Electronic Funds Transfer (EFT)
Want to save thousands of dollars per physician annually? Accepting electronic remittance advice (ERA) and electronic funds transfer (EFT) payments from health insurers and automating your claims process can:
- Speed up payment
- Save time spent on manual processes such as depositing paper checks and phone calls to health insurers
- Eliminate lost EOBs and expedite filing to secondary payers
- Reduce the risk of lost or stolen checks
- Free time for revenue-enhancing functions such as ensuring correct payment
EFT Savings:
- Department of Veterans Affairs documents a 71% improvement & time and expenses savings of 64% of accounts receivable tasks*
- Companies report savings of more than $0.40 in processing costs for each paper check that is converted to an EFT
* Department of Veterans Affairs, April 2006 presentation at NACHA PAYMENTS Conference
ERA Savings:
Cost of paper EOBs: $2.96 x 6200 = $18,600
Cost of electronic remittance advice: $1.48 x 6200 = $9,176
EFT and ERA Combined Savings:
The potential annual saving for switching to electronic remittance advices is nearly $10,000 a year for a physician who submits and annual average of only 6,200 claims. The potential annual savings for switching to EFT is nearly $2,500. That is nearly $12,500 per physician savings when you begin receiving electronic remittance advices and EFT, instead of the manual processes associated with payer explaination of benefits (EOBs) and checks. Consider not only signing ip to receive EFTs, but also to receive electronic remittance advices.
Average annual savings from ERA and EFT automation per physician: $9,424*
* Based on an annual average of 6,200 claims submitted for a single physician. Source: Milliman, Inc., Electronic Transaction Savings Opportunities for Physician Practices. Technology and Operations Solutions. Revised: January 2006
View Aetna’s EDI savings calculator to determine your potential practice savings
Learn more about the AMA’s efforts to reduce the cost of getting paid accurately down to just 1% versus the current expenditure of 8-14% of revenue to just get paid accurately. Access the “Standardization of prior authorization process for medical services” white paper for more information on AMA’s efforts to push for a standard and streamlined automated prior authorization process to reduce those unwanted administrative hassles and hoops to obtain approval to do what your practice does best, provide quality care for a patient.
"Getting started: Accepting EFT payments in the physician practice” outlines the steps you should follow for evaluating whether to implement EFT in your practice and how to do so.
“Considerations for processing electronic transactions in the physician practice” offers specific scenarios of how your practice might adopt electronic claims submissions, and provides additional considerations for your specific situation.
Visit www.ama-assn.org/go/payerpolicies to access online resources from health insurers to help you move towards practice automation.
The suite of electronic health care transactions are designed to work together to create greater efficiencies for both physicians and health insurers. By adopting an integrated approach to using the electronic health care transactions, information gained from one transaction becomes useful information in the next transaction.
- Did you know that the increased use of electronic health care transactions in your practice, such as the electronic eligibility benefit inquiry and response transactions, has the potential to save physicians and health insurers nearly $30 billion per year? [1]
Access this case study to learn more about the savings your practice can experience using electronic health care transactions.
[1] U.S. Healthcare Efficiency Index, www.ushealthcareindex.com
- "Questions to ask a health insurer before signing an EFT agreement” outlines key issues regarding EFT payment that you need to carefully consider before signing an agreement with a health insurer.
- "Questions to ask a bank before signing an EFT agreement” provides key questions to discuss with your bank to understand the logistics of accepting EFT payments and the protections of your bank account.
- "Questions to ask a billing service before signing an EFT agreement” provides key questions to discuss with your billing service to understand how it can assist you in accepting EFT payments and reconciling electronic remittance advices.
- "Questions to ask a clearinghouse before signing an EFT agreement” provides key questions to discuss with your clearinghouse to understand how it can assist you in accepting EFT payments and their remittance advice.
Watch an archived webinar led by industry experts to learn more about the EFT process and how it works for you.
Take the mystery out of electronic health care payments with the document "ACH Primer for Healthcare: A Guide to Understanding EFT Payment Processing" developed by NACHA – The Electronic Payments Association. Written exclusively for physicians and other health care professionals, this valuable primer will help you understand the basics of EFT, identify steps for moving from paper-based payments to EFTs in compliance with government mandates, and answer your most pressing questions. Experts guide you step-by-step through the Automated Clearinghouse (ACH) Network, explaining transaction flow and applications, and identifying available treasury services which can assist you in leveraging EFT. Transition your staff and operations seamlessly using this free, information-rich resource.
Learn how operating rules for EFT/ERA can speed up payment in your practice! View education from CMS about ERA/EFT for guidance and tips on ERA/EFT enrollment and usage. This resource will also help your practice understand how HIPAA mandates the consistent and uniform use of Remittance Advice (RA) codes [Group Codes, Claim Adjustment Reason Codes (CARC) and Remittance Advice Remark Codes (RARC)] to handle claims denials and streamline the claims revenue cycle process.
