Electronic Prior Authorization Benchmarking; Dental and Workers Compensation
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1 Electronic Prior Authorization Benchmarking; Dental and Workers Compensation Presented By: Kathy Jönzzon, Delta Dental Sherry Wilson, Jopari Solutions
2 Agenda Overview Prior Authorization Governance Overcoming Systems Challenges Prior Authorization Program Requirements Prior Authorization Formats & Methods of Communication Electronic Prior Authorization Benchmarking Summary Ongoing Process Improvement
3 Overview Prior Authorization Governance 3
4 Overview of Prior Authorization Governance Dental Perspective Dental Treatment Planning Goals Follow established standard practices of providing dental care Accelerate delivery of quality dental services Improve patient dental outcomes Reduce unnecessary dental care and overall system costs Reduce grievances resulting in timely payment to providers Standardize reasonable quality of care controls and incentives 4
5 Overview of Prior Authorization Best Practices Dental Perspective Prior Authorizations usually are rarely utilized by payers for their commercial book of business Payers participating in Medicaid and Medicare Advantage programs do have prior authorization/pre-authorization requirements and can vary state-by-state Pre-determinations are similar to Prior Authorizations but do not reserve patient funds for payment at a future point in time Pre-treatment estimates requests are routinely recommended for non-routine treatment planning purposes and are often times supported in real-time 5
6 Overview of Prior Authorization Best Practices Dental Perspective Prior Authorizations for dental care are usually requested when a treatment plan has been decided upon between the patient and provider. Both parties are looking for a guarantee of payment (if patient remains eligible for benefits) to agree upon patient out-of-pocket expenses. Payers fully adjudicate the treatment plan which usually has required attachments and may require clinical review. The processed treatment plan (Prior Authorization) reserves patient funds to support the processed treatment plan and carries a time limit (ranges from 60 to 180 days) for services to be completed Pre-determinations also usually require full processing and a clinical review but do not carry a payment guarantee or the reserved funds. Instead pre-determinations are used by the provider to review with the patient for communicating out-of-pocket expenses Pre-treatment estimates are routinely real time transactions and provide estimates for planned services not requiring clinical review 6
7 Overview of Prior Authorization Governance Workers Compensation Perspective State mandated regulations Legal system not a medical system Historically costly manual paper based system Same industry stakeholders across all lines of healthcare business Requires coverage compensability determination evidence work related injury/illness Most all treatment requires prior authorization with attachment documentation for services billed Exceptions Providers required to prepare diagnosis- based treatment plan for approval State Fee Schedule rules sets the maximum fees for medical services provided to injured workers covered by the Workers' Compensation Act Prior authorization in most scenarios guarantees payment based on defined state medical treatment guideline and state fee schedule are exceptions 7
8 Overview of Prior Authorization Governance Workers Compensation Perspective Medical Treatment Guidelines Prior Authorization Rules Evidence-based medicine, address occupational injuries that occur most frequently or incur high costs of treatment Medical Treatment Guidelines Goals Establish and or align with standard medical care diagnosis based protocols Accelerate delivery of quality medical services and disability benefits for injured workers Improve medical outcomes Expedite return to work Reduce unnecessary medical care and overall system costs. Reduce disputes resulting in timely payment to medical providers Establish guidelines for quality care at a reasonable price 8
9 Overcoming System Challenges 9
10 Overcoming System Challenges Dental Perspective Challenges Prior Authorizations tie up patient funds with no requirement to perform the services or submit for payment Prior Authorizations and Pre-determinations usually require attachments (radiographs, tooth charting, by report messaging) Prior Authorization and Pre-determinations due to the clinical review step do not lend themselves to real time submissions Remediation Strategies Utilize Pre-determinations same outcome without the administrative overhead as long as patient remains eligible Utilize diagnosis codes in lieu of other documentation Recommendations to Sec for adoption of attachment standards that include: ANSI-approved ADA Standard No.1079 integrated with the HL7 Implementation Guide for CDA Release 2: Periodontal Attachment R1- US Realm X transaction as the vehicle for transportation, and SNODENT clinical code set for dental attachments Utilize diagnosis codes for payment and consider post adjudication reviews quality assessments 10
11 Overcoming System Challenges Dental Perspective Challenges Remediation Strategies Prior Authorizations and Pre-determinations are often dropped to paper responses as the 277, 835 or 278 transactions do not adequately support payer dental treatment plan responses. The 278 transaction for dental is limited to only using for specialists referrals. Enhance selected transactions or create a new one Adopt the 275 transaction to send additional information Prior Authorizations and Pre-determinations due to clinical review extend treatment process Utilize diagnosis codes in lieu of other documentation and consider post adjudication reviews quality assessments Information continuity across industry information channels (Providers, Electronic Health Records, Payers and Patient Portals) Need to standardize data controls to support accurate patient treatment accounting, reporting and history Need data correction opportunities a one time diagnosis when corrected often times is not updated and can cause complications for future conditions 11
12 Overcoming System Challenges Workers Compensation Perspective Challenges Remediation Strategies Every Prior Authorization request requires an attachment - Costly manual paper process States reform initiatives (2008) Adopted electronic attachments standards Cooperative Exchange 49 million electronic attachments Year 55% represent property and casualty 50 different state prior authorization forms - Lack of national workers compensation standard format - Same stakeholders required to comply 50 different formats - Critical need to enhance efficiencies of data analytics National adoption standard formats - X X12 227RFI X HL7 Structured documents Similar to ADA Periodontal - IAIABC International Workers Compensation Standards Inadequate benchmarking abilities to assess prior authorization admin and clinical processes Implementation EDI claims and attachment standards Enhanced data analytics to establish benchmark indicators - Identify scenarios do not require prior authorization - 100% UR <1% denied =$67 UR review X30,000 for 1 year=$$$$ - 80/20 rule to maximize admin/ clinical outcomes/roi - Defines front end attachment rules transparency - Utilize diagnosis and procedures codes for benchmarking in lieu of other documentation Leveraging ICD10 12
13 Overcoming System Challenges Workers Compensation Perspective Challenges Real time submission not applicable due to coverage determination (legal system not a medical system) Remediation Strategies Utilizing EDI benchmark edits and report type codes to expedite process Prior Authorization - Payment based diagnosis/procedure codes/fee schedule allowed amount Identify scenarios for post adjudication review Prior Authorization process lacks acknowledgment audit trail - Impacts stakeholder administrative cost, treatment delay and increases medical and benefit cost States adopted electronic attachment standards (2008) Adopted X12 Acknowledgements ARM ( 2008) EDI Federal Express audit trail Providers and Payers reporting average 50% reduction in administrative cost and expedited treatment authorization 13
14 Prior Authorization Program Requirements 14
15 Prior Authorization Program Requirements Dental Perspective Dental providers are encouraged to submit Pre-determinations when the planned treatment: When patient wants more exacting information regarding out-of-pocket expenses Is expected to involve extensive procedures Spans over calendar/contract year planning Requires specialist services 15
16 Prior Authorization Program Requirements Workers Compensation Perspective Providers required to prepare diagnosis-based treatment plan for approval based on state medical treatment guidelines Specific treatment goals with expected time frames for completion Treatment plan required to fall within specified guidelines Most medical treatment guidelines have specified treatment parameters that once exceeded requires additional authorization for treatment Program requirements define specific attachment requirements, timelines for request/ response and penalties for non compliance Transparency - Key to State Reform Outcomes: Stakeholder accountability Enables EDI upfront edit business rules to facilitate stakeholder workflow automation Increases successful clean first time request submissions and expedites approval process Streamlines the administrative process and reduces cost 16
17 Prior Authorization Formats & Methods of Communication 17
18 Prior Authorization Formats & Methods of Communication Dental Perspective Requests for Prior Authorizations and/or Pre-treatment estimates are very commonly a manual process for dental care Fax Mail Portal applications The 837D transaction supports the submission of Prior Authorization and Pre-determination requests by an indicator in the transaction followed by undated services Acknowledgments (997/999) are routinely used to advise submitter that the request has been received The 278 transaction utilized by medical but does not support dental except for provider/specialist referrals 18
19 Prior Authorization Formats & Methods of Communication Dental Perspective The 277 Claim Status transaction is sometimes used by including a proprietary explanation of benefit like format or push to a URL Proprietary direct data entry/portal solutions are also used to submit pre-determination and pre-treatment estimates 19
20 Prior Authorization Formats & Methods of Communication Workers Compensation Perspective 50 Different state prior authorization formats Submit state form or other formats, however must contain the same data elements as the state form Prior authorization number in most cases required for payment Use paper claim or X (P I D) with PWK form indicator to identify attachment type being sent in support of the prior authorization and is used to expedite authorization routing ebill states adopted (2008) Proposed HIPAA Attachment Standards (2005) Includes X envelope X12 Acknowledgement (ARM) 20
21 Prior Authorization Formats & Methods of Communication Workers Compensation Perspective Submission Methodologies - Flexible Attachment Solutions (Stakeholder EDI Readiness low tech to high tech) - Bar coded coversheets and automated, secure Fax server application - Secure (Direct) - Web portal upload of single or batches - EDI using ASCX Envelope - EDI using HL7 CDA - EDI other application Acknowledgments required at every EDI touch point in workflow process X12 277RFI for additional documentation request 21
22 Electronic Prior Authorization Benchmarks 22
23 Electronic Prior Authorization Benchmarks Workers Compensation Provider Reported Results Metrics Manual Process Electronic Process Comments Percentage of overall services require prior authorization Average time to complete authorization process Average time to track and identify success or failed authorization attempt (Acknowledgements) Number communications methods deployed approval % of authorizations that requires physicians involvement Average clean authorization on 1 st attempt? % Resubmissions % Appeals Average % Average % Average 5 days Average 2 days* Compensability determination *State specified timeline request/response * Electronic submission/acknowledgements Average 3 hours/4days Average 4 Mail/phone/fax/resubmission *Variance difficult assess paper process 58% No edits/acknowledgements 34% 14% None Immediate acknowledgement Average 2 EDI/ Phone* *Variance opportunity automate 50% Admin costs savings and expedited approval *Decrease 80% payer calls over manual process Objective identify why/ mitigation strategy 98%* Transparency * Electronic submission/acknowledgements * Automated attachment front end edits 4 %* Transparency Impact clean transaction % 5%* *Acknowledgements Payment timeline Average 28 days Average 8 days Impact clean transaction % - Compliance medical treatment guideline Utilize prior authorization state/payer < 10 % 53% Need industry education profiling Standard benchmark metrics 23
24 Electronic Prior Authorization Benchmarks Workers Compensation Payer Reported Results Metrics Manual Process Electronic Process Comments Percentage of overall services require prior authorization Average time to complete authorization process Average time to track and identify success or failed authorization attempt (Acknowledgements) Number communications methods respond to request for approval Average clean authorization on 1 st attempt? Rejection Rate Due to Missing Attachments Appeal/Reconsiderations Average % Average % Average 5 days Average 2 days* Compensability Determination *State specified timeline request/response * Electronic submission/acknowledgements Average 2 hours/ 3days Average 4 Mail/phone/fax/resubmission None Immediate acknowledgement Average 2 EDI/ Phone* 50% Admin costs savings and expedited approval *Decrease 73 % provider calls over manual process 65% 96%* Transparency * Electronic attachment submission *Automated attachment front end edits *Acknowledgements Average 27% < 1% Transparency * Electronic attachment submission *Automated attachment front end edits Reconsideration Rates Are lower *Acknowledgements 24
25 Summary Ongoing Process Improvement 25
26 Summary Ongoing Process Improvement Dental Utilize Pre-determinations in lieu of Prior Authorizations to save administrative costs. It provides same outcome as long as patient remains eligible and does not seek other treatment/services between time Utilize diagnosis codes in lieu of other documentation Further Develop Electronic Attachments Promotes ease of submission for complicated treatment plans Utilize diagnosis codes for payment and consider post adjudication reviews quality assessments Enhance selected transactions or create a new one 26
27 Summary Ongoing Process Improvement Workers Compensation Perspective HHS adoption of national electronic attachment standards National standard prior authorization format for all lines of business Transparency automate business rules and workflow processes Acknowledgements Industry standard benchmark indicators Industry focus on the 80/20 scenarios to identify opportunities Increase EDI adoption of structured formats to leverage information to reduce administrative cost, improve healthcare delivery system and achieve stakeholder ROI Need the adoption of national electronic attachment standards to effectively achieve these process improvement objectives 27
28 Questions
29 Thank You Contact Information Kathy Jonzzon, Sherry Wilson, 29
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