Guest post by Athos Health
What would you do with half a million dollars?
The healthcare system in the U.S. is expensive, but what can you do? Well, one reason healthcare is so expensive is that we’re paying for mistakes. A lot of mistakes. Your private insurer doesn’t report the number of claims with errors that it pays, but we can look at what happens in Medicare to get a sense of the problem.
11% of medical bills reviewed by Medicare have errors.
In fiscal year 2015, Medicare recovered $359 million in overpayments due to billing and coding errors. [FY2015 Medicare FFS RAC Report to Congress]
This results in overpayment of, on average, 2-5%.
That means healthplans with a $10M spend are spending $200,000-$500,000 for other people’s mistakes!
What makes a self-funded healthplan uniquely vulnerable to mistakes?
In short, self-funded healthplans typically don’t have anyone looking for errors on claims they’re asked to pay. With about 5% of a plan’s spend covering errors, that’s real money left on the table.
It used to be that an insurance company bore the risk and financial responsibility involved in paying claims. However, more and more companies with over 200 employees are choosing self-funded healthplans, where carriers simply process claims, and risk and responsibility shift to the fiduciaries of the plan.
In the self-funded arrangement, you and your employees pay for undetected errors.
The insurance company listed on your card may not be finding all the errors on your bills.
Let’s think about it for a minute. Carriers get paid a set fee, so the way for them to make the most money is through efficiency. And let’s face it: questioning a medical bill is anything but efficient. Errors on medical bills themselves are also the types of errors that an employee wouldn’t necessarily find, either. (Visit http://blog.athoshealth.com/set-your-employees-up-for-medical-bill-success/ for an explanation of why.)
The risk to the carrier then, of letting these errors slide, is minimal. In fact, there is a significant financial burden in chasing them down. Because it’s so time consuming and there’s no money in it for them, carriers often don’t look for errors on the bills themselves.
It’s time to take control.
At Athos, we’re on your side. Athos offers two services to reduce healthcare costs: A medical claim review for self-insured employers (Athos Audit) and a medical expense concierge for their employees (Athos Advocacy). These services give visibility into an organization’s healthcare spend, and peace of mind that employees’ healthcare needs are supported. Athos audit fees are 100% contingent on savings, and require minimal effort for employers to set up.
We’d love to have a conversation with you to answer any questions you may have. Learn more by visiting www.athoshealth.com , calling us at 888.304.1458, or talking to us in person at our table at the July Membership Meeting. We’re here for you.