Mastering Insurance Eligibility & Pre-Authorizations

Mastering Insurance Eligibility & Pre-Authorizations Mark Droste Regional Sales Manager

Impact to Laboratory Revenue Cycle Pre-authorizations and insurance eligibility checking directly impacts the Laboratory Revenue Cycle! *It is one of the most difficult and time consuming areas to manage* So what is a Revenue Cycle? "All administrative and clinical functions that contribute to the capture, management, and collection of patient service revenue." Source: Healthcare Financial Management Association (HFMA) The start of the Revenue Cycle begins with insurance eligibility verifications and pre-authorizations which dramatically impacts Laboratory Outreach revenue: coverage, errors, rejections, denials, and bad debt write-offs.

Laboratory Outreach Revenue Laboratory Outreach Revenue has multiple definitions “…a non-patient is an individual who is neither an inpatient nor an outpatient but whose specimen is provided to the hospital for testing and who is not physically at the hospital” source: CMS Now the conflict UBI (Unrelated Business Income) if the ordered tests originate from physicians that are not owned by the hospital, the hospital is required to pay taxes so this also could be considered Laboratory Outreach revenue. Source: IRS

Hospital Owned vs. Independent/Affiliated Physician Practices For today’s presentation Laboratory Outreach Revenue is simply test volume originating from a combination of Hospital owned physician practices or Independent/Affiliated physician practices that is not connected to a inpatient stay or outpatient service. Hospital owned physician practices • The registration tends to be in better shape • Patient is ran through the hospital’s HIS or enterprise physician practice management system Independent/Affiliated physician practices • This registration process is a challenge to control similar to a dumpster fire that is out of control because the workflow originates outside the laboratory Outreach Physicians 36.6% vs. Hospital Owned 63.4% source CHI Solutions

Multiple Patient Registration Workflows The registration from Independent/Affiliated comes from multiple sources: Face-to-Face Patient Registration Lab Outreach • Patient Service Center - patient with paper requisition • Patient Services Center - patient with electronic order • Hospital Campus or Lab Department - patient registered Non-Patient Registration Lab Outreach • Paper Requisition - with Specimen • Electronic Order - EMR Order with Specimen • Electronic Order - Lab Order/Result Portal with Specimen The punch line: often the information is expired, incorrect, or incomplete

Statistics Registration Denial Breakdown: Source: multiple industry averages Registration vs. Non Registration Denials Source: multiple industry averages

Insurance Eligibility Verification Workflows How Does Insurance Eligibility Verifications Work? Eligibility verification is the process of checking a patient’s active coverage with the insurance company before the patient is seen or in our case laboratory services performed. Three methods available: • Electronic 270/271 transactions • Payer Website • Phone

Insurance Eligibility CheckingElectronic Real Time Request Definition of Electronic 270/271 Real-Time Request/Response Eligibility and Benefit Inquiry (270) • The transaction (from the billing entity) to inquire (payer) about the health care eligibility and benefits associated with a subscriber or dependent Eligibility and Benefit Response (271) • The transaction used (from the payer) to respond to a request inquiry (from the billing entity) about the health care eligibility and benefits associated with a subscriber or dependent

Insurance Eligibility Checking Electronic Real Time Request Touch point opportunities for eligibility checking • Physician office - integration with physician scheduler • Physician office - at point of registration • Physician office - at point of check in • Hospital - at point of registration/check in • Draw station - at point of registration/check in • Lab - at point of registration/check in • Call Center - preregistration

Insurance Eligibility Batch Checking In the Absence of a face-to-face registration – Batch Checking • End of Day - LIS • End of Day - HIS • End of Day - Laboratory Billing System • Upon Export/Import from billing system to Claim Scrubbing System What is batch checking? A file with all the patient and insurance demographics sent to individual payers - usually automated

Insurance Eligibility CheckingPayer Website and Phone Next steps if the payer does not participate in the 270/271 program Check payer website for eligibility • 5-10 minutes per check = 6 to 12 per hour Call payer for eligibility • 10-15 minutes per call = 4 to 6 per hour Call doctors office • 10 minutes per call = 6 per hour Call patient (recommend 3 attempts) • 5-10 minutes = 6 to 12 per hour Source: RCM clients • Estimates cost of manual eligibility verification • $3.70 per claim • Costs of automated or electronic verification • 0.74 per claim • Source: National healthcare Exchange Service

Insurance Eligibility CheckingPatient Statements • Patient Statement Cycle • Sending patient statements / letters • Return mail • Call Center • Pre-Collections • Collections (Bad Debt) Patient Statement Sent *use as a last resort

Eligibility Search Options Eligibility Search Options Most payers support two options for searching for a patient’s eligibility and benefit information. • The first search option uses a Policy Number/ Member ID as the primary data element of the search. • The second option uses the patient’s Name as the primary data element of the search and usually requires other data such as Date of Birth and Gender to uniquely identify the patient

Insurance Eligibility Information Nuggets You can obtain detailed benefit information including: • Policy Effective and Termination dates • Employer Information • In-Network and Out-Of-Network Deductible, Co-Insurance or Co-Pay • Out of Pocket Expenses • Maximum Benefits (Visits for Year / Total lifetime dollar value) • Patient Age or Service Limitations, Plan Exclusions • Coordination of Benefits (Primary/Secondary/Tertiary etc.)

Insurance Eligibility Information not verified or incorrect Not verifying the eligibility and benefit information impacts: • Billing - unable to bill the payer (member not found) • Denials- could be denied by the payer (expired policy coverage) • Patient Responsibility – their share of the laboratory charges

Insurance Eligibility & Pre-Authorizations Let’s dive into the details of typical errors • First name incorrect • Spelling Kelly vs. Kelli • Nickname Robert vs. Bob • Person Name Suffixes • Jr vs. Sr • Middle Initial • Wrong Date of Birth • Wrong Insurance • Last name incorrect • Married Name • Maiden Name • Spelling: Schaefer - Schafer Schaeffer • Incorrect SS Number • 8 looks like a 3 • 7 looks like a 2 • Incorrect or Missing Policy Number

Wrong Insurance Why? Wrong Insurance – Let’s Explore This One! Physician Office - End of Day Registration • Patient presents new insurance however not updated until end of day after lab visit is generated Patient Service Center • Staff claim they are to busy to check insurance HIS to Lab Interface may impact what is sent to an outside billing system • Audit what is sent from HIS to the LIS, make sure only active insurance is being sent Know how your Billing System Handles Insurance Refreshes from Upstream Systems • Historic insurance plans populate over the new insurance despite having the correct insurance captured EMR Interface Not Mapped Correctly • Physician insurance is not mapped to hospital insurance plans Person at Registration selects the wrong insurance • Example United Health Care multiple groups, Medicare Advantage Plans, HMO’s, Medicaid MCO’s Source: RCM clients scenarios

Insurance Eligibility Status Pass Status • Represents patient accounts that successfully passed insurance eligibility checking during batch processing Review Status • Represents patient accounts requiring additional information, user must review prior to initiating eligibility check • Example: get a hit but not a full reply need intervention • Payer is merging systems or payer system is down (try again) Incomplete Status • Represent patient accounts with missing information to initiate an eligibility check. • Example: policy number missing which is a payer requirement or represents patient accounts that contains insurance that is expired or not correct Failed Status • Example: Not on file or expired policy are two of the frequent reasons

Lessons Learned & Best Practice • Develop trending and tracking reporting: • By error code • By error code & ordering site (physician office) • By top payers • By draw site (registration) • Work with senior administration to implement programs & enforce accountability • Assign a dedicated team to work the errors – this is a must! • Use one data base as the source of truth • Update the eligibility checking history screen with results from checking payer website or on the phone with the payer or using other checking systems

Lessons Learned & Best Practice • Grab all paid claims for a year and match up the payer on record upload to your eligibility checker for history reference • Use screen scraping technology • Move verified data to your billing system without human error. This also counters the “I don’t have time excuse” • Integrate into your billing or LIS system - iFrame • Use your insurance claim results to measure how well the eligibility processes is working • Are you experiencing large number of rejections for invalid member id/date of birth/invalid name? • Hold focused staff sessions about what works and best practice

Lessons Learned & Best Practice • “Patient Not Found” Training • Train the registrars to double check the Member ID, to remove the ID and do a name search, check spelling of the last name and date of birth • Run self-pay accounts for Medicaid managed care programs • Collect deductibles up front in the draw stations • Batch check insurance history - if you have multiple insurances on file • Check document imaging system • If the account goes to collections and they secure the identify of the insurance update your eligibility checking system history • Map out all potential areas where insurance is captured/stored

Lessons Learned & Best Practice Demographic Scrub • Scrub for correct first and last name • Scrub for date of birth • Scrub for social security number • Scrub for mailing address – lowers your mail return rates Very important you start with clean demographics

Lessons Learned & Best Practice • Have an Electronic Insurance Eligibility Work Queue • Provides a systematic approach to workload • User access across multiple departments: draw station/lab/call center/billing office • Sorted by error • Sorted by payer • Sorted by patient name • Sorted by DOS • Can use history to help find insurance

Lessons Learned & Best Practice • Robust Insurance Mapping Engine • Map physician offices insurance to lab (hospital) insurance • Move responsibility to billing office – they are the experts with insurance

Lessons Learned & Best Practice • Demographic Bridge between the physician PMS/EMR lab to LIS/order portal • Queries the physician system and brings the information over to the lab portal • If you have a lab portal in the physician office this is a must Request (demographic bridge) LIS / Lab Order Portal

We Are Having So Much Fun With What We Have Unearthed Lets Switch to Pre-Authorizations And See What Awaits Us…

Pre Authorizations A recent survey conducted by the American Medical Association (AMA) reveals certain shocking findings: • 75% physicians described prior authorization burdens as high or extremely high • 60% physicians reported their practices wait for minimum of one business day to maximum three business days for prior authorization decisions on an average • 66% physicians raised concerns over man power inefficiency with staff who works exclusively on prior authorization requests • 90% physicians reported that the prior authorization process often or always delays access to medical care to the patients

Pre Authorizations What is prior authorization (PA)? According to the AMA the Prior authorization (PA) is any process by which physicians and other health care providers must obtain: • Advance approval from a health plan before a specific procedure, service, device, supply or medication is delivered • Other terms used by health plans for this process include: • Preauthorization • Precertification • Prior approval • Prior notification • Prospective review • Prior review

Pre Authorizations Understanding the Physician Perspective • Physicians have to change, because obtaining preauthorization manually over fax and phone has become unsustainable….going electronic is inevitable • States are now beginning to mandate that payers adopt EDI standards for benefit determinations • Payers themselves are already on the move as they continue to push out PA requirements. This trend will only continue until the majority of prior approvals are processed electronically similar to e-prescribing and electronic claims • Presently, 70 payers accept the ANSI 278 electronic service authorization form

Pre Authorizations Trends • As demand for manual and electronic PA increase choices need to be made based on the cost of doing business in the pre-auth environment in the physician setting: • Option 1: continue to develop an in-house ongoing process with dedicated staff that specialize in this process • Option 2: outsource this process to vendors who specialize in the handling of ePA • Option 3: deploy a software solution to handle the ePA demands that integrates seamlessly within the physician’s EHR/practice management system through API’s, or an HL7 interface.

Pre Authorizations Statistics Physicians have come a long way in upgrading their technology stack • 95% adopted electronic claim submission • 87% of physicians have adopted EHR • 70% adopted e-prescribing • 8%, adopted prior authorization ePA The work is still being done by manually via phone and fax Source: Council for Affordable Quality Healthcare

Pre Authorizations The Reason Adaption of Electronic Pre-Authorizations is slow • A significant technology gap exists due to the inability of software makers to reconcile the incomprehensible variables of over 2000 health plans that each have their own prior authorization request form • The standardized form for electronic precertification, the ANSI 278 Services Authorization, has been in place since 1996 by HIPAA regulations • Unlike electronic claims, e-prescribing and eligibility - States have not forced insurance payers to adhere to long established standards

Pre Authorizations What exactly is a prior authorization requirement? • A prior authorization requirement, also known as a pre-authorization or pre-certification, is a clause in the health insurance policy that says the patient must get permission from their health insurance company before they receive certain health care services which includes specialized laboratory testing. • Failure to get the testing authorized first, can result in the claim being denied for payment and the patient can be left paying a for the service out of pocket

Pre Authorizations Which services have a prior authorization requirement? • Specialized laboratory testing that requires prior authorization can usually be found on the health plan’s website or by contacting the health plan directly via phone to see if the test requires prior authorization. • Many genomic tests and esoteric testing now require prior authorization for outpatient services

Pre Authorizations Who is responsible for obtaining prior authorization? • The physician that is ordering the testing is responsible for obtaining prior authorization for the specialized laboratory test. • If the physician’s office doesn’t get the necessary prior authorization, prior to the testing, the patient will be responsible for paying for the specialized laboratory testing which can range in price from just under one hundred dollars to thousands of dollars based on the test ordered.

Pre Authorizations How to get prior authorization and what information is needed to complete the authorization process. • Call or contact the health insurance company and complete the prior authorization process. • This could include submitting the information via insurance provider’s website • Completing or faxing the insurance provider’s specific form to them • Calling them and providing the information over the phone.

Pre Authorizations Be prepared to provide the following information at the time of request • Patient demographic information and health plan number. • The prescribing physician’s name, business information, ordering provider’s NPI number • Patient’s diagnosis, including the ICD-10 code • The CPT code for the test being requested for prior authorization. These codes can be found on the Lab providers User’s Guide for genomic testing performed in house.

Pre Authorizations Be prepared to provide the following information at the time of request • Name and or NPI of the laboratory that is billing for the testing. (Please note that the name and NPI of the laboratory may not be the laboratory that performed the testing) • The reason why the testing necessary. For example, “The result of the test will directly impact the treatment being delivered to the member” It is best to use the same generic verbiage that each insurance provider uses as a reason why the test is necessary. • In some cases the insurance provider may need to know, what types of treatments have been tried for this problem in the recent past as well as what physical exam findings, imaging findings, or lab results support the request.

Pre Authorizations Below is a list of common genomic laboratory testing that may require prior authorization by insurance companies. This is not an inclusive list. • Chromosome Analysis (Karyotype) • Customized Hereditary Cancer Testing Gene Sequencing • Cystic Fibrosis Poly T Variant, DNA Analysis • Cystic Fibrosis, DNA Analysis • Factor V Leiden Variant Genotyping, DNA Analysis • Familial Mediterranean Fever Studies • Fluorescent in situ hybridization (FISH) • Fragile X, DNA Analysis • Hereditary Breast/Ovarian Cancer-Related Gene Sequencing • Hereditary Colorectal/HNPCC Cancer Risk Panel Gene Sequencing • Hereditary Endometrial Cancer Risk Panel Gene Sequencing • Hereditary Familial Cutaneous Melanoma Risk Panel Gene Sequencing • Hereditary Hemochromatosis, DNA Analysis • Hereditary Neuroendocrine Tumor Disorders Risk Panel Gene Sequencing • Methylenetetrahydrofolate Reductase MTHFR, DNA Analysis • Mircoarray • Prothrombin 20210G>a(c*97 G>A), DNA Analysis • UroVysion

Pre Authorizations AMA in consultation with other medical experts suggested several ways to make the process of prior authorization more efficient to lessen its impact on the patient care. Some of these suggestions are discussed below: • Efficient logistics management: It is suggested to check the detailed prior authorization requirements before providing services. • Following a set protocol: One of the other significant steps to manage the prior authorization process efficiently, as suggested by the AMA, is by establishing and following a strict protocol of consistently documenting the data, the availability of the entire information etc. By maintaining uniformity in the protocol the delays in the treatment of the patient can be avoided significantly. • Strict follow-up to ensure timely approvals: One of the challenges of prior authorizations is the manual nature of the process that takes multiple steps to solve a particular query thus wasting a lot of time. The AMA suggests tracking of the prior authorization requests rigorously and following them up to prevent any kind delays in the process.

Pre Authorizations AMA in consultation with other medical experts suggested several ways to make the process of prior authorization more efficient to lessen its impact on the patient care. Some of these suggestions are discussed below: • Efficient management of the claim denial requests: To prevent further delays in the timely medical care, it is essential to manage the claim denials efficiently. It is suggested that when a prior authorization request is inappropriately denied, put together an organized, well-articulated, and organized report supported by the appropriate clinical information to speed up the process. • Choosing the most appropriate prior authorization method: There are a number of prior authorization methods available these days such as standard electronic transactions, health plan portals, telephone, secure email etc. AMA along with the expert medical practitioners released a comprehensive pre-authorization toolkit that gives the details of the pros and cons of each method to help the medical facilities take an informed decision.

Suggestions • Attempt to automate as much of your lab and pathology prior authorizations with combination of workflow and software to drive exception handling by certified specialists • Build a decision support engine to determine if a prior authorization is need or not needed based on predefined criteria such as type of procedure, CPT/DX codes, insurance • You have TAT for tests now comes the time for TAT for PA requests

Build A Decision Support Engine Decision Support Engine Laboratory Pathology Group EMR Interface or Lab Portal Billing System Physician PMS/EMR Medical Information Insurance Information

Please remember to take a few moments to fill out the session survey. You can find the QR code in your Conference Brochure as well as hyperlinks to the survey online at www.snuginconline.org with the SNUG 2019 handouts.

Mastering Insurance Eligibility & Pre-Authorizations