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It’s a scenario that can wreak havoc on a hospital’s bottom line: A patient comes to the emergency department (ED) and, in the urgency of the moment, has forgotten his insurance card. Or an accompanying family member says, "I think my mom’s on Aetna, but I’m not sure." ED registrars create an account listing the patient as "self-pay" and may — as is the case with The Ohio State University (OSU) Medical Center in Columbus — notify the patient of that in a letter a few days later that also asks the person to contact the hospital if he or she has insurance.
In many cases, says Sue Alden, RN, MS, director of registration training and quality assurance, the hospital may not paid for the service. At best, payment is delayed, often for months or more.
As OSU Medical Center looked at ways to optimize its use of the SMS registration system, which was installed in January 1999, Alden notes, a key question was, "How can we enhance our ability to bring money in?" With self-pay accounts responsible for a big part of the institution’s missing revenue, she says, one of the answers to that question was to implement the electronic insurance verification system from HDX. (For another kind of solution to insurance verification, see "Better system sparks need for customer PR," in this issue.)
Although the hospital also had looked at stand-alone systems, notes Joseph Denney, CHAM, lead, patient management system implementation, HDX ultimately made sense because of its partnership with Malvern, PA-based SMS. "When you buy the products together, you get a good deal financially. We made a conscious decision [to go with HDX] because of everything else that came along with it."
With HDX in place, the above ED scenario changes dramatically, Denney says. If the insurance company involved is on the system, it will be queried — through entry of the patient’s name, Social Security number, and date of birth — and will provide the registrar with a policy number, group number and whether the coverage is effective for that patient account, he adds. "It’s a win-win situation."
In addition to those who simply forget their card, Alden says, "we’re frequently finding insurance on people who said they were self-pay."
Another advantage to the system, Denney points out, is that a patient who says he has Medicaid may have forgotten that he subscribed to an HMO. "HDX will go in and search the system, and if the patient is in an HMO, that information will come back."
It’s too early in OSU Medical Center’s implementation of HDX to know exactly the percentage of patients the system will cover, Alden says, "but even if we can check 40%-60% of the cases, we’re better off. It’s well worthwhile — anything you can do to improve self-pays is worthwhile."
In general, the HDX coverage rate for central Ohio is about 55%, Denney adds, and the company has promised to work with the hospital on special requests. For example, "one of those I would shoot for is our own health plan," he says. "We take care of our own employees, and that’s 25,000 people."
Under the present arrangement, HDX covers about 20 insurers with which OSU Medical Center does business, including Medicare, Medicaid, Medical Mutual of Ohio, and United Healthcare, among others. "Ultimately, we would like to see a company that covers all [insurances]," Denney notes, "and with some of the Internet-based products, that is closer than we might have thought." The competition provided by the companies that provide the service through the Internet, he suggests, will spur other vendors to increase the number of insurers they cover.
With HDX in place, the insurance verification happens as the registration is being done, which saves the time that financial counselors and precert personnel have spent going into another system to check on insurance status, Alden says. In addition, input errors are eliminated. Besides these more obvious benefits, she notes, the system offers these advantages:
• Information is more specific. "We’re finding that by being able to check eligibility on Medicare, we’re getting, for example, exactly how a name is spelled," she points out. "We might have had a rejection before because the name didn’t identically match what Medicare had."
• Plan code confusion is decreased. Because of confusing insurance cards and patients who are unclear about the coverage they have, registrars sometimes put in one type of Aetna plan when it should be another Aetna product, Alden says. In one case, she points out, the faint watermark of a "C" is the only difference between the cards for two different insurance cards. Use of the HDX system eliminates that issue for the insurance companies it handles.
• You can correct problems before the bill drops. There are real benefits from a quality assurance perspective, she notes. "When you see an account that is missing a number, or doesn’t look like the registrar pulled off the right number, you are able to correct that. It allows you to do a lot more upfront fixing."
• Extra information is sometimes provided. Staff increasingly have found that when HDX makes a Medicare check, the system not only brings back the information on that account. It may say that, according to Medicare records, the patient also may have another third-party insurance, Alden explains. This is important because it alerts the hospital that it should ask the question of whether Medicare, or another company, is the patient’s primary insurer, she adds.
Although the HDX system has many pluses, there are some drawbacks that potential buyers should keep in mind, Alden notes.
• Sometimes HDX has access to an insurance company, but not to all of the company’s products. "You may not be querying all the company’s products (when the system goes out to search for a patient’s account), but it doesn’t tell you this," she says. "You think you’ve checked all the products, but the HDX contract may be limited to a couple." That means that if HDX handles Cigna’s PPO plan, but not its HMO plan, a query on a patient with the latter will come back with the response that the patient isn’t covered, Alden notes. "We don’t see a lot of this [problem], but it is a limitation."
• Some interpretation is required. "We have to find out some things for ourselves," Alden points out. "The response comes back from Medicare and we have to do some interpretation. The biggest concern is the staff’s ability to [do this]. It takes more of a thought process." For example, based on the answer that comes back from Medicaid, for example, staff have to determine whether the person has Medicaid or Medicaid disability coverage, she notes. "For us, those are two different plan codes."
With the accounts of inpatients or those having ambulatory surgery, there is a pre-cert area where staff provide "a second-tier verification" to ensure that registrars have identified the right insurance plan.
• The regions covered are more limited. The hospital’s previous system for checking Medicare coverage extended the search to all regions of the country, she notes. "With HDX, we had to choose whether we wanted the system pointed to one regions vs. another." That means if patients from Kentucky are included, those from Pennsylvania are not, Alden adds. "If the region you need is not included, it’s a longer process. We have to do the follow-up by phone."
Alden advises access managers helping make the decision on whether to buy an electronic verification system or which one to buy, to choose an option that puts the process into the registration pathway. This way, she says, eligibility is being checked as the registration proceeds.
Denney adds, however, that there are hospitals who batch their accounts at the end of the business day. In such cases, he says, a stand-alone system is the only choice.
Crucial to selecting the right system, Alden points out, is questioning the vendor on how quickly negotiations are conducted with insurance companies it seeks to add to its coverage. "How fast have they added on [in the past] and are they continuing to grow the business?"