Healthcare leaders often zero in on how uninsured rates affect their bottom line. But another patient group presents a quieter financial dilemma for providers: those with multiple active health plans. In these cases, it’s important to ensure each plan pays the right amount – in the right order. Should any confusion arise, providers may end up with their claims being denied, resulting in underpayments. This is where the coordination of benefits (COB) process comes in.
What is coordination of benefits (COB) and why is it important?
When a patient is covered by more than one plan, the “coordination of benefits” process kicks in to help health plans figure out their respective payment responsibilities. With patients often having multiple insurance policies, ensuring that each policy pays its share is vital. The purpose of coordination of benefits is to prevent overpayment or duplication of benefits, ensuring that the total benefits paid do not exceed the actual cost of the service received. Integrating a digital COB solution within registration and scheduling workflows can help providers ensure they bill primary and secondary payers correctly, preventing unnecessary claim denials.
Challenges of coordination of benefits
Coordination of Benefits is a pivotal aspect of RCM, but it’s not without its hurdles. Here’s a look at the complexities that often arise:
- Overlapping Policies: Determining which policy pays first can be confusing. Patients with dual coverage might not always be aware of the hierarchy, leading to billing complications. And many legacy systems only select the primary, without consideration for secondary or tertiary. And regional plans add another layer of complexity.
- Claim Denials: Incorrect coordination of benefits can lead to claim denials or overpayments. This not only affects revenue but also strains the patient-provider relationship when patients are billed incorrectly.
- Administrative Burden: Manual COB verification is time-consuming and prone to errors. Staff often spend hours cross-referencing policies, which could be better spent on patient care.
Coordination of benefits: the dream vs. reality
In an ideal world, patients would register for care weeks ahead of their scheduled treatment. During the registration process, they would inform the provider of all their active insurance coverage, with correct and complete details close to hand. No plan would go unmentioned, and no policy number misplaced. Registration staff would quickly enter the information into their EMR without error, so coverage could be verified in real-time.
The reality is far different. Recent findings show that 65% of consumers struggle to understand what their health insurance covers. They do not carry copies of their insurance cards. They may not be aware that they are covered under a relative’s health plan. Patient access teams are under-staffed and over-stretched, with little time to ask guiding questions that would uncover additional insurance.
Coordination of benefits efforts should start as soon as it becomes apparent that a patient has active coverage under multiple plans. Unfortunately, the messy reality of coverage discovery and patient registration means patients and providers are left in the dark until a claim is denied. The payer rejects the claim for a COB-related reason, leaving billers with no clue how to resolve it. The problem gets worse from there.
Automating coordination of benefits for faster, cleaner claims
As with all aspects of healthcare billing, there are many complex rules and regulations governing COB transactions. Under HIPAA, health plans and payers (including Medicare and Medicaid) must coordinate benefits for each patient and determine the primary and secondary payers.
Tracking this manually is extremely challenging for providers: using the information provided by the patient (which may or may not be accurate), staff would contact each payer by phone or email to verify coverage. They would then review the COB rules and guidelines for each health plan to determine the primary payer and follow specific rules for billing secondary payers. It’s no wonder that COB transactions are now among the most automated administrative tasks.
Automating coordination of benefits not only saves staff time, but also increases the chances of finding all active coverage, collating complete insurance profiles for the patient, and making an accurate primacy determination. Digital systems also make it easier for providers and payers to communicate with one another, facilitating smoother dispute resolution and regulatory compliance.
Patient Access Curator brings real-time COB to EH clients
In late 2023, Experian Health acquired Wave HDC, bringing clients a new and unrivalled package of real-time coverage and benefits solutions based on AI-powered data curation.
This new solution, Patient Access Curator, helps healthcare billing teams prevent claim denials in seconds through real-time data analysis. This includes COB curation, which automatically analyzes payer responses to identify hidden cues that staff cannot see. If other insurance is identified, the tool alerts the user and triggers additional queries to verify active coverage and build a complete insurance profile for the patient. Each policy is then analyzed further to determine the patient’s primary, secondary and tertiary coverage, reliably sifting out any non-billable coverage.
Since 2020, the technology powering Patient Access Curator has prevented denials amounting to more than $1 billion.
Integrating coordination of benefits automation yields savings throughout the revenue cycle
Integrating COB automation with other RCM tools, such as coverage discovery and eligibility verification, means providers can prevent and manage denials in a single workflow. Doing this during patient registration allows teams to resolve issues in the early stages of the revenue cycle, rather than wait to deal with them once claims are denied.
While catching errors on the front-end results in faster patient registration and clean claims first time, the tool adds value later in the revenue cycle, too. Streamlining the correction process prevents revenue loss and reduces the need for manual intervention.
Here’s how these use cases look in practice:
- In one multistate practice, the technology automated COB curation with insurance verification during patient registration. This enabled primary coverage corrections for 12% of patient registrations and identified undocumented Medicare and Medicaid coverages for 6% of registrations. Left unchecked, these omissions would have resulted in denials, delays, and missed revenue opportunities.
- The technology was deployed in the denials workflow at a large health system, where it identified COB corrections for 92% of all COB denials. Of these, 60% were immediately refiled to the correct primary payer, minimizing delays in revenue recovery. In the remaining claims, the tool found evidence of inaccurate or outdated third-party liability records within payer claim adjudication systems.
Providers urgently need revenue cycle processes to be as efficient and reliable as possible – especially when dealing with patients with multiple, complex health plans. A powerful denial prevention solution that slots neatly into the registration workflow means they can maximize revenue with minimal human intervention. And with accurate results delivered in seconds, Patient Access Curator could be just what the doctor ordered.
Get in touch today to find out more about coordination of benefits automation and discuss other ways to increase efficiency on the front-end of the revenue cycle, using Patient Access Curator.
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