Solutions to the Challenges of Payment Assurance

By Jay Ratcliffe, Director of Payer Product Management

Imagine this: Patient Jane Doe arrives for an appointment. Upon check-in, the front desk staff verifies eligibility and finds that the patient has a $2500.00 deductible of which $350.00 has already been used. Ms. Doe sees the physician for a new patient visit and the physician orders an in-office sonogram which is also performed. The physician reads the scan and creates a plan of care with Ms. Doe. At check out, the clerk checks the encounter data, accesses the patient eligibility, adds diagnoses and procedure codes, and asks for patient liability. Moments later, the clerk turns to the Ms. Doe, hands her an insurance Explanation of Benefits and a statement which indicates the results of insurance processing and the balance due.

Sound like science fiction? In reality, this type of scenario is getting closer every day. In October 2007, a group of insurers, hospitals, providers and vendors met to explore the challenges of real-time claiming at the WorkGroup on Electronic Data Interchange (WEDI) and X12 joint meeting on Health Savings Accounts and Real-Time Claim Adjudication. Emdeon had the opportunity to present a vision of a many payer/many vendor/many provider network of real-time claiming supplemented by patient responsibility estimation. Attended by both providers and payers, feedback and concerns for where the industry is headed was plentiful. Providers expressed concern that the results of initial adjudication may be adjusted later on, and the payers in the room acknowledged that while adjustments do happen after adjudication, they are rare exceptions that also occur today and are supported by the batch electronic remittance advice and electronic payment processes. The group agreed that the results of adjudication should be considered final and reliable, and discussed detailed transaction flow models which have been published by WEDI, defined a common glossary of terms and looked at the experience of proof of concept systems from the perspective of providers, payers and vendors.

What is real-time claim adjudication? It is a change to the reimbursement cycle to allow providers and insurers to communicate around claims in real time. A single claim is submitted, and within seconds the payer returns the results of adjudication. In exception cases where the claim does not successfully adjudicate, the plan would respond indicating the information or action required for the claim to move forward. The provider would also potentially have the ability to request an Estimate of Patient Responsibility based on allowed amounts for the procedures and the current state of the patient's accumulated usage towards benefit limits.

This whole process can present quite a challenge, however. According to Bob Booz, VP Distinguished Analyst for Gartner, "Because providers have that direct contact with the member/patient at the point-of-service, a provider can be turned into the customer service department for the payer. Unless and until there is transparency available to that member from the health plan at point of service (including complete EOB, information on benefits, etc), providers can find themselves in a difficult situation. When designing a real-time claim adjudication system, you are also taking on a real-time customer service function."

Payers are actively working to improve auto-adjudication rates and to tie real-time EDI interfaces into their claim adjudication systems. Payers are responding to pressure from employers to reduce costs through rapidly growing plan models based on high-deductibles, many of which are linked to health savings accounts (HSAs) or health retirement accounts (HRAs). Membership in these consumer-directed health plans (CDHPs) has consistently increased since the introduction of this model. Market research indicates that approximately 10 million members are currently enrolled in such plans nationally.

Consumer-directed health plans change the status quo for providers and patients. Rather than collecting a nominal copay and sending batch bills to the insurer for the majority of the balance, the patient is responsible for much of their health care spending. Providers are now responsible to collect from the patient amounts which reflect adjustments based on the provider's insurance contract. Booz noted "An EOB, supplemented with the printout of a plan document or summary plan description, allows the provider's office to give a patient the EOB and an explanation of what it means. In this scenario, health plans are both helping the member understand their coverage and maximizing a provider’s ability to serve their patients."

A small number of vendors and payers have begun to offer real time claiming. This is frequently done through a web application which enables providers to manually enter claim data and view a response on a web page. While this proves the concept that plans can process claims in real time, provider adoption of these single-payer tools has been low. Emdeon believes that in order for real time claiming to reach a tipping point and become a mainstream option, a national transaction network with access to multiple payers is needed. Today, Emdeon has this network in place and is actively working with payers and providers to merge real-time interaction with insurers into their claiming products while also working with numerous POMIS and HIS vendors to tightly integrate with the clinic front-desk process. The market will continue to evolve and require tools that can support the shift toward consumerism and real-time claiming is one of the key changes that will enable that transition. Still sound like science fiction? Remember, it was less than two decades ago that the health insurance industry thought a more than 80 percent electronic claims processing rate was science fiction!

Jay Ratcliffe is the director of payer product management at Emdeon Business Services. Have a question or are interested in learning more about where the industry is headed with real-time claiming? Email him at

Product Maturity Drives Claim Intelligence and Transparency Throughout Emdeon's Suite of Solutions

Creating innovative solutions that simplify your claim management processes through reduced costs and enhanced efficiencies remains a top priority for Emdeon. That's why we've added new, standard features and re-named Emdeon Claim Vision - Emdeon Vision for Claim Management.

You still have access to the wealth of claim detail information, but now Emdeon Vision for Claim Management also offers

  • Access to paper and electronic claims data
  • Claim intelligence, including status updates and reports, all the way through adjudication on your claim processing system
  • On-line claim images of your scanned paper claims
  • Tracking capability for your claims routed externally to re-pricers

Regardless of whether the claim was submitted electronically or on paper, Emdeon Vision for Claim Management provides full claim visibility at each juncture of the claim life cycle. Whether you need high-level information or need to drill down to claim detail, you’re only a few mouse clicks away.

What customers are saying about this new service:

"Emdeon Vision for Claim Management has assisted our department tremendously and I would definitely recommend this tool to others. Emdeon Vision for Claim Management saves us time when completing various functions, including troubleshooting claim errors, verifying claim status and timely filing. Our customers will absolutely love its capabilities. Way to go Emdeon!"

---Wanda Williamson, DavLong Business Solutions

Improving healthcare operations for the entire industry, Emdeon Vision for Claim Management is one solution in the Emdeon Vision suite of services that offers similar tools to payers, providers and channel partners. Bringing up-to-date, accurate, and comprehensive claim intelligence to submitters and payers improves customer relationships and reduces complexities related to telephone inquiries, lost claims and re-pricing workflows.

Now, with deeper transparency into the claim cycle, your customer service representatives will have access to the most current, accurate claim data available and you'll be better able to manage your claim operation and forecast claim volumes and workflows. Emdeon is continually working to simplify healthcare business processes for payers, providers and vendors; Emdeon Vision for Claim Management is an important step toward this goal.


Emdeon Prescription Benefit Solutions provides improved safety, streamlined pharmacy data transactions, and rock-solid dependability

Use of the PDTS results in higher quality medical care based on proper medication control, reduced fraud and abuse, better management reporting and control, and most important, increased patient safety.

The U.S. Department of Defense provides prescription drug benefits to active duty and retired personnel, and their eligible dependents, a total of more than 9 million beneficiaries. In 1998, a review by the General Accounting Office determined that this program was severely fragmented. The Pharmacy Data Transaction Service (PDTS) was launched to improve patient safety, streamline data collection and management as well as provide DoD with a centralized data repository and warehouse.

"PDTS has proven itself to be one of the DoD's most successful custom-built systems. In 2006, the system processed more than 166 million transactions for more than 9 million DoD beneficiaries and dependents, with an average response time of under 2 seconds per transaction."

--- Thomas C. Sullivan, Director Computer Sciences Corporation DoD Health Affairs, Health Sciences

DoD security requirements made it impossible for DoD and commercial data to be processed on the same system. PDTS also had to meet DoD requirements for data replication and disaster recovery as well as information and physical security at all locations.

PDTS needed to maintain real-time and batch interfaces with a large number of other government systems, as well as with several commercial entities, over 500 worldwide Military Treatment Facilities and more than 60,000 retail pharmacies.

DoD required the system to perform a wide variety of real-time functions related both to quality of health care and to the financial performance of the DoD prescription drug program.

In 1998, DoD launched the RFP process to identify a contractor to implement the PDTS. Bidders had to be commercial entities with existing capabilities in Pharmacy Benefits Management. In early 1999, the contract was awarded to Computer Sciences Corporation (CSC) with Emdeon as subcontractor providing the technical and functional expertise, including the design, implementation, maintenance and day-to-day operation of PDTS.

Emdeon addressed the need for separating DoD data from commercial transactions by replicating its commercial system, customizing the software to government specifications, and totally isolating the new system from its commercial business.

According to the DoD, PDTS allows the organization to improve the quality of its prescription service and reduce pharmaceutical costs by conducting prospective drug utilization reviews (proDUR) on each new and refill prescription against the beneficiary's complete drug profile. The central data repository also allows DoD to monitor and track patient usage and provider prescribing patterns throughout the Military Health System.

After successfully testing the PDTS system in the spring of 2000, the DoD implemented PDTS in every military treatment facility throughout the world within the following seven months.

The primary PDTS system is located in Twinsburg, OH, with long-distance data replication to the disaster recovery system in Nashville, TN. PDTS is free from single points of failure in either hardware or telecom.

PDTS provides physicians and other care providers with real-time access to a patient’s pharmaceutical profile. A Pentagon news release describes how the system works. When a patient requests a new or refill prescription at any worldwide pharmacy supporting a DoD medical beneficiary, the data is entered into the PDTS, where it is compared with a complete patient medication history stored in the system’s data repository. Through an automated tool, PDTS reviews a beneficiary's new prescription against all previous prescriptions filled through any point of service in the MHS.

With real-time velocity and before the medication is dispensed, warning messages and alerts are provided to the dispensing pharmacist or physician indicating possible adverse interactions, therapeutic overlaps, and duplicate treatments. Each transaction becomes part of the individual's patient pharmaceutical profile stored in the data repository.

PDTS has proven itself to be one of the DoD’s most successful custom-built systems. In 2006, the system processed more than 166 million transactions for more than 9 million DoD beneficiaries and dependents, with an average response time of under 2 seconds per transaction.

Security has met all expectations, and the ability to track patient usage and provider prescribing patterns has helped reduce fraud and abuse. PDTS has achieved Defense Information Technology Security Certification and Accreditation (DITSCAP), as well as being awarded the Air Force Certificate of Networthiness. In 2002, PDTS was also a finalist for the President's Quality Award and a semi-finalist for Harvard University’s John F. Kennedy School of Government’s "Innovations in American Government" award. This program recognizes imaginative and effective government responses to urgent social and economic challenges.

Since its deployment in 2000, the PDTS has avoided more than 171,000 potentially life-threatening drug interactions, in addition to those identified by each pharmacy.

In 2006, PDTS successfully passed the DITSCAP Annual Review and was awarded a continued DoD Approval to Operate. In March of 2007, Emdeon personnel were presented certificates of recognition by the TRICARE Pharmacy Operations Office in appreciation for continuing contributions and improvements.

Find Out More
Emdeon Business Services is fully committed to providing robust prescription claim adjudication solutions and consultative expertise for helping health payers manage prescription benefits in-house, improve patient care and reduce administrative costs.

To learn more, please visit or call 800.521.4548, Option 3.

2007 Emdeon Provider Satisfaction Survey

Improved Emdeon satisfaction rates ultimately improves your provider satisfaction rates

In a continued effort to ensure the best service to our customer base, Emdeon completed an annual survey in late 2007 of 200 hospitals, ambulatory clinics and private-practice physician offices in the Northeast. The purpose was to evaluate user satisfaction with the Emdeon EDI user interface as it relates to:

  • Customer service
  • Technical assistance
  • Overall satisfaction with product functionality
  • Likelihood to recommend the product to a colleague
  • Likelihood to stop using the product and switch to another provider

We're pleased to report that our overall ratings increased from the 2006 survey. While our results have always been positive, they have been steadily increasing in recent years. Providers rated Emdeon's product value, courtesy of customer support representatives, prompt response and issue resolution skills at notably higher levels than the year prior.

Interested in learning more about the study? Contact Tom Allen at
for more details!

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