Why Payers Need to Modernize the Claims Payment Experience

Insurers are much closer to their vision of claims processing in 2030 than just a couple of years ago, according to McKinsey & Company. For commercial health payers, this means an integrated, digital claims payment process that benefits every stakeholder.

“Healthcare claim payments are ripe for innovation,” explains John Gilmartin, Chief Operating Officer at Jopari Solutions Inc. “There are not only new payment methods, but the technology has also evolved so that payers can rethink how they review and pay claims.”

Commercial payers are relying more on digital solutions to reimburse providers. The adoption of claims payment using fully electronic methods reached 71 percent in 2020, the most recent year for which the Council for Affordable Quality Healthcare, Inc (CAQH) had complete data. That percentage is likely to rise considering how the COVID-19 pandemic prompted payers to innovate and invest in next-generation capabilities, such as electronic claims payment and digital claims management processes.

Despite the progress with electronic adoption and the promise of further innovation, commercial payers still leave millions of dollars on the table because of manual or outdated electronic processes.

Challenges of digitization

While payers are on the path to a digital claims payment experience, friction between payers and their provider partners has often hindered both parties from realizing the full benefits of a genuinely integrated digital experience.

“The tension stems from the idea that providers want to be paid for the services that they performed at the rate they submitted, and payers want to pay what they owe,” Gilmartin explains.

This natural friction between payers and providers has given rise to claims payment programs that often only benefit one party. Government and commercial payers, for example, have traditionally relied on programs that seek enterprise solutions to manage for the exceptions, when instead they should implement solutions that benefit all parties, while ensuring the exceptions are addressed. 

“There is a significant amount of fraud, waste, and abuse in healthcare,” Gilmartin admits. The Office of the Inspector General recently found that the federal government recovered over $5 billion in healthcare fraud settlements during the 2021 fiscal year.

“However, the programs end up being constricting and inefficient,” says Gilmartin. “Yes, there need to be controls to stop fraud, waste, and abuse, but the industry needs to consider how programs can foster more timely, accurate payments because that is what providers want, which benefits payers as well.”

Providers also want those payments to be made in a form that is most convenient to their business, Gilmartin adds.

“There’s still twenty to thirty percent of the market that is sending paper check payments,” he explains. “But more and more, providers are moving in the direction of paperless payment methods and beginning to seek out real-time payment options.”

Other industries have modernized payment processes to eliminate the exchange of physical cash and paper, and many consumers have become comfortable with that form of payment. Those payment processes, like Venmo, Zelle, and PayPal, have also started to gain hold in healthcare with consumer payments. There is also potential for these digital payment options to impact B2B payment if the healthcare industry can modernize and ease the friction between its two most prominent players.

“It’s time to find solutions that will benefit all parties and support the ecosystem,” Gilmartin states.

A solution for payers and providers

Many payers have developed digital methods of paying their provider partners, with most payers using their own portals. However, these portals lack the choice and integration that providers truly want and payers genuinely need.

A claims payment solution that benefits providers and payers should give providers a choice on how they would like to get paid. Providers should be able to select which modality they would like to receive payment by, whether it is Virtual Card, ACH/EFT, Push to Card, or eCheck, and if they still want to receive paper checks, the solution needs to have that capability integrated as well. 

“The message we’ve heard from providers is that they want more choices even sometimes by payer,” Gilmartin says.

There are many ways to reimburse providers electronically, and newer digital methods are emerging as other industries tap into contactless payment. Some providers are also starting to turn away from traditional electronic payment methods like ACH due to data security reasons.  An integrated claims payment solution can give payers the flexibility and security providers seek.

Providers also want to view all their claims payment information in one place. As CAQH explains, payer portals create inefficiencies because each portal has its own login information and pathways for finding payment information. Providers must also leave their billing or practice management software to access that information.

APIs and Microservices create a modular, service-oriented architecture that enable access to data from disparate systems in a scalable, secure, and compliant method.

“Creating cross-system integrations via Microservices that allow for data to be exchanged in near real time with APIs can help solve for the inefficiencies and allow for a streamlined experience and improved collaboration between payers and providers. Additionally, cross-portal integrations with Single Sign On would improve ease of use and increase end-users satisfaction and reduce support calls,” Gilmartin explains.

Payers and providers have already leveraged this technology in other aspects of healthcare administration. Now, it is a matter of further streamlining the processes to increase payment efficiency for both parties. The technology can also take it further by giving providers access to additional claims information within a single platform. For example, solutions can tap into web services to give providers access to proof of mailing confirmation data or payment status. This frees up payer resources by reducing the number of inquiries from providers on top of reducing other administrative burdens and costs.

Modernizing the claims payment process can eliminate the friction between payers and providers. The right solution can solve inefficiencies, ensure accurate reimbursement, and improve financials for both parties.

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About Jopari

Jopari Solutions, Inc. is a healthcare information technology company supplying innovative Medical Claim Payment, Attachment Management, and eBill Solutions for the Commercial, Government, Workers’ Compensation and Auto Medical markets. Jopari has established an extensive connectivity network linking Payers, Providers, Practice Management Systems and Clearinghouses.