Medical lockbox environments have been around for many years now, but addressing the needs of Healthcare Providers (HCPs) is not always an easy task given the current landscape of payments combined with the uncertainty of governmental healthcare programs.
Although 80% of healthcare payments are supposed to be in electronic form, many HCP’s are experiencing that number to be more like 50-60% from many payers. How will the government programs be able to drive a straight-through-process in healthcare payments if explanation of benefits (EOB) forms or secondary insurers are still in the mix?
If EOB utilization continues to be higher than expected, costs of processing will be significantly greater than anticipated as reconciliation from payers doesn’t match the full amount on the claim. Each EOB can include several to hundreds of medical procedures from a single patient. Banks often scan EOBs and send back copies, but a simple copy only cuts down a small portion of this time consuming task that HCPs face in processing healthcare payments.
As the Supreme Court assesses health reform, 55% of hospitals anticipate a drop in revenue with the passing of the Affordable Care Act. Banks in turn should be assessing the added value that they can provide to HCPs to maximize profitability during this transition. For example, if banks could streamline EOB processing like remote deposit capture (RDC) and drive costs out by approaching straight-through-processing levels of efficiency, then HCP’s might be able to easily scale processing for these “less profitable” new customers that will be onboarded.
A recent survey conducted by Orbograph of financial institutions currently offering extended medical lockbox services confirmed that offering a revenue cycle management solution as a part of a medical lockbox can increase profitability. By providing automated posting and reconciliation of EOB forms, HCPs can reduce administrative costs often by as much as 40% while gaining much needed efficiencies in billing and collections.