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Automating the claims adjudication process to strengthen provider relationships

Andria Picture
Andria Jacobs, Chief Operating Officer, PCG Software

Tuality Health Alliance is a physician-hospital community organization (PHCO) that includes approximately 80 primary-care physicians and 200 specialists. Based in Hillsboro-Ore, Tuality represents the interests of patients, physicians and other care providers with many national and regional insurers and health plans, and is responsible for effective medical management and quality improvement services. They are also the plan administrator for Tuality Hospital’s medical plan.

Because of the small size of the administrative staff, Tuality’s Chief Operating Officer Chris Senz and Operations, Data and Reporting Manager Julie Spiert were eager to uncover new ways to automate the various manual processes Tuality currently had in place. Because of the industry’s rapid transformation over the past few years, there was also the need to contain costs to remain competitive, while protecting themselves from becoming yet another headline related to the billions of dollars lost each year to fraudulent, abusive and wasteful healthcare billing practices.

After a thorough review of vendor alternatives, Senz and Spiert reached out to the Las Vegas-based PCG Software for an evaluation of the organization’s existing claims operations in 2014. The consultants at PCG Software ran a comprehensive review of all Tuality claims data from 2012, and returned with some eye-opening results. After running the already-paid claims data through its flagship software platform, Virtual Examiner (VE), PCG Software identified dozens upon dozens of instances where Tuality should have rejected submitted claims, or in many cases, should have paid a lesser amount. The bottom line? PCG Software identified a cost savings opportunity of nearly 10 percent for that year – equating to hundreds of thousands of dollars Tuality could have saved, if the system was in place at the time. It was a convincing argument.

The COO quickly moved to install and implement the Virtual Examiner software that year, and identified three major areas of focus:

  • reduction of fraud, abuse and waste;
  • automated claims adjudication and auditing; and
  • cost containment.

It was determined that by increasing efficiencies in each of these areas, Tuality would be able to greatly enhance their bottom line year after year – which can certainly add up – even for a small Medicaid health plan.

“Because Tuality previously relied on a manual process, the adjudication work done by our claims staff wasn’t nearly as comprehensive as what Virtual Examiner could do because the steps involved are so labor intensive,” explained Senz. “At Tuality, it is important to us that we never get behind the curve. We’re committed to always staying on top of the national and statewide CMS updates, but as others in this industry have found out, there are just too many for a claims team to keep up with without automation. PCG Software provides that access through not only the VE system but also with their vast healthcare expertise and we were able to quickly establish a strong level of trust with them.”

The company’s claims adjudication software allows healthcare organizations like Tuality to enhance their current claims adjudication system with more than 33 million edits per claim. The platform monitors the organization’s internal claims process to identify unclean claims and reduce payment for improper or erroneous coding to conserve premium dollars. As a cost containment solution, VE evaluates each claim not only for abusive billing patterns but also identifies those claims that may involve third-party liability/coordination of benefits, case management opportunities and many other cost recovery reports. The software is also designed to improve the quality of encounter data and reporting by identifying coding errors, deleted codes and missing data elements.

In addition, the customized version of VE now helps Tuality to enhance the relationship it has with its provider network by educating individual providers on proper billing practices and improving the physician office staff’s understanding of coding and claims payment guidelines.

Senz added: “Simply put, the job of our new software is to find additional and significant cost savings that we wouldn’t have been able to find through traditional and manual processes. It has successfully done this month after month since its installation, and we’re very happy with the relationship we’ve established with the PCG Software team.”