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The future of out-of-network payments & how providers can collect: 5 market trends & tips to know

The current reimbursement landscape limits the ability of providers to maximize payor reimbursements. However, there are opportunities for organizations to boost financial health by achieving increased insurance company payments for out-of-network care.

The prevalence of out-of-network claims has been growing. Estimates are that the market is at $60 billion and rising still, and according to data from a 2016 Kaiser Family Foundation analysis of large employer health plans, narrow networks forcing patients to go out-of-network are adding to this trend.

During a Dec. 5 webinar hosted by Becker's ASC Review and sponsored by Collect Rx, Collect Rx CEO John Bartos and Executive Vice President Richa Singh discussed how providers can maximize reimbursements and improve revenue in 2019 by optimizing out-of-network insurance claims collections.

Mr. Bartos and Ms. Singh outlined the latest market trends and tips for providers on developing a successful out-of-network plan that capitalizes on current growth trends. The number of out-of-network claims Collect Rx processed has risen over the past five years with the company processing almost $1.5 billion in out-of-network claims in 2018.

"There was a lot happening in the insurance market in 2018, but the overarching theme for payers was continued efforts focused on lowering healthcare costs so long as the quality of care was not sacrificed," Mr. Bartos said.

Collect Rx sees continued growth in out-of-network claims due to market factors specific to the way the U.S. healthcare system is evolving. The total number of people insured increased substantially with the implementation of the ACA and the rising employment rate, resulting in growth in the overall number of patients with out-of-network benefits. Higher enrollment in PPO plans is another trend increasing out-of-network care. "People want insurance policies with out-of-network benefits, and they are willing to pay for insurance policies that have those benefits," he said.

Below are market trends providers should know before developing an out-of-network plan and tips for creating a plan.

5 market trends to know

1. Payers will continue to ramp up efforts to cut costs; cost cutting will occur with the contracted providers. It's anticipated that much of payers' cost cutting will occur with their contracted providers, so establishing a robust non-contracting strategy will be a critical component of 2019 provider revenue plans.

2. Payers will continue to develop plans that encourage patients to find care in the most cost-effective setting and use those services efficiently. "Payers may move into bundled payments, bonus patients and capitation as they push providers to care for the whole patient instead rather than just receiving payments for individual services," Mr. Bartos said. "The shift toward cost-effective places of service will require payers to align provider incentives to get the best outcomes."

3. More outpatient utilization offers the potential for higher volume and lower costs in specialized clinic settings. This points to robust growth in the ASC space. There's a strong current that points toward growth in the number of facilities, the types of procedures and the volume of procedures being performed.

"Payers have been pushing for more outpatient facilities as a way to cut costs," Mr. Bartos said. "Generally, we are seeing a growth in outpatient surgeries across some of the largest specialties, including GI, spine, orthopedics, gynecology and ophthalmology.

4. Payers know consumers care about quality and cost transparency. "The [outpatient] trend is a response to consumer demand for fast, transparent, convenient access," Mr. Bartos said.

5. Payer and provider partnerships are expected to increase. "Providers and payers are more concerned about managing patients' health, rather than viewing them as just volume. We will see more experiments and partnerships along these lines," Mr. Bartos said.

5 tips for creating a successful out-of-network plan

1. Analyze success with out-of-network efforts: Conducting an out-out-network case review or audit will tell a practice about their out-of-network history, including what the organization charged and what the payers reimbursed. Such a case review can help generate an accurate estimate about appealable claims.

"Look at what you've billed, and what the payers have reimbursed across your procedures," Ms. Singh said.

2. Conduct a fee schedule analysis: Three major areas must be evaluated when conducting a fee schedule analysis. "Overall cost, current fees and payments and a usual and customary database should be compared to the payments you're receiving from your payers by CPT code to see if you're sufficiently compensated," she said.

3. Do a chargemaster review: Conducting a complete chargemaster review can help establish baseline indicators to assess performance on payer reimbursement. "Then, analyze revenue and usage to identify potentially missing charges," Ms. Singh said. "You will minimize compliance risk by reviewing charge descriptions against CPT codes and reviewing all compliance that is flagged."

4. Validate reconciliation: As leaders begin to understand their organization's out-of-network billing and reimbursement history, continue the analysis to fully understand what has been billed and what the payer has reimbursed. "If there are holes in your process, you'll want to fix them now before introducing multiple payments for the same claim to your workflow. Missing payments can be a significant inhibitor to success in any out of network program."

5. Third-party rental network agreement review: It's important to review contracts not made directly with a payer. Contracts between providers and a third-party company typically favors payers.

"Although these contracts are sold to you to help save you time, they are actually detrimental," Ms. Singh said. "These contracts serve as caps to your reimbursement and will only be applied if it saves the payer money."

The future of out of network payments

Since out-of-network reimbursements have substantial opportunity to pay higher than in-network, providers may consider going 100 percent out of network, but often a hybrid strategy is going to be the best for organizations to maximize revenue. Collect Rx recommends a strategy where a provider goes in-network with some payers and out-of-network with other payers. Leveraging out-of-network reimbursements gives providers another chance to overcome the industry's current financial pressures.

"[Out of network payments] are the last great opportunity for many providers to bring more dollars in the door," Ms. Singh concluded.

To learn more about Collect Rx, click here. To watch the full webinar, click here.

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