Approaches for Building Insurance Benefit Information into the Revenue Cycle
By Barbara White

The discussions of health care reform in recent months have included much talk of the so-called ‘out-of-pocket’ costs for patients - non-covered services, high deductibles and co-insurance or copays. While we don’t yet know the substance of healthcare legislation under discussion or its impact, Epic customers can build some or all of these out-of-pocket costs into the system to facilitate patient accounting and to make record-keeping easier for the patient’s family.

When hospital systems or provider practices think about building benefits structures into their revenue cycle systems, most of us probably think first about copays. And while copay calculation is a key function of a good benefits build, there may be numerous other pieces, including:

• Designation of non-covered services as billable to family rather than to insurance
• Capitation write-offs for services covered under Capitation contracts
• Referral alerts or Out-of-Network alerts
• Co-insurance or Deductible adjudication
• Benefits with limits/metered benefits (i.e., number of physical therapy sessions paid per year)

These features can be used with Professional Billing and appropriate features can be used with Hospital Billing. Your organization’s approach to benefits build can be more tailored or more generic, depending on the information available. When selecting an approach, you should keep in mind:

• The detailed information that is or is not available, regarding the insurance benefits for plans in which most of your patients participate. If you do not have access to accurate and timely information, your benefits build may need to be more generic.
• Whether most of the insurance plans in your area, especially those used by patients at your facilities or practices, are high-deductible, HMO, POS, PPO, fee-for-service, Medicaid or Medicare plans or a mix of different types of plans. The more precise information you have, the more powerful your results will be.
• The resources needed to maintain benefits build, considering the flexibility needed to update it and accuracy of information sources for patient benefit plans

The Tailored Approach

Organizations which operate as both payors and providers may benefit most from this approach, since they will have very specific benefits information for those plans that they administer. All of the features above can be built into the system and maintained more accurately since precise and timely information should be internally available and does not depend on cooperation from payors outside the organization. Staff must be dedicated to this build, especially for provider networks, since information will change regularly.

The Generic Approach

If your organization does not have a division that administers plans, than you may be happier with a more generic approach. Some of the above features can be built into the system, with copays set manually by check in staff in a table stored in the patient’s registration. Once stored, the copay calculates at every check-in until changed. The system’s alerts can be configured to distinguish between Medicaid, Medicare, and Managed Care, high deductible or fee-for-service plans. Even when detailed plan information is not available, provider bulletins or payor website information can be used to set up alerts for the check-in staff or to not calculate copays. For instance, an HMO plan that requires referrals for specialist visits can be set up with referral alerts when they are typically needed. Similarly, Medicaid or Medicare plans can be set up to not calculate copays or alerts for referrals.

Considerations

• From a patient accounting perspective, accurately calculating copays at Check-in allows them to be matched to the appropriate service and reduce the A/R by the matched copay amounts. If your organization is using automated remittance files, you will need to ensure that remittance codes on the Payor EOBs are in sync with the benefits build.
• For patients covered by multiple plans, your organization will need to decide whether to calculate copays at check-in or configure the system not to calculate them.
• Staff dedicated to reviewing and troubleshooting the impact of the build and updating it in response to business needs should be integrated into the revenue cycle team since benefits-build touches the entire Revenue Cycle.

Benefits-build can be a powerful tool to incorporate out-of-pocket payments by patients/guarantors into the Revenue Cycle. With careful planning, the right approach and strategy for your organization’s benefits-build will also help produce correct patient statement, so that patient families find it easier to anticipate and manage the out-of-pocket costs determined by their insurance coverage. If you have any questions or need more information please contact VCS at vcs@getvitalized.com.