Blog: The Barriers to Truly Digital Payer-Provider Enrollment

 Sensitive to social responsibility and business efficiencies, many industries are chipping away at the forests growing in their file cabinets. Going “paperless” is a no-brainer for most companies at this point. In the banking world, for instance, more than 90% of deposits are made digitally.

Yet in healthcare, transactions between insurers and providers remains largely paper-based. To wit, 86% of providers still receive their reimbursements via paper checks sent through the mail.

Government mandates like the Health Insurance Portability and Accountability Act (HIPAA) of 1996 and the 2010 Affordable Care Act have helped force the transition of healthcare away from paperwork and faxes, pushing the industry toward secure electronic messaging. Electronic medical and health records have become standard practice, but even despite the influence of federal regulations, administrative transactions such as Electronic Funds Transfer (EFT), Electronic Remittance Advice (ERA), Electronic Data Interchange for Claims (EDI), Claims Status Inquiry (CSI), and Eligibility Verification (EV) are often still done manually, on paper. A multitude of solutions, including payer portals and third-party vendors, have been created to bridge the technology gap and address administrative waste, but in most cases current solutions only shuffle the waste rather than reduce it, creating further barriers to a fully digital enrollment process.

E-Form Good E-Nough

Even with federal mandates to upgrade to digital transactions, some organizations have found workarounds. PDFs and email submissions of manually-filled forms are considered “electronic” methods, yet they fail to eliminate the manual problem. As a result, many transactions remain split between paper and digital. Remittance advice is only done fully electronically 56% of the time, while payments are only made electronically 60% of the time.

Wet Signature Required

Even for forms that are filled out electronically, many payers still require a “wet signature” from the doctors themselves. This means the form must still be printed, then signed and either reuploaded or mailed. For providers that outsource administrative functions to practice management companies or clearinghouses, the “wet signature” requirement defeats the purpose of offloading those tasks.

A Catch-22

Providers that are in the vanguard of using digital transactions should be lauded as early adopters. Instead, some end up getting penalized. In fact, 17% of providers incur fees from payers for accepting electronic payments, or for the payers’ own use of third-party vendors. Although it may be reasonable for payers to pass on the costs of digital transactions, the fees – usually amounting to 2-5% of reimbursement – create another obstacle preventing providers from working with electronic payments, particularly as they face already shrinking reimbursement percentages. Those providers, who are already facing so many rules and regulations, should be given options that make going digital easier, not less attractive.

Dispersed Data

The biggest challenge to electronic payer-provider transactions is getting the more than 4,000 payers to agree on a single platform for managing provider data. So far, voluntary payer adoption of existing third-party enrollment solutions has been very low, and portal solutions created by payers themselves do not solve the issue of disparate and scattered bits of information. Providers, who work with an average of 25 payers, have to adhere to each payer’s prescribed solutions, creating redundancy and waste.

There are several significant obstacles to the total elimination of paperwork and manual processes on the financial side of healthcare, but they are not insurmountable. In order for the industry to move closer to reducing manual and inefficient administrative processes, a neutral party is needed to create a solution that helps providers streamline their payment process while also providing an incentivizing benefit to payers – a one-stop, fully-digital solution capable of widespread adoption.

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