CEO Chet Burrell Explains RealMed''s Role As a Bridge Between Payers and Providers

PDF File: 

HCT2_wp_burrell.pdf

RealMed Corporation

There is really no investment required by a practice to get on the service, soROIs tend to be high as measured by administrative cost savings and fastertime to payment.

Chet Burrell President and CEO RealMed Corporation

HCT: What do you see as the current state of payer-provider collaboration in the United States today?

Chet Burrell: Changing and rocky. The impacts of HIPAA are still being felt, and it has caused a lot of confusion that I think will straighten out as everybody settles down with what the new requirements are. Underlying that, we see a revolution going on with the coming together of HIPAA and the Internet. What HIPAA does is standardize transaction sets and the meaning of data, which will be very helpful in the long term even if it causes short-term disruptions. The Internet enables much more rapid, two-way communication between providers and payers on each of the various transactions, whether it be an eligibility request, a status request, or a claim itself. If there’s some error that would delay payment, a provider will know it much more quickly than they would through a traditional clearinghouse.

HCT: What is the role RealMed plays in fostering collaboration between payer and provider? How will that work?

CB: We sit right in the middle between providers and payers. Up to this point in time there hasn’t been as much communication as one might expect between providers and payers. For example, one of the things that providers complain about is the lack of an ability to get clear coverage information on the patients they serve. We are actively working as a bridge between payers and providers to provide clear explanations of detailed benefit information in real time over the web, prior to an appointment, so that the provider actually knows what the patient’s coverage is before they appear. That wasn’t possible before the Internet. Instead what happened was that providers called, and they spend a lot of time on the phone with the payers. Then, the payers complain about the cost of doing this on their end. Now this information is becoming available over the Internet and RealMed is “brokering” the transaction between payers and providers.

HCT: Automated eligibility?

CB: This is the ability to submit a batch set of inquiries automatically to a payer, and get a complete response back in a consistent way, so you can meaningfully incorporate the response in your practice management system, all without a phone call or the need to use administrative resources. It all can happen automatically behind the scenes. Automated batch eligibility looms large as an important service that most providers really want and need.

HCT: How about claims editing?

CB: There are literally thousands of edits that claims are subject to, and these are rising with HIPAA, so that now providers have a whole new class of edit concerns and error messages to deal with. What is mind-boggling is that the messages come back as cryptic codes from payers and clearinghouses. They are very hard for a provider to understand. So, what we’re finding is that it is critical to be able to return to a provider a clear understanding of what each error message means, what action step is required to correct it, and what field or fields on the claim are involved.

HCT: How about claim submission and management?

CB: Claim submission should occur only after you have done the necessary claims editing cleansing. RealMed offers the ability to do this in minutes and to see errors instantly. Two-thirds of the errors we see on claims are not related to content and format – they are related to patient eligibility. Correcting eligibility before submittal is fundamental, and putting the correct information on the claim in an automated way – actually populating the claim header with that information – is absolutely critical for getting high adjudication rates. Once you’ve done that, you’ve cleaned up all other errors, and can begin claim submission.

We basically submit claims three different ways. First, we can submit online, interactive, and in real time, so that when the claim is clean, you can find out in seconds or minutes what the adjudication result is, depending on how fast the payer system is. The second way is a direct online connection that is over the Internet but may involve an overnight adjudication, not an immediate adjudication, but is still very quick. And the third way is transmission over traditional electronic data interchange (EDI) channels, which more or less drops the claim off at an EDI gateway to a payer. This last way is giving ground to the first two methods as more payers move to online capabilities. The practice doesn’t need to know which way the claim got there; all they want to know is it got there, it got there cleanly, and it was fixed before it got rejected by either a clearinghouse or a payer. Closely related to submission is status. We found that one key to getting submissions straight was to provide immediate, automatically refreshed status online on all submissions. We display all related information regarding amount paid, check number, etc.

HCT: What about remittance advice?

CB: As electronic remittances move to an 835 HIPAA standard, most providers are slowly getting ready to accept this. Providers are skeptical about whether they wish to permit this new 835 into their practice management system and auto-post a return because they’re not always sure they know what the payer did to the claim. The payers themselves are just feeling their way through this. Also, an 835 typically contains many claims, not just one. And so, when you get an 835, you could be looking at 100 claims with prior adjustments from previous claims. RealMed is taking an 835 from payers and making it available on an electronic basis and also making it readable. Part of making it easy for providers to use is not only the clarity with which that data is laid out but also the way you can sort data for review and posting. For example, providers may want to look at high dollar value claims first or all claims just for Dr. Smith or all zero pay claims. It is this ability to target certain claims that is key because it gives the ability to manage your returns and arrange the information for easy, accurate posting.

Then there are two other aspects to consider. One is denial messages or claim resolution messages. Providers need to understand what happened to each claim. One of the things that RealMed is doing is helping to translate what the payer of the claim actually did. The second thing is – and this is where we find providers are very interested – when a remit is received, you need to be able to compare what was submitted against what you received from the payer – line-item specific. This way you can see that line three on the claim was bundled into two, or line four was paid at 50 percent because it was incidental. And, you need a report to highlight these differences so you don’t have to hunt and peck for them. In short, the practice wants to compare what they submitted with what the payer allowed and then paid. This then implies the ability to compare the payment against the fee schedule the provider accepts from the payer. RealMed provides these capabilities.

HCT: What are the barriers to adoption? What technology changes are involved and how are they going to see ROI from the investment?

CB: The technology we use makes it as simple as it possibly can be for providers. Typically, if you sign on to the RealMed service, there’s nothing you have to do to change any of the systems that you are already operating on. Your practice management system remains the same. There’s no integration of any software of ours or theirs. All RealMed work is done over the Internet and outside the practice’s internal systems. There is really no investment required by a practice to get on the service, so ROIs tend to be high as measured by administrative cost savings and faster time to payment.

HCT: How about from the payer side?

CB: From the payer side it can be more difficult. To achieve a full real-time interconnect – which I still think is unique to RealMed – requires detailed systems integrations. The best results for practices are achieved this way, since it opens up realtime adjudication and other responses. But, a direct online connect that is not real time can still deliver claims to a payer and get a rapid response that is not as difficult to do from a systems standpoint. And the fact that the HIPAA standard transaction sets are coming makes this a great deal easier.

HCT: What are some of the benefits on the payer side for having this kind of installation?

CB: The first benefit that payers realize is higher adjudication rates through the receipt of cleaner claims. We’re now getting adjudication rates with our best payer connects in the 90 percent range because we’ve made payer rules information clearer to providers up front. This has a meaningful effect on their overall operating efficiency.

The second benefit payers see are reductions in call volumes from providers. We know that 80 percent of provider calls to payers relate to questions about patient benefits or status on claims. By returning clearer information on these matters instantly, there’s a lot that can be done to cut down on call volumes to payers.

The third benefit is paper reduction. It’s still true that more than 25 percent of all claim volume is paper. We’re seeing two types of situations that explain the bulk of paper claims. One is a secondary claim where the payer involved is secondary to some other primary payer. The other situation is continued use of paper from very small practices that have always submitted on paper. These are the least technically sophisticated providers and the most resistant to change. However, RealMed offers a solution called “Print Exchange.” We’re targeting this to practices of fewer than 10 doctors, and particularly fewer than five. We download a utility over the Internet, which basically sets up a new printer icon. Practices then work their claims in the way that they normally would, and click “print.” Instead of literally printing, the claim is sent to us electronically and we send it on to the payer in a HIPAA-compliant way. This is virtually instantaneous.

HCT: To what extent does HIPAA impact how RealMed is implemented?

CB: Well, as I pointed out, to the extent that HIPAA makes transactions more uniform, both in form and in content, it makes it easier to submit these transactions. Its benefits will only be realized over time – more than 90 percent of our clients still cannot submit HIPAA-compliant transactions. So, we wind up making their transactions HIPAA compliant for them.

HCT: Can you talk more about the barriers in payer-provider collaboration?

CB: Payers often tell us the providers submit poor quality claims to them and that’s why they have to do the things that they do to assure accuracy. Providers see this as excessive rigidity and bureaucracy. Providers, on the other hand, say payers make the process overly complex, and seek to slow down payments to maximize cashflow. We don’t think the payers want to slow payment down; mostly what payers have said to us is that they are quite prepared to pay quickly as long as they get a clean transaction. What’s happening is that as rapid two-way communication between providers and payers over the Internet takes hold, the relationship between payers and providers should improve.

HCT: What does the future hold for RealMed and what changes do you see coming down the road in the next couple of years?

CB: Well, our business has been doubling every 12 months and we will probably continue to see that happening. We’ve developed some refined strategies to reach different parts of the market. The way we approach a big academic group is not the way we approach a small community-based practice. We’ve refined these strategies and will continue to do so to ensure they best fit the needs of the various market segments. The second thing I would say is our business has widened in scope tremendously. Two years ago, we were essentially doing one claim at a time to one payer. Now we’re doing all claims to all payers, a mix of real-time and non-real-time aspects, but we’re also doing eligibility and status queries. We’re starting to return remittances, we’re doing patient statements and drop-to-paper claims automatically, and we’re supporting far more robust data analysis and reporting. We think we’re seeing just the beginning of the Internet age in health care and are in the midst of helping this revolution advance.