasion. While many health plans are making small steps in this area, there is still a long way to go. Rules-based analytics can tell us, for example, that a member who is 65 should be on Medicare and we should investigate whether that is the case. But beyond that, predictive analytics and machine learning technologies can help us look at multiple factors (age, demographics, and disease categories) to more closely pinpoint members that may require COB.
- Balancing COB efforts with risk of member and provider abrasion: Health plans are demonstrating increased frustration with traditional methods of member and provider outreach, which can result in abrasion. As a result, plans and their vendors are looking at new ways to get the information they need while communicating with constituencies on their terms. This may include using a combination of traditional communication channels as well a member and provider portals, mobility, and automation (such as using 270/271 transactions) to exchange information in more productive, cost-effective ways.
- The need for data integration is outpacing the industry’s ability to provide it: The trend here is simply that the industry is not evolving fast enough to meet the data needs of all parties involved. Bringing together data from a variety of sources, including claims, social media, Section 111, CMS, states, providers, and much more, is necessary to support areas of eligibility, analytics, and pre-pay cost avoidance. But as an industry, we are still largely unable to sustain the high volumes of data, integrate it properly, ensure its accuracy, and access it fast enough to inform payment decisions.
To learn more about these trends and some ideas for moving forward, listen to our on-demand webinar. You can access the webinar from our web site.