The Washington, D.C.-based Committee on Operating Rules for Information Exchange (CAQH CORE), an alliance of health plans and trade associations, has produced a new report analyzing the forward evolution of the automation of health plan-provider administrative processes.
CAQH CORE, which describes its mission as an ongoing effort to “drive the creation and adoption of healthcare operating rules that support standards, accelerate interoperability, and align administrative and clinical activities among providers, payers and consumers,” as “an industry-wide facilitator of a trusted, simple and sustainable healthcare data exchange that evolves and aligns with market needs,” has released a new report looking at the cost of administrative transactions in healthcare, and offering insights around several key administrative costs.
The CAQH 2019 Index, released on Jan. 21, found that “Of the $350 billion dollars widely cited as the cost of administrative complexity in the US healthcare system, $40.6 billion is spent on eight administrative transactions. Of that, the industry can save $13.3 billion, or 33 percent of existing annual spend, by transitioning to fully electronic processes. While the industry has already avoided $102 billion annually by automating administrative transactions, significant opportunities for additional savings remain for both the medical and dental industries.”
As the announcement on its website notes, “The Index analyzes levels of automation, spending and savings opportunities for eight administrative transactions related to verifying patient insurance coverage and cost sharing, obtaining authorization for care, submitting claims and supplemental information and sending and receiving payments. Of the $13.3 billion in potential savings through automation, $9.9 billion can be saved by the medical plans and providers, while $3.4 billion can be saved by the dental industry. In both industries, the greatest savings exist for providers as compared to plans.”
Further, the announcement noted, “The 2019 CAQH Index proposes actions that can most significantly reduce provider burden and support the automation needs of the medical and dental industries. It also includes a call to action for greater collaboration across industry stakeholders to harmonize and accelerate approaches that can accommodate emerging market needs. For example, standards and operating rules must be updated more quickly to support changing technology, payment models and patient care delivery strategies.”
The full report notes that, “While medical plans experienced a steady increase in electronic adoption for five transactions, two transactions saw a one-percentage point decrease in electronic adoption for five transactions, two transactions saw a one percentage point decrease in electronic adoption and one remained stable. Claim payment and coordination of benefits (COB) saw the highest increases in electronic adoption, by seven and six percentage points respectively. Adoption of electronic remittance advice rebounded three percentage points after an eight-percentage point drop in the last report.”
Specifically, the percentage of fully electronic processes on the part of health plans was as follows in 2018: eligibility and benefit verification, 84 percent; prior authorization, 13 percent; claims submission, 96 percent; coordination of benefits, 86 percent; claim status inquiry, 70 percent; claim payment, 70 percent; and remittance advice, 51.
