Expensive claim denials and unexpected payment adjustments that stem from the hundreds of proprietary claim edits individual health insurers create behind closed doors could become a thing of the past in a few short years, thanks to an initiative underway in Colorado.
By early next year, a draft set of standardized payment rules and claim edits will be released for full public review. The rules are in the final stages of development by the Colorado Clean Claims Task Force, a multi-stakeholder group established in 2010 by the state’s Medical Clean Claims Transparency and Uniformity Act. All health insurers in the state will be required to adhere to these rules beginning Jan. 1, 2017.
That means physicians will have access to payment rules and claim edits, and they’ll know what to expect across all insurers when they submit claims. Right now, payer-specific edits account for 61 percent of all claim denials.
The average price to rework a denied claim is $25, according to MGMA. These costs really add up, considering many insurer edits exist in a black box inaccessible to physicians and their billing staff.
The Colorado task force—which consists of more than two dozen experts from national health insurers, software vendors and physician groups, including the AMA and the Colorado Medical Society—is hoping its work will benefit physicians not only in that state but all across the country.
At the end of February, the committee formally petitioned the Centers for Medicare & Medicaid Services to adopt this standardized edit set as its national pilot for a unified claim edit library, a recommendation of the Affordable Care Act.
Several other states also have taken an interest in leveraging the task force’s work for those living and working within their borders. Vermont, for instance, is closely following the work of the task force after having passed a law calling for the creation of a standardized edit set among insurers in that state. Tennessee also has a bill in the legislature, based on AMA model legislation, that includes physician protections regarding claim edits, and stakeholders are examining the ongoing work in Colorado.
The task force’s standardized payment and edit rules are based on existing national industry sources, such as the National Correct Coding Initiative, Current Procedural Terminology® (CPT®) coding guidelines and conventions, and national medical specialty society publications.
Insurers are submitting specific claim edits they would like included in the standardized edit set, which the task force is analyzing against their edit rules. Each edit will be validated against nationally recognized clinical sources, and national medical specialty societies will be engaged in this process.
The initiative is expected to save $80-$100 million per year in Colorado alone. Bringing transparency to claims processing and eliminating the complexities created by inconsistent payment rules and claim edits could save billions of dollars every year for the nation as a whole.
