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Internet-Enhanced Physician Practices

Today, a typical medical claim takes about 20 steps to adjudicate, from the time that it is printed out by a practice mangement system until it has been paid. A preferred provider organization (PPO) claim may, in fact, have gone from paper to digital format three or more times during this process. For example, a claim sent to a large payor will probably have been entered into the organization’s computer system before it is determined to be a PPO claim. The payor then prints the claim on paper and mails it to the proper company to have it repriced. That company enters it in their computer, but has no connectivity with the payor, so it prints the claim again with the repricing information and mails it to the payor. It is then entered in the claims system of the payor a second time. If any errors are made, the process becomes still more complex.

Of non-Medicare claims in the United States, only 2% are electronic. A fourth of all claims are duplicate claims, however, largely because it is impossible to tell where a claim is at a given time. This inefficiency is expensive; Kaiser Permanente, for example, spends $40 million per year answering the question, “Where is my claim?” The typical claim costs approximately $12.50 to adjudicate. The average amount of a claim, if pharmacy and laboratory claims are included, is $62.50. When it costs 20% of a claim’s value to process it, something is wrong.

THE NEED FOR CHANGE

The situation is dismal, and payors should be responding to it. The package-shipping industry has found it expedient to track the location of packages for many years; why shouldn’t this concept be applied to medical claims? Transparency and efficiency in the financial environment have become the norm. Why can’t we have them in health care?

Providers also need to make changes. The physician-patient encounter often results in no patient education whatsoever. Handwritten prescriptions and case notes can be illegible, resulting in errors. Appointments may be scheduled by hand, by only one individual in a practice, and their availability may be severely limited. This is no way to do business. Internet users book their own airline tickets; why can’t they also suggest or request their own appointment times?