Info sharing by EHRs found to have an impact on claims denials
Providers that use different systems can have more problems, increasing rejections and boosting the risk of uncompensated care.
Electronic health records systems have the potential to improve care in the future, but in dealing with the current landscape of care, they can have an immediate impact on provider reimbursement.
And, apparently, better utilization of software can improve care reimbursement processes and effectively reduce healthcare costs – not just for individual organizations, but nationally.
That’s the finding of recent research by three universities’ business schools, which contends that better software management by organizations can play a larger role in reducing claims denials and ensuring providers are compensated.
Given the need to maximize reimbursement to prop up margins to the greatest extent possible, this finding places a premium on ensuring maximum reimbursement under current payment schemes.
Getting the record straight
Medical claims management is still important, even as value-based care arrangements grow in use nationwide. To adjudicate claims quickly and effectively, it’s crucial that claims contain accurate information, including patient demographics, medications, medical histories and procedures. However, processes get derailed when claims contain incorrect information or uncovered services, among other errors.
Efficient communication is best when EHR systems can share this information accurately, according to the researchers from Rutgers Business School, the Wisconsin School of Business at the University of Wisconsin and the Fox School of Business at Temple University. The work sought evidence to determine whether claims denials are higher if providers are using EHR applications from several vendors, either within a single hospital or across several facilities, such as in an integrated delivery system.
The research sought to quantify the connection between unpaid bills and gaps in software interoperability. To do so, investigators used a large-scale dataset of claim records from the state of Maryland from 2012 to 2016, analyzing the health records of more than 19 million anonymized patient visits to 48 Maryland hospitals. The dataset included information on whether initial claims were approved or rejected.
The study found that “the greater the EHR adoption by care providers, the less likely a claim is denied.” Analysis of the data, however, showed that organizations that used a single vendor’s EHR system were better able to prevent claims denials than those with systems from several vendors.
The research also gives a nod to the importance of data exchange in collecting information that’s critical to creating a complete patient record that contains all essential information for a bulletproof claim.
“Hospitals often need to share patient data with external care providers, such as other hospitals, clinics and laboratories,” noted the report, published in the September issue of the journal MIS Quarterly. “Similar EHR applications across hospitals can enable more streamlined data exchange for accurate claims processing.”
A multiplicity of EHR systems also can have indirect impacts on claims, the research contends, because it affects the effectiveness of clinicians in using the systems and, thus, recording clinical information that is relevant for claims. “The diversity in EHR vendors across hospitals poses challenges for clinicians working at multiple hospitals, as they must adapt to different layouts, interfaces, workflows and functionalities. This can lead to information errors, such as duplicated procedures or inaccurate records, increasing claims denials.”
Huge potential impact
At best, claims denials can increase administrative burden and result in delayed payments, increasing operational costs for providers. At worst, denials can lead to denied reimbursement and uncompensated care, which totaled nearly $745 billion between 2000 and 2020, the researchers noted.
“Our findings suggest that (EHR) alignment improves clinical data collection and adherence to payer requirements, ultimately reducing claim denials,” the researchers wrote.
Reducing the cost of healthcare in the U.S. will require a basket of solutions; technology is only part of the answer. Even so, EHR coordination and the improved interoperability from these systems have the potential to reduce unnecessary spending, they contend.
“If there is any inefficiency in this process, that can lead to surprise bills for clinics and healthcare organizations, which in turn shifts the cost burden to patients and eventually, to taxpayers,” said Hilal Atasoy, PhD, associate professor of accounting and information systems at Rutgers Business School. “Reducing denials is among the best ways to help contain skyrocketing healthcare costs.”