MedCity Influencers, Health IT

It’s time to start innovating to make administrative data interoperable

Just as with clinical interoperability, greater administrative interoperability could help eliminate many of the costs related to billing and insurance, freeing up much-needed investment resources.

interoperability, rope, braid

The healthcare industry has come a long way in its ability to share clinical information, especially across geographic regions and with point-to-point connections. A report by CHIME and KLAS Research shows that nearly two-thirds of provider organizations that have invested in interoperability are satisfied with their progress and report that they “often or nearly always” have access to the records they need. The report also said the most valuable methods for accessing patient data are public HIEs (39%), national networks (36%), and direct messaging (31%); those who use large EHR vendors have shown the highest FHIR adoption rates; and, the top use cases for FHIR APIs are patient-facing tools (31%), clinician-enabling tools (27%) and patient-record exchange (24%).

As the industry continues to gain momentum in clinical interoperability, it’s time to expand our view to include the value of another type of interoperability: The fluid and direct exchange of administrative data.

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Rising costs of administrative processes and data

Examples of administrative complexity are many and varied, including having to fill out forms in duplicate, re-keying existing data into multiple systems, and managing data via fax transmissions or worse — human phone calls. Most often, administrative complexity is part of billing and insurance-related (BIR) processes. These processes attempt to answer questions like:

  • Is this patient eligible for this service?
  • Can we verify the exact benefits?
  • Does this service need prior authorization?
  • Is this provider credentialled?
  • Is this provider part of the right network?

We spend approximately $42 billion each year conducting administrative transactions according to the 2021 CAQH Index report. Each manual eligibility and benefit verification transaction costs the industry $16.07 while each manual prior authorization transaction costs $14.49. These costs include the labor necessary to conduct the transaction, but not the cost of gathering information for the transaction or for follow-up.

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Considering that payers and providers conduct 831 million manual eligibility and benefit transactions and 62 million manual prior authorizations each year, the total costs of these two transaction types alone is staggering.

What if there were a way to have all this information readily available to every stakeholder via a secure and neutral network? The time, effort, and resources currently needed to manage these transactions could be significantly reduced.

The good news is that technologies such as blockchain can help make this type of interoperability possible, securely, timely, and much easier than you might think.

Achieving administrative interoperability without data aggregation

A healthcare network that’s enabled by blockchain could allow the storage and transfer of data over a peer-to-peer network without having to centralize data into a single storage system or even involve an intermediary party at all. This means that the data housed in a hospital or payer’s systems can remain there, so that each entity can maintain control over its information systems. They would securely expose data and allow it to be discoverable by users based on permissions it sets.

Once information such as eligibility and benefits is requested, an ID keychain and master index would locate the information, match it to the data available and then deliver it to the requestor. A single neutral network operator could provide certification, cybersecurity, and compliance.

A network such as this could also reduce IT costs by enabling rich solution vendors like revenue cycle management companies, telehealth platforms and others involved in the business of healthcare to connect through the same network as well. This would eliminate the need for payers and providers to build and maintain gateways with multiple systems. Even beyond cost savings, having fewer system touchpoints should dramataically reduce the potential for security breaches.

A better way

Payers and providers spend nearly $496 billion each year on billing and insurance-related costs.  Just as with clinical interoperability, greater administrative interoperability could help eliminate many of these costs, freeing up much-needed investment resources. Leveraging a secure network, enabled by blockchain should be a part of every health system’s strategic plan for improving efficiencies and reducing costs for a better healthcare continuum.

Photo: JamesBrey, Getty Images

Stuart Hanson is passionate about creating a better consumer healthcare experience and has joined Avaneer Health as CEO to build an inclusive network that ensures all stakeholders have equal access to comprehensive data when it’s needed most. Stuart previously served in leadership roles for healthcare solutions at JPMorgan Chase, Change Healthcare, Citi, and Fifth Third Bank. He has served as chair of the HIMSS Revenue Cycle Improvement Task Force. Stuart has a bachelor’s degree from University of Illinois and an MBA from University of Chicago Booth School of Business. Stuart is a dynamic, innovative leader committed to improving the healthcare ecosystem.

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