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Myndshft Blog

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February 21, 2020

Insights from the Diagnostic Coverage & Reimbursement Conference

by Chaz Bagwell | Healthcare Administration

Last week, we participated in the Diagnostic Coverage and Reimbursement Conference in San Diego. It was an intimate gathering that brought together executives from diagnostics and genomics laboratories, and payers to openly discuss reimbursement, market access, and revenue cycle challenges and what can be done to address them.

The two topics that permeated most discussions were prior authorization and price transparency.

Prior Authorization

There was consensus among all attendees that the increase in prior authorization requests has been problematic and that providers and payers need to work collaboratively to improve adoption, reduce physician abrasion and — most importantly — provide patients the care that they need in the most timely and convenient way possible.

Perhaps not surprisingly, the proposed solutions to address prior authorization varied quite a bit.

Some of the participating laboratories proposed using technology such as AI chatbots to ensure that patients met medical necessity through text engagement which would eliminate the need for prior authorization altogether. On the other side of the spectrum, there were advocates promoting a more fully automated approach to prior authorization; Myndshft falls more in line with this thinking.

Regardless of the actual strategy, everybody in attendance — including payers — indicated that they are actively seeking options to alleviate the unintended consequences that prior auth has wrought. Congressional committees and government agencies like the U.S. Department of Health and Human Services (HHS) are also investigating legislative solutions.

The importance of simplifying, standardizing and automating prior authorization is underscored by the recently published CAQH Index, an annual report that measures progress in reducing the costs and burden associated with healthcare administrative transactions. The report noted that moving from a manual to a fully electronic prior authorization process stands to save $12.31 per transaction, the greatest per transaction savings of all the administrative functions studied.

One of the conference speakers noted that prior authorization requirements are increasing by roughly 10% year over year but that electronic prior authorization (ePA) adoption is incongruously decreasing by the same margin. This may have something to do with the physician abrasion that occurs when too many preauthorization requirements are imposed on providers.

Price Transparency/Surprise Billing

Most in attendance indicated that they expect further federal legislation around surprise medical billing to go into effect sometime this year.

Surprise billing is a hot button issue within healthcare — especially during the current election cycle — as the lack of coordination and transparency between in-network and out-of-network providers comes under heightened scrutiny. Similarly opaque and complex pricing for prescription drugs is under similar scrutiny.

Two proposals to address surprise billing moved out of committee in the U.S. House of Representatives last week so federal legislation on this issue is moving forward.

Similar legislation has already passed at the state level and early indications point to some positive results. After a ban on surprise billing took effect in California three years ago, the percentage of services delivered out-of-network decreased by 17% (source: USC-Brookings Schaeffer Initiative for Health Policy.)

California’s surprise billing law restricts payments for out-of-network physicians to a formula based on what other physicians are being paid and serves as a template from which federal legislation will likely borrow liberally.

Lobbyists and other political interest groups representing both provider groups and payers are jockeying to shape any legislation that wends its way through Congress, with providers advocating for an arbitration approach, and health plans and employers pushing for regulations that set benchmark rates for in-network services. Regardless of whether any federal legislation is passed on this issue, there is sure to be continued debate on who foots the bill and how disagreements get resolved.

Myndshfit is doing our part to usher in more transparency to the healthcare process too. Our real-time benefits check solutions enable alternative sites of care to determine health insurance eligibility, verify benefits, calculate a patient’s financial responsibility, and determine whether prior authorization is required — in real-time at the point of service. No surprises after the fact.