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Payers Providers

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by

Iqra Tehreem

on 30 June 2013

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Transcript of Payers Providers

The Modern Business Practice
of Medicine

?
insurance companies are winning
the Payer-Provider dynamic
AND
what to do about it
$2.1 trillion – 2006
Projected $4 trillion by 2015
Turning
What can individual practice owners learn from PacifiCare audit?
1.1 million paid claims
June 2005 - May 2007
Coverage:
190,000

members in PacifiCare's
HMO
and
PPO
plans
the
Tables
Around
Healthcare Costs Grow Fast
Faster Than Inflation
Faster Than Physician's Compensation
In fact,
physician’s reimbursement is
shrinking
What is the fastest growing cost component?
Insurance Premiums Grow
Faster than Any Other Indicator
% Growth 2001-2006
% Growth 2001-2006
% Growth 2001-2006
How do Payers make more money?
#1. Use the
Float
Float
makes up to
50%
of the Profits.
What is the
Float
?
Float
is the money earmarked for payment
for healthcare but not paid yet.
The
longer
payers hold on to the Float
– the
more
profit they make.
Payer’s challenge:
the time they
Our Challenge:
the time payers
PacifiCare
California - 2007
1.1
million paid claims
June 2005
-
May 2007
The joint Department of
Managed Health Care and Insurance Department
audited 1.1 M paid claims
133,000 violations
1.1 million paid claims
June 2005 - May 2007
1.1 million paid claims
June 2005 - May 2007
1.1 million paid claims
June 2005 - May 2007
133,000 violations
30% wrongly denied
133,000 violations
30% wrongly denied
29% of the disputes
handled incorrectly
PacifiCare Fined $3.5M
A Large Organization Has Successfully
Turned the Tables Around
on an Insurance Company
First, we need to understand,
how do payers rig the game and stack the cards?
Tilted Playing Field
Payer’s Winning Methodology
Has Four Components
2006 - $3.1 Billion
2003 - $1.8 Billion
1993 - $155 Million in false claims
Idea!
Watch Concept animation:
Members of Billing Networks
Share a Cloud Based System
Members of Billing Networks
Aggregate Claim Volume to
Discover Abuse Patterns
Members of Billing Networks
Leverage a Shared
Billing Knowledge Base
Billing Networks
Level the Playing Field
with Payers
Client Testimonial:
Visit our website:
http://www.affinitybilling.com
More in my book:
Float
continues to be invested
until it is paid
Shrink
hold on to the float
Increase
hold on to the float
Compensation:
more than $500 millions since 1992
More than $1 billion worth of options
Lump-sum payout of $6.4 million
when he leaves the company
Annual pension of $5.1 million
What do you think?
Have more physicians turned to crime?
Or more payers have discovered
more effective ways to underpay, delay, and
take back the money they already paid?
WHY
and

HOW
Fraud hysteria – audits –
refunds and penalties
Consolidation
Oligopsony –
Fee control
– by driving providers
into a network
Profile providers
within network
for compliance
with efficiency
standards
Add
temporary
constraints
Exploit
Payer
idiosyncrasies
Increase
claim complexity
Superior
processes
Discipline
Technology
Labor cost
arbitrage
India
Philippines
Romania
Payers Gain Tactical Advantage in Three Ways
Increase
Claim
complexity
Add
temporary
constraints
Introduce
and exploit
Payer
idiosyncrasies
Use
disparate
data formats
Use
arcane terminology
Modify
CCI and LMRP
rules
Modify
CPT
codes
Report
one error
at a time
Patient,
e.g., global periods
Payer,
e.g., timing
proximity to
fiscal
year start
Procedure
constraint, e.g.,
experimental
services
Bundled
services
Disputed
medical
necessity
Strategic
Payers Gain
Strategic
Advantage
in
Four Ways
Profile providers
within network for
compliance with
efficiency standards
Oligopsony–
Fee control –
by driving
providers into
a network
Consolidation
Fraud
hysteria
Tier networks –
incentivize patients to
see lower cost
“higher quality”
providers
“Pay the
enrolee program”-
Discontinue direct
payment to out of
network providers
“All or None”
participation take lower
paying plan
(HMO, POS, capitation)
if you wish a better plan
(PPO, indemnity)
Don’t renew Oxford
if you refuse
United Healthcare
73% of insured
population are covered
by 3 plans alone
Top 10 plans
cover 106 million
lives
United Health Group,
WellPoint, and
Aetna -77.7 million
Strategic
Processes
Tactical
Labor Cost Arbitrage
Payer System
Billing Network
Single Cloud-
Based System
Strategic
Processes
Tactical
Labor Cost Arbitrage
Single Cloud-
Based System
Aggregate
Based System
Strategic
Processes
Tactical
Labor Cost Arbitrage
Single Cloud-
Based System
Aggregate
Based System
Shared Billing
Knowledge Base
Strategic
Processes
Tactical
Labor Cost Arbitrage
Single Cloud-
Based System
Aggregate
Based System
Shared Billing
Knowledge Base
Single Integrated
System
Strategic
Stand Alone Systems
Processes
Tactical
Labor Cost Arbitrage
Payer System
Provider
Strategic
Stand Alone Systems
Processes
Tactical
Labor Cost Arbitrage
Payer System
Provider
What if providers could analyze 1,000,000 claims?
What drives such an outrageous abuse?
William McGuire, CEO
United Health Group
Tactical –
Opportunistic
GREED
"
United Health Group
"
earnings rose
38%
in the
3rd
quarter
of
2006
alone.
Provider
Refund to
Payer
Payer System
Billing Network
Payer System
Billing Network
Payer System
Billing Network
Do you see how do payers
rig the game and stack the cards?
Strategic
Processes
Tactical
Labor Cost Arbitrage
Single Cloud-
Based System
Aggregate
Based System
Shared Billing
Knowledge Base
Payer System
Provider
Tilted Playing Field
What can individual practice owners learn from PacifiCare audit?
Full transcript