Data processing: financial – business practice – management – or co – Automated electrical financial or business practice or... – Insurance
Reexamination Certificate
1998-07-17
2002-01-29
Rimell, Sam (Department: 2166)
Data processing: financial, business practice, management, or co
Automated electrical financial or business practice or...
Insurance
C705S002000
Reexamination Certificate
active
06343271
ABSTRACT:
BACKGROUND OF THE INVENTION
1. The Field of the Invention
The present invention relates to systems for creating and processing health insurance claims. More particularly, the present invention relates to automated health claims processing systems, wherein a health care provider may access information relating to patients, create and submit claims electronically, learn whether the claims are to be automatically or manually adjudicated, and receive automated electronic payment from the claims processing system.
2. Relevant Technology
The cost of health care continues to increase as the health care industry becomes more complex, specialized, and sophisticated. The proportion of the gross domestic product that is accounted for by health care is expected to gradually increase over the coming years as the population ages and new medical procedures become available. Over the years, the delivery of health care services has shifted from individual physicians to large managed health maintenance organizations. This shift reflects the growing number of medical, dental, and pharmaceutical specialists in a complex variety of health care options and programs. This complexity and specialization has created large administrative systems that coordinate the delivery of health care between health care providers, administrators, patients, payors, and insurers. The cost of supporting these administrative systems has increased during recent years, thereby contributing to today's costly health care system.
A significant portion of administrative costs is represented by the systems for reviewing and adjudicating health care provider payment requests. Such payment requests typically include bills for procedures performed and supplies given to patients. Careful review of payment requests minimizes fraud and unintentional errors and provides consistency of payment for the same treatment. However, systems for reviewing and adjudicating payment requests also represent transaction costs which directly reduce the efficiency of the health care system. Reducing the magnitude of transaction costs involved in reviewing and adjudicating payment requests would have the effect of reducing the rate of increase of health care costs. Moreover, streamlining payment request review and adjudication would also desirably increase the portion of the health care dollar that is spent on treatment rather than administration.
Several factors contribute to the traditionally high cost of health care administration, including the review and adjudication of payment requests. First, the volume of payment requests is very high. Large health management organizations may review tens of thousands of payment requests each day and tens of millions of requests yearly. In addition, the contractual obligations between parties are complex and may change frequently. Often, there are many different contractual arrangements between different patients, insurers, and health care providers. The amount of authorized payment may vary by the service or procedure, by the particular contractual arrangement with each health care provider, by the contractual arrangements between the insurer and the patient regarding the allocation of payment for treatment, and by what is considered consistent with current medical practice.
During recent years, the process of reviewing and adjudicating payment requests from health care providers has become increasingly automated. For example, there exist claims processing systems whereby technicians at health care providers' offices electronically create and submit medical insurance claims to a central processing system. The technicians include information identifying the physician, patient, medical service, insurer, and other data with the medical insurance claim. The central processing system verifies that the physician, patient, and insurer are participants in the claims processing systems. If so, the central processing system converts the medical insurance claim into the appropriate format of the specified insurer, and the claim is then forwarded to the insurer. Upon adjudication and approval of the insurance claims, the insurer initiates an electronic fluids transfer to the physician's account.
The foregoing example of an automated payment system reduces the amount of paperwork and time required to process insurance claims and receive payment for treatment provided to patients. However, a significant cost in processing insurance claims is the review and adjudication of individual claims. Careful review of payment requests minimizes fraud and unintentional errors and provides consistency of payment for the same treatment. Furthermore, adjudication of insurance claims ensures that the treatment for which payment is requested conforms to current medical practice and to the contractual obligations of the insurer with respect to the patient and health care provider. However, because manual review and adjudication of insurance claims is labor intensive, a large number of payment requests are simply paid to the requesting health care provider with minimal review.
There have been developed systems that partially automate the claims review and adjudication process. Under these systems, payment requests are accompanied by codified diagnostic and treatment summaries that describe the nature of the patient's condition and the treatment provided. For example, the medical services and procedures provided to the patient may be described using the codes and code modifiers of a volume entitled Physician's Current Procedural Terminology (CPT), which is maintained and updated annually by the American Medical Association.
When a central processing system receives codified payment requests, the system may either summarily approve the request for payment or may assign one or more review codes to the payment request, depending on the diagnosis and treatment. Review codes indicate that the payment request should be further analyzed for consistency with current medical practice or with the patient's condition before payment is authorized. Again, depending on the nature of the treatment, payment requests that are assigned review codes may be either further processed by the automated system or may be forwarded to a medical analyst for manual adjudication.
The foregoing systems at least partially automatically adjudicate insurance claims and have the advantages of reducing the labor intensive nature of the adjudication process and reducing the amount of time needed for claims processing. However, these systems fall short of reducing or eliminating many of the aspects of the claims processing procedure that require repeated or intensive human attention. For example, from the health care provider's standpoint, it is very difficult to routinely be aware of the medical treatments and services that are covered by each patient's insurance plan, since different patients often have widely different contractual arrangements with insurers and health care providers. Depending on the insurance plan of each patient, the patient's medical condition, the patient's treatment history, and other factors, certain treatments may or may not be subject to insurance coverage.
In the past, physicians or their staff have had to spend inordinate amounts of time investigating which treatments will be covered by various insurers and insurance plans. Without detailed investigation, payment request are often rejected in full or in part for being directed to treatments not covered by a patient's insurance plan. Furthermore, physicians are often not made aware of payment request denials until after the sometimes lengthy review and adjudication process is completed. Such delay and uncertainty frequently leads to inefficiencies in providing and selecting appropriate medical treatments and can lead to patient and health care provider frustration.
Another problem with current claims processing procedures is that health care providers are required to submit certain patient and treatment information with payment requests. This
Cecil Vaughn C.
Kwant, Jr. John W.
Peterson Brian E.
Provost Wayne A.
P5 e.Health Services, Inc.
Rimell Sam
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