Health insurance companies can take weeks — or months — to reimburse physicians, leaving some so frustrated that they refuse to accept insurance plans at all. And that’s pressuring insurers to offer faster, more convenient digital disbursements. In the new B2B Healthcare Payments Report, Brett Lotito, vice president of insurance operations for Oscar Health, discusses how the tech-focused startup is using physician portals and automated claims review to get doctors paid electronically — within days.
Payments between insurance companies and their healthcare provider partners can cause stress for both parties. Delays always exist between treatments and compensation, and that lag can strain budgets as healthcare providers must continue with their regular purchasing and payroll obligations while waiting.
Physicians who become too frustrated by the administrative headaches of filing claims and fighting rejections may even decide against accepting insurance plans entirely, preferring to limit their customer reach rather than suffering reimbursement hassles.
Insurance companies must make these processes as swift and convenient as possible to retain and grow their healthcare provider partners. PYMNTS recently caught up with Brett Lotito, vice president of insurance operations at health insurance company Oscar Health, for greater insights into the challenges insurers face when providing speedy compensation.
Letting Data — and Money — Flow
Approximately 375,000 individual members are currently enrolled in Oscar Health’s plans, and the company serves an additional 20,000 patients through Medicare Advantage and small-group insurance. Claims disbursements to these patients’ providers can hit snags when data is missing or unclear, though.
“When it comes to paying our provider partners, health insurance companies like Oscar face very similar challenges to what members face when going to get care,” Lotito explained. “The underlying healthcare system is broken, and data systems are a bit disparate.”
Insurers assess claims before issuing funds to determine whether treatments were genuine medical necessities covered by their contracts, and they must also ensure that they possess all the data they need about providers. Firms must double-check information about providers’ systems and ensure that addresses and specialties are accurate.
Oscar Health takes a technology-based approach to tackling these tasks, creating a digital portal that healthcare providers can use to update details and verify the kinds of submitted evidence they will need to justify different treatments. This ensures that providers include all necessary information in their claims, reducing rejection odds. They can also use the portal to confirm the services covered in different patients’ plans, which is helpful in comparing care options.
The company also tries to automate its assessments to be faster than manual review processes. Oscar Health automatically adjudicates approximately 92 percent of submitted claims, compared to only 60 percent three years ago, Lotito said. Technology has enabled the insurer to reduce claims processing windows to a median of five days.
“We try to codify the decisions that [our claims processing teams] need to make based on the data that drives the workflows they have,” he explained. “If we can codify appropriately, we can then use our systems and tools to automate those decisions. That’s a way we can drive the average [claims processing time] way down.”
Issuing Funds
Oscar Health prefers to pay its partners’ approved claims digitally through automated clearing house (ACH) transactions or via The Electronic Remittance Advice (ERA), or 835, an automated electronic funds transfer system commonly used for healthcare claims payments.
Digital transfers are quick, low-cost and easily trackable, and can deliver payments with little lag between issuing and receipt. Healthcare provider partners frequently want to know when — or if — they can expect reimbursements, so solutions with only minor latency periods are particularly useful.
“We’d much rather do electronic payments [so] we can track that payments go out and providers receive them,” Lotito explained. “We try to steer as many of our providers as we can to electronic payments, because that way we can communicate more information to them about what we paid for, how we paid for it, why we covered it in a certain way or why we didn’t cover something. [Digital payment methods help us] make sure we are paying claims accurately and compliantly with all the markets we are operating in — and, clearly, so the players know what decisions we’re making and why.”
Healthcare providers across all markets and types do not mirror insurers’ electronic payment demands, he added. Oscar Health has found that many still have systems geared toward manual payments, so the firm believes its offerings must meet these differing needs.
The B2B healthcare payments market is complex, and many insurance companies and healthcare providers are striving to achieve more streamlined claims processing and easier, swifter reimbursements. Much work remains, but stakeholders are already making strides. A willingness to seek out technological tools to support fast and flexible disbursements may go a long way toward making B2B healthcare payments easier for all involved.
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