We’re at a pivotal moment in healthcare.
Advancements in data, analytics and technology are creating unprecedented opportunities to improve the quality and efficiency of care, while empowering consumers to take an increasingly active role in managing their health. Trends toward personalized medicine and value-based care are addressing longstanding inefficiencies associated with fragmented, fee-for-service healthcare. More than ever, the industry is recognizing that patient health is contingent upon a multitude of factors — and that addressing all of them is the key to improving health outcomes.
Across each of these trends, coordination is the common thread to success — from the collaboration of stakeholders to the interoperability of systems. Coordination of benefits (COB) is a prime example of how a function that has historically been perceived as the sole responsibility of one party — in this case, the payer — has become the collective responsibility of multiple parties. Here, we’re discussing the importance of payer and provider participation to ensure the proper coordination of benefits in today’s increasingly complex healthcare environment.
More Than a Cost Containment Function
Before diving into some of the specific implications of COB for payers and providers, it’s important to first explore COB’s vital role in the care continuum.
When an individual has more than one source of health coverage, government payers and commercial health plans have long used COB to determine which payer is primarily responsible for paying a claim. And while COB’s role in containing healthcare costs for payers is well documented, there has been less discussion on the critical role of COB in a clinical capacity.
Integral to care coordination is a whole-person approach, which begins with having a big-picture view of a patient’s health, including all available health benefits. However, placing this responsibility largely in the hands of patients can result in reporting errors and omissions that may limit access to benefits and services to which they are entitled. In the effort to drive down healthcare costs and improve outcomes, eliminating inefficiencies and redundancies in the COB process must be a priority for both payers and providers — and the earlier in the care cycle, the better.
The Far-Reaching Impact of COB
Operating under the notion that COB is primarily a payer function does a disservice to various healthcare stakeholders. For providers in particular, the costs of COB errors are myriad and can include:
- Administrative burden. Dedicating excess time and resources to claim resubmissions and general rework can increase labor costs and fuel administrative burnout.
- Lost revenue opportunity. Because commercial reimbursement rates are generally higher than for Medicaid or Medicare, neglecting to identify third-party liability prior to care or billing could negatively impact the provider’s bottom line.
- Barriers to care. Improper coordination of benefits may prevent providers from obtaining appropriate prior authorizations, leading to claim denials and delays in care.
For payers, improper claim submissions at the provider level can result in burdensome pay and chase activities to recover erroneous payments. And for states and taxpayers, COB errors can contribute to the billions of dollars spent each year paying improper Medicaid claims.
In a Coordinated Care Environment, COB is Everyone’s Responsibility
Revenue management functions like COB are one of the greatest and most critical opportunities to overhaul ineffective systems and drive the shift toward a more efficient, secure and patient-centric care environment.
Obtaining comprehensive coverage data prior to authorization, billing or care helps to ensure everyone has the information they need to accurately authorize, schedule and bill for healthcare services. For health plans, gathering this information during the enrollment process and maintaining it throughout the coverage lifecycle virtually eliminates the need for providers to collect this information during the patient onboarding process — but that doesn’t mean providers are off the hook. Continuously verifying patient coverage information will help facilitate right-first-time billing, expediting the reimbursement process and reducing the need for rework at the payer and provider level.
How are you assuming and sharing responsibility for COB?