The Strategic Approach to Claims Cost Containment

The Strategic Approach to Claims Cost Containment

Competing with other health plan functions for technology priority can lead to missed audit claims cost savings potential. An integrated payment integrity strategy breaks down these internal silos.

With so many moving – and vital – parts within a payer organization, how can we ensure we don’t overlook claims cost containment opportunities? In theory, key departments such as Claim Operations, Provider Audit, SIU and Payment Integrity integrate harmoniously. They have the same goal, after all. Pay claims right the first time. In reality, the division of tasks – and budgets – across multiple payment integrity departments swiftly leads to inefficiency, often in the form of data silos.

These internal silos pose significant challenges to your goals, including accelerating payment integrity results. “Experts believe that healthcare organizations will need to invest in the appropriate tools and infrastructure to effectively manage data,” according to Stanford Medicine’s inaugural Health Trends Report. In an industry that faces ever-changing compliance, regulatory, and technological mandates, warehousing data into inaccessible silos can be crippling.

3 Questions to Diagnose Claims Cost Containment Silos

When considering how to improve returns on claim spend beyond the industry average, health plans often think in terms of their external competitors. Namely, how to access or develop more advanced analytics to root out wasteful spending. Complex concepts offer distinct value, no question. But, if your organization operates with internal technology disparities that perpetuate data silos, meeting increased claims cost savings goals will prove difficult. In fact, this inefficiency and lack of alignment puts 3-7% of paid claims dollars at risk each year.

To root out these fundamental issues that hold you back from real progress on payment integrity, we recommend you ask three questions.

1. Do you have areas of payment integrity responsibility with conflicting goals?

Payment accuracy is multifunctional — from fraud and abuse detection to auditing and quality monitoring. The challenge is that each function’s approach to payment integrity can vary widely. They are incentivized differently. And some areas – data mining and COB, for instance – may even compete against each other.

The success or failure of these programs can impact claims cost savings in different ways. But managing these important functions piecemeal isn’t just inefficient. It’s counterproductive to your potential. The ability to quickly and accurately identify billing errors pre- and post-pay – across all claim types and scenarios – depends on payment integrity working in concert.

An effective payment integrity program should incorporate everything from advanced technology to hands-on clinical, fraud and claims experts. Shared goals allow health plans to make the most of limited resources.

2. Does each function have a separate budget for technology development?

Some organizations centralize every technology purchase under IT’s purview. But budgets are often allocated by functional area. Sometimes those functions responsible for compliance take priority. A health plan simply can’t ignore FWA, COB or policy adherence requirements after all. In other organizations, the departments that best show high returns take precedence.

It makes sense for health plans to focus limited resources on core strengths. But, if you want to progress on payment integrity results, look for areas making do with spreadsheets, outdated databases, shared analytics experts, or a few contingency-based services vendors. These under-resourced functions may struggle with administrative complexity that hampers their expertise.

But with equal access to advanced technology and data insights, they could contribute significant value. Including taking on cost-effective internalization strategies around audits – data mining, DRG review, itemized bill reviews and more.

3. Do you have systems that don’t talk to each other?

With these misaligned functions dedicated to various areas of payment integrity, disconnected technology systems naturally arise. A suboptimal mix of cloud-based, on-premise and manual systems breeds disparity. Inefficiency also plagues these teams in the form of repetitive and redundant tasks.

Without even access to data, each function may create similar analytics for the same KPIs. Some may miss out on opportunities surfaced by real-time data. Those without access to automation and A.I. capabilities will find themselves behind on productivity and advanced skills development.

These disconnects have consequences. In a study of organizations’ IT systems strategies, those who had adopted key technologies and scaled those across functions achieved significant value. Those that didn’t had 15% in foregone annual revenue as of 2018. And the projected gap gets worse. “If they don’t change, they could miss out on as much as 46% of their annual revenue by 2023.”

Resolving Inefficiencies Created by Internal Silos

Once you have identified potential silos in your claims cost containment process, it pays to fix them now rather than later. We know minimizing revenue leakage is imperative – and complex – for our industry. It’s difficult to resolve workflow inefficiencies and ascertain the relative success of our efforts if we cannot bridge the gap between various payment integrity functions.

Every department involved in payment accuracy should have the ability to utilize a stream of aggregated data – data distilled from silos. We have seen health plans structurally integrate these departments to achieve alignment. But even then, technology does a lot of the heavy lifting. A single, integrative platform can resolve these inefficiencies more swiftly while conferring additional advantages.

A single platform approach to payment integrity

Ideally, organizations will navigate to a platform that streamlines both internal and third-party data into a single information portal. Obtaining visibility into overall claims cost containment creates significant advantages for payers. The increased transparency between departments provides strategic insights that allow for:

  • Implementing a more robust payment integrity program
  • Determining what to insource vs. what to outsource
  • Increasing recoveries by at least 5% year-over-year
  • Tracking and accounting for all payment integrity inventory
  • Tracking payment integrity projects from ideation through to project completion
  • Creating little to no provider abrasion
Technology ecosystems as a competitive advantage

The benefits also go beyond the obvious upsides of being able to more confidently manage overpayment prevention and recovery efforts. With good data practices and a technology platform in place, a variety of analytics use cases that drive business value for you and your stakeholders can emerge. It also allows you to deploy advanced, best-in-breed tools like robotic process automation and applications of A.I.

This digital-first approach can cement your competitive advantage. According to McKinsey research, these technology ecosystems often display a “winner-takes-all" dynamic. But this ability to convene a digital health ecosystem isn’t limited to technology giants or national payers.

Pareo Helps Realize ROI on Claims Cost Containment Goals

As an integrated platform for all of your payment integrity efforts, Pareo has a proven track record of helping payers achieve their claims cost avoidance and recovery goals.

Consider how increasing access to technology and data visibility transformed the operations at one of our clients. This Medicaid MCO with 2+ million members wanted to move more claims recovery work internal and use vendors for more strategic opportunities.

They started by implementing Pareo Supplier Optimization to gain insights into vendor performance. They quickly added Pareo Audit and Pareo Clinical to support the build-out of their recoveries unit and internalize key analytics. As a result they:

  • Grew vendor footprint 5x
  • Increased recoveries 2.5x within a single year
  • Grew internal recoveries by 50%

Altogether, their return on investment has exceeded 10x, far surpassing their initial targets. Before Pareo, they lacked an internal payment integrity structure and struggled with under-resourced functions. But they understood their ability to scale was key to achieving a competitive advantage. Pareo met them where they were and enabled them to drive a sophisticated technology ecosystem strategy.

Learn how Pareo can enable strategic moves in cost containment

Pareo Audit is a powerhouse solution for health plans that are looking to launch strategic initiatives around cost containment. Learn more about the benefits that Pareo Audit can bring to your health plan's technology stack by accessing our brochure below.

How to Evaluate Payment Integrity Solutions: The Ultimate Guide for Health Plans

How to Evaluate Payment Integrity Solutions: The Ultimate Guide for Health Plans

Payment integrity solutions vendors make many claims. Here are the top 14 areas of evaluation to ensure a perfect fit for your health plan.

Virtually every health plan is looking to address shrinking margins by moving their medical savings from a typical 1-2% today to something above 5% over the next few years. At the same time, the amount of healthcare data is only expanding, making that goal more difficult to address with current solutions. Are you prepared to thrive in this increasingly complex environment? You may find it’s time to evaluate payment integrity vendors and solutions.

Most of the health plans and payers we talk with are in one of two camps: a few self-developed solutions for claims audit and recovery, or scores of piecemeal applications used by the assorted departments dedicated to different areas of cost containment.

No matter your current approach, health plans have an increasing number of advanced technology choices in front of them, all promising “the answer.” New solutions emerge every day to address your interoperability, data and analytics challenges. As your options expand, so do your chances of finding the right fit for your organization – or the wrong one.

What’s at stake? Your rate of recovery.

Choosing the right payment integrity solution for your health plan holds arguably the greatest potential impact on your bottom line. When ClarisHealth conducted a survey examining payment integrity returns on claim spend at the leading national and regional health plans, we discovered a key difference. Those payers who had a scalable technology solution in place more than tripled their rate of recovery. Those that depended on outdated applications that require a great deal of manual intervention just couldn’t compete.

As your health plan looks to evaluate payment integrity solutions emerging on the market, three questions will guide you in your search:

  • What are the most important elements of functionality to consider to address your needs – now and into the future?
  • Is the goal a single, integrative platform to replace manual and piecemeal tools, or an assortment of upgraded solutions?
  • How do the different options – payment integrity platforms, self-developed technology, claims editors, fraud tools, third-party services providers – stack up against each other?

In this guide, we will examine the most important areas of consideration to offer a comprehensive payment integrity checklist for your health plan’s needs.

Functionality is the Top Consideration

When you start to evaluate payment integrity options (and consequently, the tech companies and services providers that develop these solutions), functionality should be the top consideration. Nested under functionality are several areas of evaluation that make up a powerful payment integrity checklist:

1. Supplier Optimization

Services vendors are a big part of most cost containment strategies. So, the ideal payment integrity solution should optimize the value you receive from third-party suppliers. Look for functions like overlap control, contract management and performance reporting all integrated through a single platform. Onboarding a new payment integrity supplier should also be quick and easy. With this functionality in place, you should expect to realize, on average, a 30% increase in supplier efficiency.

2. Audit Workflow and Analytics

If you want to internalize more payment accuracy efforts, you should prioritize functionality that assists in maximizing advanced analytics and hit rates. Look for access to insights needed to create internalization strategies around cost optimization in both pre- and post-pay environments. Because workflows differ greatly between payers, ensure configurability in this area to integrate vendor and internal recovery management efforts. Full visibility on auditor throughput and automation to eliminate routine administrative tasks that bog down valuable staff hours are also key. Altogether, this functionality could boost your internal analyst activity 3x.

3. Clinical Workflow and Analytics

Concerns about increasing provider friction keep health plans from taking full advantage of the skilled clinical coders and nurse auditors on staff. The ability to coordinate seamlessly between vendors and internal resources on provider outreach to prevent overlap, internalize the best analytics from all sources, and fully reconcile each audit removes that limitation. In addition, look for A.I.-powered solutions that unlock unstructured text in the medical record to prioritize claims for review. This advanced functionality could decrease your medical expenditures by 2-4% and reduce the chance of errors.

4. Prepay Workflow and Analytics

With as few as 15 days to make a pay/deny decision on a claim, many health plans choose to “pay and chase.” But with time and quality improvements, health plans can move more audit work prepay. Seamless integrations with data sources, post-pay and service vendors will allow for comprehensive audit management. As will automated workflows and clear visibility into timelines and hit rates. Also look for the ability to extend the most successful post-pay concepts to prepay and take advantage of multiple detection sources. With comprehensive payment integrity technology in place, your health plan can put greater focus on internal prepay avoidance, and a 10% improvement is common.

5. Fraud Detection and Case Management

Relying solely on rules-based detection and fragmented case and allegation management tools that silo data unnecessarily stifle the effectiveness of SIU teams. Consider a comprehensive solution that bridges the audit and investigation divisions of your health plan while maximizing efficiencies with case tracking, investigations, and federal and state reporting. Also look for detection capabilities powered by artificial intelligence to dramatically reduce false positives, focus efforts on most likely leads, and surface novel schemes.

Annual spending on artificial intelligence in healthcare estimated to reach be more than $34 billion in 2025. A recent survey of healthcare organizations found 98% have implemented an A.I. strategy or plan to develop one. And 59% of healthcare leaders expect to achieve a full return on their investment within three years. “Will Artificial Intelligence Finally Make Good on Its Promise to Healthcare?”

6. Reporting and Business Intelligence

Actionable business intelligence allows health plans to drive maximum efficiency and effectiveness. Seek out real-time metrics that can be leveraged for accurate reporting on-demand and configurable role-based dashboards to scale business intelligence solutions system-wide.

7. Provider Engagement

Your payment integrity processes have the potential to damage or improve the payer-provider relationship. Features like electronic overpayment notifications, engagement tools, underpayment management and provider self-reporting can streamline your operations, improve provider relations and reduce costs for both parties.

If this functionality checklist covers more than what your health plan currently needs, that’s exactly the point. You should evaluate payment integrity advanced technology based on its ability to scale. It should grow as you grow. That doesn’t mean you have to take on all areas of functionality at once; a modular approach to implementation brings many benefits to health plans.

Get the Checklist

This evaluation criteria is available as a handy download so you can be confident in your payment integrity solution choice.

Additional Considerations to Evaluate Payment Integrity Solutions

A search for payment integrity technology doesn’t stop at functionality questions, particularly as a health plan evaluates various solutions and/or a more comprehensive platform. The feature set alone will not paint the whole picture. To ensure a technology solution meets your needs today and into the future – and fits within the budget – we recommend you look a little deeper.

After evaluating payment integrity vendors based on functionality, the following areas should also be reviewed:

1. Flexibility

Not all payment integrity solutions offer flexibility, which is why some health plans choose to build their own solution. That path, while offering full customization, also comes with some inherent challenges. Read an analysis on the build vs. buy argument here. Flexible, configurable solutions can mitigate the need for a custom build.

2. Total Cost of Ownership

Factor in maintenance, annual licensing and setup costs. Also consider how much investment and effort it will take to improve the technology and its adoption. Combined with any potential financial improvements, how will ROI be impacted?

3. Integration and Ease of System Implementation

What training and support does the solution provider in question offer? How often do they update their platform, and how well will it integrate with current and future suppliers and providers? Look for integrations that can be easily accomplished with low-code tools or simple API connections. This integration standard enables real-time data flow (unlike batch FTP) and can help health plans build a scalable technology stack.

Total payment integrity platforms turn projects that would usually require dozens of integrations into straightforward one-time connections. Integrating accounting platforms, CRMs, service vendor systems, provider systems, claims editors and more with a payment integrity platform provides unique synergies without overtaxing IT. “Why Health Plans Should Choose a Scalable Technology Platform?”

4. User Friendliness

How intuitive is the technology’s user interface and user experience? Evaluate this aspect from the end user perspective as well as managers and decision-makers. Also consider that cloud-based solutions will differ from on-premise in terms of stakeholder engagement, efficiencies and data accessibility. The healthcare industry is increasingly moving all electronic systems to “the cloud” to reduce capital investments in quickly obsolete hardware.

5. Security

Health plans are rightly concerned about data privacy and security. Your technology vendor should have protocols in place to mitigate these concerns. How easy is it to control users’ access and permissions? Look for technologies that allow for controlling access and permissions at object/table-level, at feature-level, and at field-level as well as an audit trail to track changes. Features like single-sign-on, two-factor-authentication, and the ability to insist on password requirements are also ideal.

6. Working with the Technology Vendor

Whether your health plan decides to build its own solution, buy one or subscribe to one, you will be working with this group for years to come. How responsive, reliable and overall customer-oriented are they?

How Does Comprehensive Payment Integrity Stack Up Against Other Solutions?

When we speak with health plans and payers, we find that there’s some confusion surrounding the elements of a robust payment integrity program. Often, they see a claims editor or a FWA tool as a complete payment integrity solution. These tools offer great value but are limited in scope. We regularly uncover gaps and hidden revenue for plans that rely solely on these siloed approaches.

However, a comprehensive payment accuracy platform should seamlessly integrate with these tools to prevent further gaps. Pareo was created to connect external solutions, data streams and third-party services vendors. We recommend you set your benchmark at total payment integrity. But you can use this checklist to evaluate other elements of a payment integrity program.

How to evaluate payment integrity solutions compared to Pareo

Self-developed technology: Self-built payment integrity solutions incur large, ongoing costs for health plans. A self-built solution will require a longer lead time before you can realize ROI. Additional considerations for those considering building an in-house solution are functions that need to be included, expertise, and needed integrations. Pareo can be implemented quickly and offers many immediate benefits to a health plan.

Claims editors: Pareo works in tandem with claims editing solutions by improving their scope and automating much of the workflow.

Fraud tools: FWA solutions, like claims editing solutions, are limited in scope and therefore not comprehensive. They should not be a health plan’s only line of defense in preventing improper payments. If you already use a rules-based tool, you can integrate its data into Pareo.

Third-party services suppliers: A health plan considering third-party vendors doesn’t have to choose between Pareo and their business partners’ solutions. Pareo offers supplier optimization tools that allow for platform integration, improving a payment integrity system’s performance and workflow.



See the ClarisHealth 360-degree solution for total payment integrity in action:

Keeping Up with 2021 Healthcare Payer Technology Trends

Keeping Up with 2021 Healthcare Payer Technology Trends

Reviewing the drivers, restraints, challenges and opportunities for healthcare payer technology in 2021.

Those organizations that kept pace with healthcare payer technology trends weathered the uncertainty of this year relatively unscathed. In fact, 2020 made the strongest case yet for health plans succeeding with technology. If your health plan felt less prepared, you may have increased the intensity of your strategic planning efforts to ensure your health plan is on the right track. To that end, let’s explore the industry drivers, restraints, challenges and opportunities impacting these strategies as we look to 2021.

Drivers: Top Motivators for Health Plans in 2021

We can’t reflect on the past year and look forward to 2021 without addressing the novel coronavirus pandemic. It stands to have an outsized impact on the industry for years to come. And even though it didn’t uncover any unknown issues, it accelerated the need for solutions practically overnight.

Because COVID-19 so efficiently highlighted known gaps in the healthcare system – including how far behind many stakeholders are digitally – it is the source of the primary drivers for healthcare payer technology. Health plans must take care of these in the coming year or risk falling even further behind.

Calls for increased transparency

In 2019, we predicted that "health organizations will need to make real upgrades in technology if they haven’t already, or face issues meeting government regulations.” And in 2020, two rules brought this prediction to the forefront.

First, the rules against information blocking were finalized. Though deadlines for compliance have been delayed, the need for healthcare data interoperability has never been greater. This initiative is poised to solve several of the issues worsened by the pandemic, and health plans will continue to push for increased data sharing. Improvements in care quality and decision-making and progress on value-based care programs should result.

The administration also finalized a price transparency rule. It calls for first posting online documents that include prices for healthcare services and medications. A “shoppable” experience for consumers will follow.

The ultimate goal of technology is to break down barriers and allow information to empower a better healthcare system. Health plans have realized advanced technology is only as good as the data that fuels it. With interoperability, data accessibility and transparency as a focus, health plans will naturally evolve to start questioning any process within their organization that inhibits information sharing.

“Health plans that are able to adapt to these changing trends are far better positioned for long-term success.” FierceHealthcare

Work-from-anywhere environment

Improving data accessibility extends to internal operations at payers as well. The modern work-from-anywhere environment has arrived. The technology that supports it must follow. Health plans have adapted to the “do more with less” credo that pervades most industries, but manual and labor-intensive processes only contribute to the administrative burden.

By adopting integrative technology platforms, health plans can eliminate data silos and improve collaboration and oversight. As payers start to experience the big picture benefits of advanced technology, health plans will be able to work towards becoming more proactive and less reactive.

Changes in membership mix

Health plans have started to experience shifts in their lines of business. This year has brought an influx of members into Medicare Advantage, Medicaid and ACA plans. While severe impacts to employer-sponsored plans have not yet materialized, how consumers think about healthcare coverage has changed for good.

Members are tasked with owning their own healthcare experience and expect the relationship with their health payer to be frictionless and intuitive. Not meeting consumer demand will open payers up to disruption. But if health plans make technology decisions with their eye firmly on the member, they will also find numerous opportunities to improve program integrity efforts.

Changing competitive landscape

Increasing consolidation among health systems and payers is also motivating health plans to innovate. They understand that relying on legacy technology and paper-intensive processes minimizes the ability to scale. Health plans are taking steps now to upgrade their position.

And not a moment too soon. The long-predicted disruption to healthcare has arrived as top retailers have made bigger inroads in the industry. In an increasingly consumer-driven environment, demonstrating value to members and employers is key. Payers with a tech-first mindset – and the ecosystem to match – will have the strategic advantage in these situations.

At the same time, health plans will see more technology vendors looking to leverage experience with other industries into similar successes in the healthcare sector. Technology can help rapidly improve ROI on the claims recovery process. But health plans will need to shrewdly evaluate these solutions to ensure a good fit.

Restraints: Navigating the Roadblocks Health Plans Face

Health plans have long known the advantages of advanced healthcare payer technology. But the usual suspects continue to block progress. Slim margins, data security concerns and shortages in skilled workers could prevent health plans from making headway on their goals this year.

Uncertain medical loss ratios

The uncertainty around how the ongoing pandemic will affect medical loss ratios has some health plans putting strategic technology investments on hold. Profits at most insurers have risen this year, but many industry leaders predict a forthcoming correction. Combined with the historic struggles to efficiently and effectively transition to digital processes, taking on new technology projects may feel too risky in the short-term.

Health plans can overcome this perceived risk by seeking out solutions that surface quick wins and set them up for long-term advantages. Look for speed to value. Enterprise healthcare payer technology that is easy to implement, builds empathy with stakeholders, improves efficiency and reduces team frustration will pay dividends.

Concerns about data security

Dealing with large amounts of patient data makes health plans a prime target for security breaches. And the entire industry trying to quickly integrate numerous data sources has the potential to create vulnerabilities in the system. But health plans moving too slowly with technology adoption can lead to irreparable harm as well.

Current manual approaches to PHI – locally stored data, paper faxes, etc. – are even more vulnerable than secure digital processes. Modern technology, on the other hand, can grant you more control. It allows you to be more granular with granting access to PHI, for one. It also creates a digital log of access. For even greater peace of mind, seek out HIPAA-compliant technology vendors that pursue HITRUST CSF and SOC 2 certifications.

Unexpected costs of outsourcing

The data sharing and transparency regulations and other technology initiatives have payers concerned about how they will pay for and staff these projects. Additionally, health plans will have to overcome learning curves, fear of change and other internal challenges as they select solutions and look for increased returns. The vast majority – 79% – will look to outside vendors to cover these gaps.

Predictable costs will make these burdens easier to bear. Off-the-shelf solutions that are easily configurable will prove more cost-effective than custom-built technology. And a strategic combination of insourcing and outsourcing activity based on health plan core competencies will also optimize spend. A partner and technology that allows you the flexibility to decide – service by service – whether to outsource or insource based on your cost-benefit analysis will better poise your health plan to scale effectively.

Challenges: Factors for 2021

Internal restraints aren’t the only barrier to success with healthcare payer technology. Let’s look at the broader industry factors that could challenge health plans in 2021.

Provider financial instability

So far, providers have borne the brunt of the pandemic financially, and their survival is at risk. Healthcare payer technology strategies will need to support this valuable group. Without a broad network of providers, health plans will find it difficult to advance on engaging members and lowering healthcare costs. Health plans that use technology to focus on this relationship can overcome this challenge. Consider solutions that ease providers’ claims payment administrative burden and support real-time communication.

Slow adoption of value-based care

Value-based care continues its slow adoption among providers. Those participating in alternative payment models performed better than their fee-for-service counterparts in 2020. They also are more likely to pursue population health improvements that stand to keep their patients healthier during the pandemic. But other providers may hesitate to take on more risk.

Health plans can support providers in this transition with healthcare payer technology that overcomes trust and abrasion issues. Increase data transparency so both sides of the relationship are working from the same playbook. Come to agreement on interpretations of value and quality. And measure everything: clinical quality, consumer experience, return on investment, and more. Then share those data insights and work together on continuous improvements and innovations.

Considerations for selection to participate in CMS’ largest bet on value-based care to date “will include an entity's risk-sharing experience, IT infrastructure, compliance and beneficiary engagement.” Healthcare Dive

Uncertain political landscape

A new administration will be in place this coming year, including new leaders at government healthcare agencies. Stabilizing the coronavirus response will likely be the focus of any short-term action, which most healthcare stakeholders should welcome. Whether or not additional burdensome regulations or market changes will be introduced is currently unknown. Agile, tech-forward health plans will be positioned to succeed no matter what happens on this front.

Opportunities: Chances to Excel with Healthcare Payer Technology

While challenges abound in an uncertain healthcare environment, so does opportunity. Changing member behavior and technology advancements may both offer health plans the chance to succeed with their digital transformation goals.

Members open to engagement

One unexpected benefit of this year is how it has opened up avenues for member engagement. People want to hear more from those responsible for their care. They have embraced home health. And they have welcomed technology into their healthcare unlike ever before.

Payers have caught on to the fact that providing improved member services is a differentiator in a consumer-driven market. By offering convenience and addressing social determinants of health, plans can offer broader benefits with perceived higher values while lowering costs. CMS has made it easier for health plans to offer supplemental benefits, another incentive for offering them. With health plans expanding coverage in this area, digital health adoption will continue to grow.

"Leveraging the power of your lifestyle and combining it with research and technology will enable people to take full control in their health journey. With the cost of healthcare rising, providing tools to prevent or reverse diseases that could be costly for patients and the system is a win-win.” Health plan Chief Innovation Officer

Advancements in technology

Technology advancements continue, as API standards are enacted and artificial intelligence capabilities improve. Plans can leverage the mountains of data they collect through improved data analytics technology, reducing time to reports and empowering real-time decision making. And these updates come just in time. Expansion of digital healthcare may prompt more incidents of improper payments and bad actors. But A.I. has also pushed forward opportunities to proactively combat fraud, waste and abuse. By going deeper and wider into the data to push likely leads to you, new schemes won’t pass you by. This improved technology can better integrate the SIU with overall payment integrity as well.

Through secure integrations, data sharing could be a hurdle that health plans finally surpass. Cognitive collaboration capabilities will emerge for health plans if they utilize the right technology solutions. Empowering users to break down barriers within their organization will drive efficiencies and improve the care continuum.

Partner to Make 2021 the Best Year Yet

Health plans can stay ahead of the curve by making strategic investments in change, particularly surrounding transparency. Integrative technology and shifts in program integrity approaches will allow payers to continue to gain ground and focus on proactive efforts, particularly when it comes to claims recovery and payment integrity.

Extending your competitive advantage transcends trends. Fortunately, a comprehensive technology platform like Pareo allows health plans to scale and improve processes, harness the power of A.I., increase medical savings, and accelerate ROI. Talk to ClarisHealth about how Pareo can keep you a step ahead of healthcare payer technology trends – no matter what the future brings.


See the ClarisHealth 360-degree solution for total payment integrity in action:

Increase Agility Around These 3 Hot Button Issues to Minimize Risk in Healthcare and Politics

Increase Agility Around These 3 Hot Button Issues to Minimize Risk in Healthcare and Politics

The 2020 presidential election is upon us, and the debate surrounding healthcare and politics is more contentious than ever. How can your health plan stay ahead of the game, no matter the outcome?

Every 4 years, the cross section of healthcare and politics is put on the national stage. What – if any – impact will the different possible outcomes have on health plans? The uncertainty can bring risk, but potential instability doesn’t necessarily threaten your plans for growth and innovation. Consider your options and keep agile around these 3 hot button healthcare issues to ensure your health plan succeeds in any political climate.

1. Healthcare Coverage

The politics of healthcare are most evident in an issue that signals the greatest threat to the industry: healthcare coverage. Over the past 10 years, the number of people in this country without health insurance has decreased significantly. And, with greater access to affordable healthcare, we tend to see improved outcomes and costs. But the future and structure of major programs that provide healthcare coverage – the Affordable Care Act, Medicare and Medicaid – are all up for debate.

Affordable Care Act

The Affordable Care Act – and the protections it provides – continues to come under fire. The Supreme Court will hear the case shortly and the legislation currently has no replacement if it is struck down entirely. However, many experts find that outcome unlikely, and some parts of it may survive the challenge under “severability.” In particular, it includes several provisions that are popular with the American public and generally increase the number of insured citizens, which is advantageous for health plans:

  • Protections for pre-existing conditions
  • Federal subsidies for deductibles and premiums
  • Children staying on their parents’ plan until age 26
  • Minimum coverage requirements

In fact, in recent years, the marketplace created by the ACA has proved resilient with premiums dropping and more insurers entering or re-entering the markets. And states have stepped in to prevent the complete unraveling of progress made under the ACA, no matter how it fares in the courts. In 14 states, these provisions promise to fully cover potential gaps. Otherwise, 47 states have extended cost sharing reductions tied to silver plans, 36 have ensured young adults can stay on their parents’ plan, and 21 have allowed for a full or partial ACA exchange.

Medicare and the public option

While the so-called “Medicare for All” seems to be off the table for the time being, changes to Medicare itself are still a distinct possibility. Some policies, such as extended telehealth and supplemental health benefits, have bipartisan support and are expected to continue. However, falling tax revenues have accelerated the program’s insolvency timeline to 2024, and the aging population means Medicare spending will rise from 15% of federal spending in 2018 to 18% in 2029.

But while there are no plans currently on the table to shore up Medicare, it’s politically risky to alienate the senior voting bloc. And one proposal actually plans to extend eligibility for the program to those age 60-64, though it would be financed separately from Medicare. Many insurers have seen significant success with their Medicare Advantage lines of business, so this expansion could prove lucrative.

Could the related “public option” be equally advantageous for health plans? According to a Times/Siena College poll, more than 65% of U.S. voters favor a government health-insurance plan anyone can buy. Private insurance would continue under this program. Deployment could look like a public-private choice model, a targeted choice option that strengthens the ACA, or applying Medicare-based rates to certain private insurance claims. As an executive for one of the major insurers explains, “We've had public options and done well in public options. So history says that's fine.”

Medicaid cuts and expansion

At present, 38 states have expanded Medicaid under provisions allowed for by the ACA. The current administration’s efforts to cut Medicaid – namely block grants and work requirements – have proved unpopular and have faced legal challenges. We can expect proposals that increase Medicaid funding for home- and community-based services. And, under the public option mentioned above, individuals not covered by expansion would automatically be enrolled under that program.

Under our healthcare system, individuals, providers and payers tend to fare worse when there isn’t a broad base of people with access to affordable healthcare. Patients tend to defer or delay care due to cost, which makes their conditions more expensive to manage later on. And hospitals struggle with financial stress resulting from an increase in uncompensated care.

Stay agile around shifting healthcare coverage: Leverage data insights to predict long-term changes in stakeholder behavior and pursue targeted member outreach. Automate processes and workflows to reduce administrative complexity that can arise in the fallout of healthcare and politics.

2. Value-Based Care

With the fate of the ACA in question, what happens to the Center for Medicare and Medicaid Innovation? The CMMI is the innovation arm of CMS that has led many of the payment models for value-based care. Value-based care has received support across the political spectrum, so we can expect it to remain in some form. How it's structured and administered, however, could change.

Current CMS administrator Seema Verma indicated value-based models in the future will incent providers to take on more risk. This evolution comes as data from these models show that while they improve outcomes and quality, not all save money. But some payers have reported significant cost savings from value-based care. And with providers participating in alternative payment models faring better during the pandemic, progress in this area could accelerate.

Stay agile in value-based care: Payers should improve their two-way data sharing with providers to increase trust and ensure mutual success under these arrangements.

3. Healthcare Costs

One bipartisan issue in healthcare and politics is both parties want to reduce costs. Policy records and proposals focus on prescription drug costs, price transparency and healthcare affordability. But approaches to this hot topic vary, and the novel coronavirus pandemic has further complicated the matter.

Prescription drug costs

Of Medicare beneficiaries that have reported struggling to pay for healthcare, for 59% of them that bill was for prescription drugs. There is broad support for bringing down drug prices, but the road to realization can be long, largely due to legal challenges and long implementation timelines. Early in 2020, makers announced price hikes on almost 450 drugs.

Both candidates support capping Medicare Part D spending, importing certain drugs, establishing international reference pricing, allowing pharmacists to counsel on cost saving opportunities, and encouraging earlier availability of generics and biosimilars. But they disagree on whether the government should negotiate drug prices directly and how or if rebates and discounts can be passed along to patients.

Price transparency

As healthcare costs rise, patient consumerism is rising in tandem to ensure they can afford the care they need to receive. Two initiatives promise to support this activity: price transparency and ending surprise billing. These issues have broader bipartisan support than some of the other topics we have discussed here, but the industry disagrees on how these should play out, which has stymied progress.

The Price Transparency Rule requires that hospitals publish payer-negotiated rates for 300 shoppable services, 70 of which are mandated by CMS, by early 2021. Payers can do their part by moving early on the corresponding rule. With an emphasis on the member experience, health plans can comply with data sharing mandates and satisfy demands for consumer-driven cost management.

Surprise billing bans require legislation, which stalled in favor of the coronavirus response. Both parties support eliminating out-of-network charges from certain providers that patients have little say in choosing. Payers and providers will likely need to collaborate on this issue to ensure an outcome that best benefits consumers.

Healthcare and coverage affordability

COVID-19 has dramatically affected the finances of many employers, consumers and providers. As a result, the affordability of care and insurance coverage is top of mind even more than usual. Senior consumers report issues paying for premiums and other out-of-pocket costs. And younger consumers aren’t exempt, with over a third of those under 40 reporting an impact to their health insurance.

But will the cost proposals outlined above make healthcare and coverage more affordable for consumers? Reducing prices should increase affordability, but much depends on how they are implemented. So far, according to a recent analysis, insurers believe healthcare costs will remain lower than usual into 2021, which could offset increased costs for COVID-19. As a result, premiums have increased only modestly. Additional proposals that increase competition, extend subsidies or cost-sharing assistance, and cap premiums at a percentage of income would also help on this front.

Stay agile around healthcare costs: Consider adopting advanced technology that puts you in control of your claim spend and reduces your administrative burden. Integrative platforms that harness the power of A.I. allow you to scale payment integrity efforts.

Minimize the Risks of Healthcare and Politics with Pareo

In this environment of a shifting member population, increasingly complex value-based care models, and instability on the COVID-19 and cost fronts, how will you minimize your risks in healthcare and politics?

Solutions that emphasize innovation and agility will win, no matter the political landscape. Advanced technology that provides real-time insights and harnesses the power of A.I. will better position you to maximize avoidance and recoveries at the most optimized cost. Payment accuracy technology platforms like Pareo enable you to focus on your health plan’s strengths and lean into your competitive advantages.




See the ClarisHealth 360-degree solution for total payment integrity in action:

Your 5 Point Clinical Audit Checklist to Reduce Provider Abrasion

Your 5 Point Clinical Audit Checklist to Reduce Provider Abrasion

In part 2 of our series we outline exactly what health plans should look for in an advanced technology platform for clinical audit

Paying claims right the first time – while making the most of internal resources – is the primary goal at most payer organizations. But, how can you best accomplish that payment accuracy ideal? In our previous article on the topic, we explored several trends that affect typical claims validation processes. To answer these challenges, many health plans are considering an integrative advanced technology platform that supports all stakeholders. This 5-point clinical audit checklist shows you exactly what to look for in a solution and what you can expect to gain. Namely, seamless collaboration between auditors and services suppliers and timely communication with providers.

5 Ways to Streamline Clinical Audits: Checklist

When it comes to maximizing payment integrity results, you may have run into a few hurdles. We find these issues tend to come down to a single root cause: manual processes. These labor-intensive workflows produce a direct hitto your bottom line in the form of decreased clinical auditor productivity. That cost is worth addressing on its own, but it pales in comparison to provider abrasion costs. The good news is the five features of this clinical audit checklist ensure necessary payment accuracy processes while addressing both of those costs.

1. Automate workflows

Even straightforward claims auditing workflows involve multiple stakeholders. Relying on spreadsheet and email tools alone perpetuates work silos and prevents true collaboration. On the other hand, an integrative technology platform can automate even the most complex workflows. This automation provides secure data access and streamlines auditor communication and activities with clear inventory assignments.

These workflows allow for sophisticated routing by audit type and configurable user profiles. Prioritized work queues with overlap control ensure internal auditors or third-party suppliers don’t work the same claims at the same time. And automated processing of all analytics and claims inventory generates results for audit and validation in real-time.

These workflows also can prevent duplicate medical records requests that can sometimes result from multi-pass audit processes. In Pareo, smart tagging triggers a nurse audit review when a medical records request is initiated, and all relevant data is easily accessible to support a quick determination. To close this loop, the auditor can generate refund letter requests to the provider including supporting clinical information. By initiating recoupment and recovery services all on the same platform, full overpayment tracking and reconciliation can occur with no gaps.

2. Validate and internalize complex analytics

Every health plan wants to build an arsenal of advanced claims concepts. If your health plan doesn’t have dedicated data science expertise, or claims auditing shares this resource with other departments, this goal can seem insurmountable. 

Pareo provides a transparent view into which analytics offer the most value to your health plan. Moreover, you can maintain a centralized electronic library of queries – no matter their source – organized by category and tracked by active status. This access allows you to maximize analytics across all lines of business to gain insights into hit rates and improve accuracy.  

3. Transition to more prepay claims validation 

Manual, labor-intensive processes make it particularly difficult to make progress on prepay claims validation goals. The tight turnaround times require streamlined workflows and high-quality proven concepts – for both data mining and complex medical records reviews. As a result, many health plans find it easier to let third-party suppliers handle this function. 

But, by leveraging the automated workflows and advanced concepts enabled by Pareo, you can better position your team to transition more claims work to prospective validation. Any post-pay concepts and processes that are particularly successful – as validated through real-time claims visibility – are ripe for this move. And the concepts repository in Pareo can apply to prepay workflows as easily as post-pay. A 10% improvement in claims recovery often occurs when health plans optimize their mix of prepay payment accuracy. 

4. Blend outsourced and insourced activities to maximize efficiencies 

You want to be able to base your decisions on what audit activities to bring in-house on cost-benefit analysisAn integrative technology platform based on transparency provides the detailed insights and collaboration to support those goals.  

Pareo features smart staffing analysis that allows you to track internal auditor productivity in real-time and better understand metrics that drive efficiency. Audit time vs. system time, auditor activity (refunds per hour), average refund value, claims-to-refunds rate, time-based metrics and more show you exactly when it makes sense to expand internal efforts. 

While you’re ramping up internal auditor efforts and expertise, strategically stacking vendors lets you accelerate your audit goals at scale. And, when it’s all managed through Pareo, you have the flexibility to decide – service by service – whether to outsource or insource or combine the two approaches.

5. Access A.I. for insights into unstructured text 

As much as 80% of relevant clinical information is stored as unstructured free text. Manually evaluating hundreds of pages of medical records and other supporting documentation can result in inefficiencies and lead to inconsistencies in audits that create unnecessary friction with providersBut by digitizing clinical content to take advantage of advanced A.I. capabilities, you can minimize the provider burden. 

Pareo integrates OCR technology powered by NLP and machine learning applications of A.I. that make the most of your valuable experts’ timeThis multi-faceted approach includes keyword-based methods, outlier detection, context dependenceand validation against national databases and other external references. Along with making the data searchable, filterable and sortable, it creates a strong foundation for flagging suspect charges. 

These audit validation enhancements unlock previously “unreadable” text – including data from images – while also creating more standardized audit processes and decision making: 

  • Prioritize cases for review 
  • Automatically identify and tag relevant documentation 
  • Generate confidence scores for denial decisions 
  • Continuously “learn” from your auditors’ feedback 

Pareo Improves Auditor Efficiency and Provider Burden 

Every stakeholder recognizes the necessity of claims audits. A well-rounded audit program that ensures the best possible payment accuracy rates doesn’t have to burden your staff or valuable network providers. In a recent study, 50% of providers reported that “they prefer working with payers and auditors that communicate thoroughly, provide comprehensive responses to appeals, and use staff with medical records.” This clinical audit checklist will help you accomplish that ideal.

The Pareo Audit and Clinical suites support all five features on this clinical audit checklist so your health plan can conduct data mining, itemized bill review, DRG and other audits to maximize your return on claim spend. All fully integrated on the Pareo advanced technology platform for an end-to-end payment integrity solution. 




See the ClarisHealth 360-degree solution for total payment integrity in action:

Diving Deeper into Healthcare Claims Audits: Part 1 – Auditor Workflow

Diving Deeper into Healthcare Claims Audits: Part 1 – Auditor Workflow

The first installment in a multi-part series aimed at clinical auditors. Part 1 takes a closer look at 5 trends impacting how health plans manage claims auditing today.

Claims auditing. It’s the core function of any health plan payment integrity operation. Ensuring healthcare claims are paid accurately, both prepay and post-pay, requires claims auditors to determine the correct party, membership eligibility and contractual adherence, as well as detect and prevent fraud, waste and abuse. It’s a tall order, and numerous obstacles stand in the way of performing this task efficiently and effectively.

In this first installment of a three-part series, we explore the landscape of a claims auditor’s day-to-day, including new challenges and opportunities and how current solutions stand up to these changes.

Here are the top 5 trends we have identified that impact payment integrity claims review and validation.

Moving Prepay

Long an unattainable goal, health plans are now making significant moves to transition claims recovery to an internal prepay model. Claims auto-adjudication systems are a good first step to achieving this goal, but lack of data visibility throws up major barriers to health plans endeavoring to make real progress.

Too many health plans lack dedicated data science resources to develop and test sufficient prepay concepts. And, even if they have insights on their most successful post-pay concepts, there may be no ability to store those and apply them prepay. For health plans that have implemented technology, unless those systems seamlessly integrate, achieving significant cost avoidance is difficult.

Altogether, these manual processes and tight turnaround times add up to pay-and-chase, a prevalent and unsustainable way of processing claims that auditors alone have little power to impact.

Working Strategically with Vendors

While some health plans completely outsource their claims recovery efforts to service vendors, and others aspire to internalize 100% of those activities, a blended approach likely yields maximum recoveries at the most optimized cost. Provided your health plan has efficient and transparent methods for communicating, preventing overlap, and evaluating results with vendors.

Unfortunately, managing suppliers with spreadsheets, status emails and quarterly business reviews keep vendors and internal auditors at odds. To get the most out of your vendor partnerships for claims audits, health plans need to find effective ways to ensure mutual value:

  • Share goals
  • Communicate clearly and consistently 
  • Set expectations on service level agreements, contract terms, etc. 
  • Pay on time 
  • Train vendors on your processes and seek to understand their business, too  
  • Ensure accountability on– both sides  
  • Hold meaningful strategy sessions rather than status updates

Types of Claims Audits

Claim edits focus on service dates, revenue codes, procedure codes, modifiers, type of bill, units of service, diagnosis, member eligibility, historical claims data, medical necessity, and more:

  • Non-Covered Services According to Plan Policy
  • Authorization (Days, Level of Care, etc.) 
  • Procedures/Charges 
  • Duplicative Procedures/Charges 
  • Coordination of Benefits 
  • Insurance Liability and Recovery (Subrogation) 
  • CMS National Coding Correct Initiative (NCCI)
  • Medicare Procedure-to-Procedure (PTP)
  • Medicare Add-on Code Edits
  • CMS Professional Component/Technical Component (PC/TC)
  • CMS Global Surgery

Minimizing Provider Abrasion

Health plans are increasingly focused on their provider relationships, not least because members demand a healthy and satisfied provider network. At the same time, claims recovery processes tend to be structured to achieve the opposite, despite auditor best efforts.

It is hard to link specific language from a provider contract within the claims process if plans are not using OCR technology. And, activities like overlapping medical record requests or requesting full records, just in case, and sending generic letter denials that require significant lift from provider claim departments can undermine these valuable provider relationships by dramatically increasing cost and abrasion.

In fact, a recent study found that nearly 1 in 5 providers spend over $500,000 annually on the post-payment audit process, and almost 40% of providers can’t or haven’t calculated the cost.

The breakdowns in communication that prove costly to providers wreak havoc on health plan bottom lines, too, by minimizing auditor effectiveness and productivity.

Breaking Down Work Silos

Many of the issues preventing health plans from achieving goals in relation to the trends outlined in this article come down to one simple operations issue: work silos. Some of these silos are cultural: multiple departments in a health plan responsible for different areas of claims payment integrity don’t work together towards their common goal. Others are structural: claims auditors using different systems that don’t talk to each other, which can complicate good faith agreements and fail to align teams more closely.

No matter the source, work silos make it difficult for auditors to get true insights into where inventory is and what claims are being worked, as well as the status of those claims. In this environment, it's also near impossible to share relevant insights across the organization.

Transparency is the new business paradigm, especially when designed to empower each stakeholder to offer their maximum value.

Reducing Administrative Burden

How much time do your auditors spend working claims versus updating spreadsheets and tracking down status updates? For many health plans, working with claims, suppliers, providers and other departments, are all juggled with a collection of vendor, internal and offline systems.

Manual workarounds that increase administrative complexity prevent auditors from focusing on core jobs. Moreover, these activities can’t be easily reported on, making it difficult for health plans to smartly staff internal departments and confidently evaluate vendor performance.

Your health plan is not alone. About $330 billion is wasted every year on administrative complexity, or 10% of annual healthcare spending in the U.S. A significant portion of this waste could be addressed with integrative technology to break down data silos, robotic process automation to automate repetitive tasks, and visual reporting to gain a clearer picture of what’s working and where improvements need to be made.

Next Steps

In part two of our series on healthcare claims audits we will look at new solutions that have emerged to address these trends head-on, solutions that promise to increase auditor productivity exponentially.


See the ClarisHealth 360-degree solution for total payment integrity in action: