Attach and conquer

Jan. 1, 2011

Four reasons why implementing a strategy for 275 compliance can drive cost savings this year.

Thomas W. Hughes

Today, the secretary of Health and Human Services has the 275 mandate on her desk, ready to be signed. The question is not if, but when these requirements will be enacted. So what does this mean for healthcare providers and claims processing?

With 275, payers would be required to accept six medical electronic attachments in a standardized format. The six standardized attachments include lab, ambulance, emergency department, rehabilitation, clinical and medication reports.

For many, more red tape and mandates from the government can create frustration and headache. But this mandate is decidedly different. The implication of requiring standardized attachments lends itself well to establishing protocols for electronic attachment submission. By making this submission process available, providers will be able to submit their attachments in less time with the initial claim submission. They will avoid the cost of postage and the risk of lost attachments. Submitting attachments electronically will also enable providers to receive reimbursements more quickly and eliminate time on the phone with the payer's help desk, tracking down lost attachments.

In short, by getting onboard with the 275 requirements now, payers and providers can not only obtain compliance for the future, but also positively affect the bottom line. There are four specific objectives that can be achieved:

Save time and increase
capacity for claims submission

Every day that a claim goes unpaid, money is lost. By utilizing an electronic attachment process with standards-based formatting, providers will reduce the amount of time it takes the payer to adjudicate claims, decreasing reimbursement time almost immediately.

Additionally, the amount of claims that an insurance reviewer can process in a day is restricted by the use of paper and other attachments. Increasingly, business models call for an increase in revenue streams through additional services and service lines available to patients; it logically follows that operational costs will also increase. By utilizing electronic claims and implementing an electronic attachment solution, the number of claims each team can submit without increasing head count or staff will increase.

Eliminate lost attachments

Paper gets lost, period. Whether it is held up with the postal service, sits on someone's desk or is filed in the wrong place, paper attachments have a way of not making it to the claims reviewer. The result is more than just the hassle of resubmissions due to lost attachments — it costs money. Delays in payment — as well as administrative costs to copy, process and mail a second request — add up fast. Keep staff focused on filing new claims, not tracking lost items with the insurance companies.

Get paid faster

Because patient information is automatically filed away in a digital format, it only takes a few clicks of the mouse to include the electronic attachment ID in the PWK segment of the 837 file. Comparatively, printing attachments and mailing them takes time to prepare. Attachments spend days in the mail system and then they must be opened, indexed, sorted and then entered into the adjudication system by the health plan's mailroom staff. With standard, electronic attachments, departments can shorten that cycle, resulting in faster reimbursement. At Medical Electronic Attachment (MEA), clients who utilize the electronic attachment solution are able to reduce their outstanding receivables by 10 to 14 days. The resulting improvement in cash flow can be critical to any organization.
Cut operational costs

Utilizing electronic attachments is less expensive than paper. We have already discussed the time savings in personnel costs, but there are also significant operational cost savings as well. MEA charges their institutional clients a nominal fee per transaction. This is not a per-page fee, as a transaction can contain hundreds of documents. Whereas, if you send paper copies through the mail system, industry studies estimate that this costs a minimum $1 per claim, just for paper and postage. In addition, many institutions are mailing these attachments via certified mail. Whether you have hundreds or hundreds of thousands of claims each month, the cost savings will significantly affect the bottom line.

There are changes coming quickly. The Huffington Post reported in March 2010 that the healthcare reform bill would cost taxpayers $940 billion over 10 years. After a tumultuous year of policy change in the healthcare and health insurance industries, a revolutionary idea that promotes streamlined efficiency is critical.
Don't wait for the government to mandate how you operate. Develop a strategy today to integrate electronic attachments into your operations to provide cost savings and efficiencies.

Thomas Hughes is
founder and CEO,
Medical Electronic Attachment.
For more information on
MEA solutions:

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