Posts Tagged ‘protocol’
Medicare and EDI
Medicare, being such a large player on the Health Care market, has the power to dictate how the things are done. One of the major things Medicare established is the electronic standard for health care claims.
Out of all the standards they picked EDI: Electronic Data Interchange, specifically an ASC X12 subset.
If you are unfamiliar with the EDI standard, it’s probably for the best. Imagine XML with no closing tags. You sorta kinda have to guess when a hierarchy level ends by finding a tag that doesn’t belong to it. The next level and the level after that can be optional- so can be some of the starting tags or the level you need to jump to. You get the idea.
Not only the standard is awkward and hard to parse, the implementation guides poorly define what must be sent and what should not. The vast majority of the tags and fields are optional, leaving the standard up for an interpretation by vendors. Needless to say, those interpretations differ quite a bit creating a major compliance headache for the industry.
Medicare accepts claims in EDI format so a lot of insurance companies started to accept is as well. Of course, they all have different rules, bells, and whistles. As a result, a lot of processing is required to submit claims. This is where scrubbing houses come in.
Hospitals still do a lot of business on paper- a lot of it. Their business offices give whatever they can to a scrubbing house, a company that tries to organize the claims and get them ready to be submitted according to the rules of the specific provider. Once the claims are processed by the insurance company, they accept remittance forms in EDI format and send them back to the hospital.
While sending EDI claims is a bit better than sending paper claims, it creates a lot of problems of its own: vague claim definitions, poor ways for revenue reconciliation, and big processing delays. It normally takes 45 days to get a claim processed and get a denial in return, which usually does not tell much about why the claim was rejected.
One of the first things that Health Care industry needs is a better way to communicate. Hospitals, physicians, business offices, scrub houses, insurance companies, and the government all need to be able to talk to each other in a way that is transparent and understandable that allows better tracking, monitoring, and better service. It makes me wish that it were part of the current Health Care debate debate. Unfortunately, it sounds too technical and too down the earth, unlike “public option” and “death panel”.
